The Rio Grande do Sul state chapter of the Brazilian Micro and Small Business Support Service (Sebrae/RS) has issued Public Call nº 01/2010, to select proposals by SMEs and farmers from the state who are interested in gaining greater visibility abroad and, thus, earning greater chances for doing business. The Institution should invest some 1 million Brazilian reais (US$ 545,000) in this project.

The Public Call contemplates companies in the agriculture, food and beverage, metal and mechanical, leather and shoe as well as wood and furniture sectors that may be interested in participating in events, as exhibitors, or in trade missions, with the support of the Sebrae/RS.

According to superintendent Marcelo Lopes, “the Sebrae wants to make a more effective contribution to the process of insertion of small companies from the state of Rio Grande do Sul in the international market. In this respect, we established with sartorial organizations a calendar of the most important fairs in each sector, defined a program for training and significant subsidies to stimulate the participation of companies.”

According to the manager, the organization is also “innovating in the process for selection of companies, through public calls. The opportunities are open to all companies that fulfil the performance requirements published in the call.”

Up to 180 companies should be selected, to receive international business training and the organization of a program to aid and identify the best opportunities in the fair to be visited. Among the objectives are the winning of new markets, partnerships, representation and distribution, recognition of new partnerships and innovation.

The exhibitors selected should have 70% financial support in the purchase of space and assembly, whereas those participating in trade missions should count on 50% financial support in the travel package, including tickets and housing.

Revestir Turnover

The organizers of the Brazilian Tile and Stone Exhibition (Revestir), to take place from March 9 to 12, in São Paulo, estimate that the event should generate a turnover of US$ 150 million in business, according to information just disclosed. Last year, according to the organizers, the fair generated US$ 140 million. The bet for 2010 is for growth of 7%.

According to the organizers, this year’s edition should receive 200 exhibitors, including suppliers of products and services in the area of building tiles. Over 45,000 visitors from several countries are expected.

Sebrae

Out of 1,068 industries surveyed, the majority (61%) has up to nine workers, a size that also prevails (50%) among companies that increased their personnel in the second quarter of 2009 (29.3%), with an average of 2.1 admissions during the period.

The survey was conducted from July 1st to 8, 2009, and interviews were conducted among randomly chosen heads of industries with up to 50 workers in the state of São Paulo. The survey also approached past and forecast dismissals, the production capacity in use and the main uncertainties of businessmen for 2009.

Out of the industries surveyed, 6% intend to dismiss workers in the third quarter of 2009, the majority (57.1%) consisting of companies with 10 to 29 workers, followed by those with up to 9 employees (42.9%).

The result ratifies the trend of decreasing dismissals in the sector, given that 35.3% of the companies surveyed claimed to have dismissed workers in the second quarter of 2009, the majority (51.2%) being companies with up to nine workers, followed by companies with 10 to 29 workers (34.2%).

The survey showed that a significant share of the micro and small industries surveyed were able to either maintain (54.3%) or increase (8.6%) their capacity in use.

Among the obstacles to be faced in the second half this year, the most cited were uncertainty (35.3%) and falling sales (27.6%), followed by credit scarcity (6%) and the tax burden (3.5%). On the other hand, 14.7% are optimistic and reported no expectations of problems for the coming months.

Anba

Out of every 100 micro and small companies, 63 had or are still having trouble dealing with the consequences of the world economic crisis, such as reduced demand and more expensive credit.

These were the main results of the survey "Impact of the International Financial Crisis on Brazilian Micro and Small Businesses," conducted from March to May 2009 among 4,200 micro and small companies across the country, by the Brazilian Micro and Small Business Support Service in the state of São Paulo (Sebrae/SP).

According to Ricardo Tortorella, superintendent of the Sebrae/SP, the international crisis has the worst impact on activities that depend on financing, which is the case with the industry and export-oriented agribusiness.

"The activities that are more dependent on consumers' income are less impacted by the crisis, such as, for instance, the trade and services sectors. This should be the trend for all of 2009," he claims.

