BELO HORIZONTE, Brazil — Brazil has beautiful fashion, but it’s having a hard time selling it abroad.
At least that was the view of buyers attending the recent Minas Trend fashion fair here.
“They are not ready,” said Pamela Shiffer, owner of her namesake London boutique. “They don’t have the infrastructure so that makes it difficult to know if they will deliver on time.”
Shiffer said one of the catwalk brands, Mother of Pearl, could not readily provide merchandise prices, while others told her they had no export experience.
“If they want to be in the international market they need to embrace the idea of exporting, do more research on finance, duties and tax, and be ready to work with international brands,” Shiffer added.
That said, she ordered clothes from two labels, Lucas Magalhaes and Loft 747, for the fall season, while she found “many really interesting things and products for the U.K. market.”
Graziella Nogueira, cofounder of Canadian retailer Zielara, added that some brands could not provide “reliable discount prices” while many seemed unprepared to negotiate reverse seasons (Brazil’s summer is winter in Europe and the U.S.).
Other brands were too expensive given the long turnaround times to ship to Europe, said Naouel Brahmi, co-owner of the Wedding Queen Paris boutique. Brahmi was impressed with the fashion, however.
“I liked all the colors and embroidery, which is very well done,” Brahmi said of the brands she visited, including Vivaz, which hand sews evening and wedding dresses that cost as much as $25,000.
Gina Guerra, creative director at upmarket women’s wear brand GIG, agreed many firms are unfit or uninterested in international growth.
“Everyone is so unprepared and there is a big disconnect with the international market,” Guerra said, adding that many are also unwilling to seek help from Texbrasil, a government export promotion program.
Guerra said GIG, which sells primarily in Europe and the Middle East, has a dedicated export department and has been selling abroad since 2005. The firm, which hopes to ramp up exports by 20 percent to nearly 8,500 garments this year, can manage opposite seasons and on-time deliveries. “We are like two separate companies, working with two seasons at the same time to supply 40 international points of sale (pos),” she said.
GIG, which recently moved to a new 10,000-square-foot factory in Belo Horizonte and spent $600,000 to boost production, hopes international sales will grow 30 percent by 2020.
Patricia Motta, famed for making leather dresses from Amazonian pirarucu fish skin, said Brazilian labels must make use of the Texbrasil program and take a more proactive export approach.
“Many brands don’t use Texbrasil and they are there to give us export steps,” Motta said, adding that the luxury brand recently hired Attitude, a Brazilian consultancy, to help it navigate the international arena, where she hopes to operate 70 points of sale compared to seven now. The firm’s next foray will be China and Asia after a recent Shanghai fashion show saw a strong reception.
Guerra said banks are also willing to bankroll international exports to hedge the slumping real.
“BNDES [the development bank] gives very cheap loans,” she said, adding that the institution recently granted it a 9 percent annual interest loan, much lower than commercial lenders.
While conceding they have work to do, executives from main industry lobby Abit said brands are increasingly keen to enter foreign markets.
“There are more companies interested in international business, not just because of the lower exchange rate but also because the economy is not doing well,” director Fernando Pimentel said.
He expects Texbrasil’s program members to expand 10 to 15 percent to 300 firms next year and exports to rise by 5 to 10 percent from $1.3 billion this year.
Buoyed by strong gains in Latin America’s biggest economy, Brazilian brands have focused on local markets and draw a mere 5 to 10 percent of revenues from abroad, according to Pimentel. He said Texbrasil is studying new ways to raise export promotion benefits (with a new strategy to be fashioned in mid-2016) and will continue to offer export training and promotion activities, both for main and niche markets. Near-term actions will focus on China, Asia and the U.S.
Texbrasil’s 267 members are ready to export competitively, a spokeswoman said. “They have to pass a diagnostic test to ensure they have garment quality, all required paperwork, follow labor laws and have a dedicated, English-speaking international department or representative,” she said, adding they must also be ready to provide FOB and CIP prices.
Meanwhile, Minas Trend and Belo Horizonte are working to boost visitors and the city’s fashion image.
Brazil’s only integrated apparel and fashion fair hopes buyer numbers will increase 5 percent annually to 5,200 by 2018 when nearly 20,000 visitors should swing through its doors, according to international business director Alexander de Brito Santos. By then, the biannual event also hopes to double foreign-buyer attendance to 40.
“We are bringing more buyers and raising investment,” de Brito said, adding that organizer Sistema Fiemg will invest $100,000 to publicize the event this year, though revenues will decline 20 percent to 2.5 million reals due to the weak economy.
Located in Southeast Minas Gerais state, Belo Horizonte [Beautiful Horizon] boasts 300 brands and 3,000 manufacturers specializing in luxury hand-made and embroidered dresses. Underpinned by a strong mining tradition, the fashion industry has flourished by making highly elaborate dresses embellished with local gems such as tourmaline, aquamarine and Imperial Topaz. Minas Gerais is also a big producer of gold, diamonds and emeralds.
Fiemg, a regional trade federation network, is moving to attract buyers from 50 countries but mainly the U.S. and the Middle East, where shoppers appreciate elaborate Brazilian party and evening dresses such as those made by leading labels Patricia Bonaldi, Vivaz, Ronaldo Fraga or GIG.
The state, which launched a major ad blitz during Minas Trade, also wants to boost the fashion profile of Belo Horizonte, the country’s sixth-largest city.
“Our goal is to transform Belo Horizonte into Brazil’s capital for fashion knowledge and design,” de Brito said.
To achieve this, the city will invest to develop its fashionable Prado district, build a new exhibition and fashion center and develop design and fashion training ventures between large and small firms, among other actions.