Among the impacts felt by businessmen, those that stand out are reduced demand (60%) and interest rates (45%), ranging from high interest rates (45%) to problems obtaining financing (40%).

"The problem in obtaining credit does not occur solely in times of crisis. Micro and small businesses have a hard time when it comes to offering guarantees and presenting all of the documents required when the time comes to apply for financing," explains Tortorella.

The rising costs of imported products and the reduction of grace periods were also listed by businessmen (33% and 24%, respectively). On the other hand, only 2% of interviewees pointed out to an increase in insolvency rates by clients, dismissals, decreased profits and reduced exports as consequences of the world crisis on their businesses.

In terms of regions, owners of companies in the Brazilian Southeast and Midwest claimed to have been the most affected by the economic crisis, at 64%. "Those are regions that concentrate industries and export-oriented agribusinesses, which were more strongly affected by the reduction in the level of activity and of consumption abroad," says Tortorella.

In terms of states, Goiás had the highest rate of companies affected: 72% of businessmen were or are being impacted by the consequences of the crisis. The lowest rate, on the other hand, was that of the state of Santa Catarina.

Whereas the Southeast Region (62%) felt the strongest impact from reduced demand, the rate was lower in the South (57%). Businessmen in the Northeast were those who complained the most about difficulties in gaining access to credit (43%).

In terms of sectors, industry had the highest rate of companies harmed by the world economic crisis, at 67%, followed by trade and services (66% and 56%, respectively). "The international financial crisis impacted more intensely on industrial activities, because they are more dependent on exports and bank loans, be it for funding their working capital or leveraging their sales on the market," explains Marco Aurélio Bedê, a consultant for Sebrae/SP.

Within the industry, the most affected segments were durable consumer goods (machines and electric appliances) and capital goods (machinery and equipment).

"At times of economic uncertainty, those industries are usually the most harmed, because they depend on two variables: high product cost per unit and the granting of credit in order to sell. Such is the case, for example, of a small industry that manufactures furniture, and sells a bookshelf for 1.500 reais (US$ 750, a high cost per unit) on credit," says the consultant.

The decreased demand was also felt in activities pertaining to trade. "When it comes to trade, aside from credit being more expensive and harder to obtain, there is also the greater uncertainty and the psychological effect on consumers, who have either reduced or postponed their long-term purchases," says Marco Aurélio Bedê.

Even nine months after the onset of the world crisis, 42% of micro and small business owners assert that there has been no improvement in the supply of funds for loans from banks. Another 30% consider that the credit supply has improved, whereas 28% did not know how to reply.

Businessmen in the North are the most pessimistic regarding an improvement in the supply of funds: 45% claim that there has been no improvement in credit supply, as against 37% in the South. On the other hand, micro and small businesses in the Midwest felt that the volume of funding available in the market has increased (34%).

For the next six months, the majority of businessmen are working with a realistic scenario, the highlight being an optimistic forecast of increasing revenues (46% of respondents). With regard to the number of employees, 67% should maintain their current personnel, and only 8% intend to dismiss workers.

"The good news is that Brazil belongs in the globalized world. Besides, Brazilian entrepreneurs are persistent, daring, and willing to take risks. Al of that is important in times of crisis," Tortorella finishes off.

Sebrae

The average individual value exported by companies in the sector has also been growing firmly in recent years, reaching US$ 163,900 in 2007, up 12.5% over the previous year and posting average growth of 10.5% over the last five years.

This and other figures referring to the performance of Brazilian exports over the decade are included in the just-released study Micro and Small Companies in Brazilian Export -  Brazil and States – 1998/2007.

Ordered by the Sebrae (Brazilian Service of Support for Micro and Small Enterprises) to the Foreign Trade Studies Center Foundation (Funcex), the study is executed based on figures supplied by the Foreign Trade Secretariat (Secex) and other organizations.

The base collects and also crosses with figures by other organizations information about all the 13,000 or so micro and small companies in Brazil that exported in the period between 1998 and 2007.

The document should serve as an important reference for internationalization activities of micro and small companies promoted by the Sebrae and by partner institutions.

"This study is the consolidation of some tendencies that have been crystallizing since 1998. Through it, we may identify what are the difficulties faced by companies to stay on the market, the existing opportunities and the successful experiences," said the Strategic Management manager at the National Sebrae, Pio Cortizo.

Accompanying the general rhythm of Brazilian exports, small companies operated specially in the fields of industry and trade in 2007. Thus, 59% of exporters in 2007 (7,670 enterprises) belonged to the field of industry and 35% (4,550 companies) were in the trade field.

Among the micro companies there was a reduction in the number of firms in all sectors, except for agriculture. The opposite took place among small companies, with a larger number of companies in all cases, including the industrial field, but with an exception in agribusiness.

With regard to the value exported, the industrial sector answered to 60.1% of the value exported by micro and small companies in 2007, which represents a total of US$ 1.3 billion. Trade came in second place, with 33.6% of the total exported, and in last came the service sector, with 0.2%.

Among the special micro companies (which employ little and export much), industrial firms answer to 60.1% of the total, against 33.9% of commercial organizations. The value exported by these companies was divided into similar shares among the industrial and trade sectors, 49.4% and 42.8% last year.

The number of micro and small export companies has not been accompanying the growth of export volume. This figure remained stable in 2007 when compared to 2006 (12,986 against 13,001). In this period there was growth of just 1.6% in the number of exporters and reduction of 2.3% in the number of micro companies.

According to the study, this has been taking place since 2004, when a reduction in the number of micro and small companies contrasted with the relative stability in the number of special organizations and of medium firms and there was an increase of 5.1% in the number of large exporters.

Sebrae

The average annual balance of surviving companies was 233,000, equivalent to 32.07% of all new establishments.

The average annual growth in the total of companies active in the period was 5.7%. In 2006, there were little more than 5 million companies active in the country.

According to the report, the greater number of companies in 2001 was the result both of greater entry of companies in the period analyzed (829,302) and due to a lower number of companies leaving (330,276). The low growth in 2006, in turn, was the result of average new entries of (710,868), and a greater number of exits in the period (664,489).

The study also shows that the average rate of entry of companies in the market, between 2000 and 2006, was 16.9%, whereas average exits were 11.2%.

Activities related to agriculture, livestock farming, wood, forestry exploration, fisheries and services represented the greatest rates of company entries. The lowest rates were identified in industrial activities.

The IBGE study also shows that business established between 2001 and 2006 was responsible for 46.5% of formal employment in companies in the period.

Of every ten formal jobs created by new companies (with up to five years in operation), between 2000 and 2006, an average of four were in trade, three in the service sector and three in industry. With regard to company size, five of these posts were established in micro companies, three in small ones, one in medium ones and one in large ones.

The study analyzed 5.1 million establishments among the 5.7 million companies and other organizations active in the 2006 Central Company Registry.

Anba

The institution's target is to train 4,000 companies from all over the country, over the next two years, to operate in foreign trade.

Through this program, solutions to contribute to more competitive positioning by the companies will also be developed, adapted and implemented for the domestic market, which is getting more global.

"If we strengthen micro and small companies for the foreign market, we will also guarantee the domestic market, as we will have greater productivity, more quality, more jobs and greater income in the country," stated Sebrae president Paulo Okamotto.

The management of the Market Access Unit at Sebrae, Raissa Rossiter, explained that the program is going to operate on two fronts. "It plans to intensify the support to micro and small companies that have exported since 2003 and to strengthen the partnership with other institutions, both on the national and on the state scope."

According to the manager of the Internationalization Program, Louise Machado, it is important to point out that there is a difference between the export concept and internationalization. "A given company may have a localized export action, i.e., have one single foreign sale, and not have enough capacity to remain in the market, due to factors such as low production capacity, quality or promotion. A company that undergoes an internationalization process becomes able to enter the foreign market and remain in it," he explains.

The Program for Internationalization of Micro and Small Companies is aligned with the Production Development Policy (PDP), launched in May this year by the Brazilian Ministry of Development, Industry and Foreign Trade. One of the policy's four major goals is to increase the participation of micro and small companies in foreign trade.

By means of the policy, the government wants to increase by 10% the number of enterprises involved in the foreign market, which should total to around 13,000 small and micro exporter companies as of 2010. Presently, the country has 11,792 micro and small exporter companies, according to a survey ran by the Brazilian Agency for Industrial Development (ABDI) in 2006.

In order to surpass the goal proposed in the PDP, of training 1,792 companies and including 4,000 companies in the program, the strategy of Sebrae consists of working at first with 3,000 companies selected by Sebrae and by the Brazilian Export and Investment Promotion Agency (Apex-Brazil) in their foreign trade programs.

"These are companies or production arrangements that already have some experience in the foreign market, but did not stay in it. The remaining 1,000 are going to be reached through means of promotion and advertising actions under the Program, spontaneous demand, and Sebrae's 800-plus points of service," explains Sebrae manager Raissa Rossiter.

A major differential of the Program is the fact that it is part of the Brazilian Export Strategy plan, which aims to grant more agility and integration to foreign trade actions by government organisations, such as the Brazilian Ministry of Development, Industry and Foreign Trade, Apex-Brasil, ABDI and the Foreign Trade Board (Camex).

Export Policy

The International Business center (CIN), the Foreign Trade Theme Board and the University of Industry (Unindus), of the Federation of Industries of the State of Paraná (Fiep)> in partnership with the Brazilian Ministry of Development, Industry and Foreign Trade, are going to promote, on October 3, from 8:30 am to 12 noon, in the city of Curitiba, seminar Export and Defense Policies of the Brazilian Industry.

The schedule includes two lectures followed by debates. The first will be The Brazilian Export Strategy, presented by the secretary of the Ministry of Foreign Trade, Welber Barral. The second will be Defense of the Brazilian Industry, by the coordinator of the Trade Defense Department of the Foreign Trade Secretariat (Secex), Ana Carolina Meneghetti Peres.

Sebrae

The objectives of the visits were to follow the development of the program in those countries. The group, which included the technical director at the Sebrae, Luiz Carlos Barboza, the president of the CACB, Alencar Burti, technicians and managers of both institutions and superintendents of the Sebrae in the states of Bahia, Edival Passos, Rio Grande do Norte, José Ferreira de Melo Neto, and Santa Catarina, Carlos Zigelli, visited nuclei of companies reached by the program, operated by the Seda (the Small Enterprise Development Agency), in South Africa.

"The Sebrae is attempting, starting this year, to build a clear and determined cooperation in Africa. Empreender is generating relevant results, but it is undergoing adjustment due to local adaptations the program is receiving," stated José Marcelo Goulart, of the Sebrae International Advisory Unit.

The national coordinator of Empreender at the Sebrae, Ricardo Vilela, believes that the development of the program is corresponding to expectations and is already generating significant results. "We have identified that the methodologies adapted to the local realities are working out and that there is great interest in expansion of the works," he explained.

The national team was received by the first lady of Mozambique, Maria da Luz Guebuza, for the elaboration of agendas turned to international cooperation and to develop actions in favor of small local businesses in both countries.

Three Nations

The Brazilians also visited the program nuclei in Mozambique. There, another group, made up of technicians and managers at the Sebrae and by the director at the Anprotec, Francilene Garcia, participated in the "Tri-nations Summit on Small Business", a forum to discuss micro and small companies in Brazil, India and South Africa.

Among the topics discussed at the Tri-nations were topics like innovation of technology, with visits to company incubators and to the center of Technological Demonstration of Mozambique, and franchise model structuring. In visits to incubators, the manager of the Unit for Access to Innovation and Technology at the Sebrae, Paulo Alvim, declared that the country has a very effective policy of business integration. "This is an opportunity for cooperation turned to the establishment of technological solutions for the transfer of knowledge," she said.

To the coordinator of the Franchise program at the Sebrae Market Access Unit, Patrí­cia Mayana, the visit was advantageous, mainly due to the incubator and franchise projects implemented in Africa. According to the consultant, "the work developed for insertion of small companies is complete, mainly in the area of markets".

Transferring Knowledge

Since 2007, institutions supporting micro and small companies in South Africa, Colombia, Chile, El Salvador, Mexico and Mozambique have been operating using the Empreender methodology, developed by the Sebrae and CACB. The proposal of internationalizing the program arose after a large event in South Africa, which included the participation of the CACB and of trade associations from over 60 countries. At the occasion, several asked for the transfer of knowledge from the Brazilian program.

Empreender supports trade and business actions originated by sector nuclei and appreciating the positive aspect between businessmen. Through the nuclei, which bring together companies in one sector, it is possible to get in direct contact with other companies, to seek common solutions to matters that, alone, businessmen would have difficulties to solve.

The program's methodology came from Germany and started being implemented in Brazil the state of Santa Catarina. After modifying it to the national reality, it started being implemented throughout the country. Since then, the program has already benefited over 30,000 companies in around 500 cities. Today, 2,000 sector nuclei are operating in Brazil.

Sebrae

52% recorded expansion in production volume, 46% increased their revenues, 39% had greater labor force productivity and 24% expanded their personnel. The results are twice as good as those posted by companies that did not innovate.

The survey Innovation and Competitiveness in Micro and Small Companies in São Paulo, elaborated by the Micro and Small Enterprises Observatory, heard 450 companies based in São Paulo, a sample representative of the universe of companies in the states in the industry, trade, and services sectors.

The survey was presented last week during the workshop Innovation and Competitiveness Challenge in Micro and Small Enterprises, at the auditorium of Sebrae/São Paulo.

The aim of the survey was to determine the rate of innovation among micro and small businesses in the state of São Paulo, evaluate the frequency with which businessmen innovate their businesses, and determine what were the main innovative processes implemented.

To the Innovation and Technology manager at Sebrae, Marcelo Dini Oliveira, "innovation can contribute a lot to increasing the competitiveness of micro and small enterprises; for that reason, we put our best efforts into propagating this concept," he asserted.

To the technical director at the institution, Paulo Arruda, attaining success in business does not depend solely on having a quality product and good customer services. "In order to have a differential, a company must always innovate, and this survey proves this to be possible with little money and much creativity," he said.

As to the frequency of innovation, the survey indicated that 53% of the companies interviewed claimed to have made some improvement or introduced a new feature in their business. Of all the companies surveyed, 28% developed new products, 22% implemented new processes and 15% conquered new markets.

With regard to product- and service-related innovation, 11% consisted of greater brand variety, additional services, products that consume less energy, new parts in the auto industry, new medication, and household appliances. The need for business innovation, in 11% of the companies, was identified by means of suggestions from the customers themselves.

With regard to the adoption of new processes and methodologies, 5% of the businessmen cited computerization of the company, along with improvement of quality and security, inventory and quality control, courses and implementation of new production technologies. These processes were initiated, in most of the companies, from inside the company itself.

The survey also determined that half the companies invest up to 2,000 reais (US$ 1,253) in development of new products, the same amount in development of new processes, and up to 6,000 reais (US$ 3,761) in seeking new markets.

Of the 28% of interviewed companies that innovated in their products, 96% are already profiting from sales of the product in the market, and obtained a 84% rate of response to the product as great or good.

Sebrae

One of the bets by the company, which already exports to 11 countries, among them Saudi Arabia, is to invest in the Middle East. The first step will be participating in the next edition of Gulfood, a food sector fair to take place in February 2009, in Dubai, United Arab Emirates.

According to the commercial manager at Titã, Edinael Carlos Magalhães, the company closed two deals with a Saudi distributor in 2005 and 2007.

The manager recently also made contact with importers from Egypt and the Emirates. "We strongly believe in the buying potential of the region. The fair is going to allow direct contact with importers in several Arab countries and will be a great chance to present our products to them," said Magalhães.

Titã integrates a consortium of bakery and confectionery sector exporters, Brazilian Bakery Equipment (BBE), and is going to be at a stand organized by the Brazilian Export and Investment Promotion Agency (Apex-Brasil).

The factory is an example of small company success. When it was established, in 1995, it employed five people. Thirteen years later, the company has 50 employees and is now the leader in the Brazilian snack display case market. The factory is installed in an industrial area of 10,000 square meters.

The first contact with the foreign market took place in 1999 and the first shipment abroad was in 2000, to the United States. With support from the Brazilian Micro and Small Business Support Service (Sebrae) and the Institute for Technological Research (IPT) of the State of São Paulo, Titã obtained, in 2003, its first technical certification.

The company also has CE certification, complying with the technical norms of the European Union. The three main import markets are the United States, Mexico and Germany.

Service

Telephone: (+55 16) 3322-0653
E-mail: tita@tita.com.br
Site: www.tita.com.br

Anba

This is the fifth consecutive month in which small enterprises post an increase in revenue in comparison with the same month of the previous year. Average revenues stood at 15,200 reais (US$ 9,000) per company.

This was the best result in terms of revenues for the month of February since 2002. Micro and small retail companies are still driving the resumption of growth, as they posted an 11.6% expansion in revenues compared with February 2007. Revenues of small businesses in the industry and services sectors decreased 4.3% and 10.2%, respectively.

The data were taken from the Brazilian Micro and Small Business Support Service (Sebrae) Indicators/SP survey, conducted on a monthly basis by the organization among 2,700 micro and small-sized companies in the processing, trade and services industries, and which measures rates of actual revenues, personnel employed, expenditure on wages, average worker income and expectations. The survey counts on the collaboration of the State Data Analysis System Foundation (Seade).

To the economist at the Micro and Small Companies Observatory at Sebrae/SP, Pedro João Gonçalves, "micro and small companies, especially those in retail trade, are benefiting from the growth of the domestic market, driven by the recovery of the population's purchasing power and by the larger number of options for obtaining credit to make purchases."

For the next few months, the businessmen are relatively optimistic. According to the survey, 40% of the interviewees believe that their company's revenues are going to improve over the next six months, and 50% bet that they will remain the same.

With regard to the economy, 38% are expecting for the Brazilian economic situation to improve over the next six months, and 48% believe that the current economic conjuncture will remain stable.

In the assessment of the superintendent at Sebrae-São Paulo, Ricardo Tortorella, 2008 might be a positive year for micro and small companies: "In 2007, micro and small businesses posted a 4% growth in revenues. As the perspectives for Brazilian economy are relatively favorable, revenues posted by these companies are expected to continue recovering."

Trade Surplus

Data disclosed Monday, April 14, by the Brazilian Ministry of Development show that, last week, the Brazilian balance of trade posted a surplus of US$ 319 million, with exports totaling US$ 3.072 billion and imports, US$ 2.753 billion. In the result for the month, the accumulated surplus was greater than US$ 1.161 billion, and for the year it reached US$ 3.998 billion.

The accumulated balance of trade surplus for the year in Brazil, up until the second week of April, is almost US$ 6.5 billion lower than recorded during the same period in 2007.

In a comparison with the accumulated result in the same period last year, export value grew 14.1% on average per business day, and import value rose 41.4%.

With regard to the accumulated surplus, which was reduced from US$ 10.484 billion to US$ 3.998 billion using the same basis for comparison, the average per business day decreased 61.3%, from US$ 147.7 million to US$ 57.1 million.

ABr