{"id":3392,"date":"2023-03-30T06:41:51","date_gmt":"2023-03-30T11:41:51","guid":{"rendered":"https:\/\/www.lopezjames.com\/?p=3392"},"modified":"2023-03-30T06:41:51","modified_gmt":"2023-03-30T11:41:51","slug":"what-is-the-commercial-opportunity-in-latin-america-for-overseas-businesses","status":"publish","type":"post","link":"https:\/\/www.lopezjames.com\/es\/what-is-the-commercial-opportunity-in-latin-america-for-overseas-businesses\/","title":{"rendered":"What is the commercial opportunity in Latin America for overseas businesses?"},"content":{"rendered":"

Now is the time to consider launching your business in the Latin American market.\u00a0 That\u2019s the message from one of the region\u2019s leading advisors to businesses who are expanding across one of the world\u2019s most dynamic – and resilient – economies.\u00a0 We talk to Fernando Merchan, partner with the professional services and Business Process Outsourcing group, Lopez & James, from their offices in London, about the prospects for inward investment.<\/p>\n

\u201cThe fundamentals of Latin America make it a good bet for growth as the global economy recovers from an uncertain 2022\u201d, says Merchan.\u00a0 \u201cDespite all the challenges of the pandemic and political uncertainty, Latin America remains a story of positive fundamentals for investors: the demographics, a growing, affluent middle class, a young, digitally-literate population, urbanisation and development.\u00a0 Added to those fundamental factors, many sectors, services and consumer goods verticals are poorly-served or under-served by local players.\u00a0 Quality and niche brands have huge opportunities to find new customers.\u00a0 And the transformation in digital channels to market means that these segments can be reached and become loyal customers more easily than ever before.\u201d<\/p>\n

It’s an optimistic perspective echoed by many institutional commentators who analyse investment flows and the economic performance of the region.\u00a0 The uncertainty surrounding the US economy over the last 18 months, whose fortunes dictate so much of what happens in Latin America, appear to be receding.\u00a0 In an overview of the prospects for the region, JPMorgan said that 2022 data and economic conditions had been surprisingly positive.\u00a0 It now looks as though the long-anticipated US economic downturn may be less severe than predicted by many.\u00a0 Latin American inflation has likely peaked and consumer confidence will strengthen as a result.<\/p>\n

\u201cWe are seeing a lot of new enquiries from European, Asian and U.S. based companies who see a much better outlook for 2023 than in Q4 2022.\u00a0 They are pushing forward with their expansion and investment planning\u201d, continues Merchan.<\/p>\n

According to Merchan, there are 4 factors why foreign companies continue to see the investment appeal in Latin America.<\/p>\n

    \n
  1. \u00a0 \u00a0 \u00a0 There has been huge deal and investment activity in Venture Capital and Private Equity-backed businesses \u2013 as well as from corporate buyers.\u00a0 Over the last 5 years, foreign investors have been very active.\u00a0 There has been a maturing in the start-up and fast growth sector.\u00a0 Funds and corporates are finding that local founders and Latam management teams are better prepared and aligned to what overseas investors are looking for.<\/li>\n
  2. \u00a0 \u00a0 \u00a0 Spectacular Latam company growth stories are everywhere you look.\u00a0 Businesses with CAGR (Compound Annual Growth Rates) of 20-40% over the past 5 years, are not uncommon.\u00a0 \u201cInvestors and corporates looking for acquisition opportunities will find plenty of interesting brands and targets across most sectors\u201d, says Merchan.<\/li>\n
  3. \u00a0 \u00a0 \u00a0 The financial services sector which, globally-speaking and in the region, has come through the pandemic in good shape, receives approximately 40% of total regional capital invested led by fintech, followed by Consumer Good & Services (20%) and Industrials (20%).\u00a0 But Technology, Digital Banking, Green investment and ESG investment are getting particularly focus.\u00a0 \u201cFrom Healthcare to Luxury goods, our commercial teams are seeing businesses analysing the opportunities\u201d, adds Merchan.<\/li>\n
  4. \u00a0 \u00a0 \u00a0 Geographically speaking, Brazil, Mexico and Colombia are the markets who receive the most in-bound investment and attention.\u00a0 But Central America and other countries are also seeing plenty of attention.<\/li>\n<\/ol>\n

    That said, Merchan emphasises that there is a right way and a wrong way to approach business expansion and investment in the region.\u00a0 \u201cWhat we say to clients is to keep in mind 3 points\u201d, continues Merchan.\u00a0 \u201cFirst, not all Latin American markets are the same.\u00a0 Each market has its own strengths and challenges.\u00a0 And it\u2019s important to have someone to help you navigate through the legal, risk and cultural issues which vary according to country.\u00a0 The rule of \u2018one size fits all\u2019 definitely does not<\/u> apply in Latin America.\u201d\u00a0 Second, a great way to launch is to explore local partnerships.\u00a0 That means finding an established player, supplier or platform that knowns the market and has distribution channels already in place.\u00a0 This can de-risk the initial phases of expansion.\u00a0 Third, if you do decided to set-up something new without a local partner, do your homework.\u00a0 \u201cThe single most important thing is to validate your company\u2019s product-to-market fit.\u00a0 Follow those tips, and you are off to a good start.\u201d<\/p>\n

    As 2023 progresses, many commentators are expecting a steady and positive performance from the Latin American markets.\u00a0 That\u2019s good news for investors and foreign businesses looking to find new customers beyond their current markets.<\/p>\n

    About Lopez & James<\/strong><\/p>\n

    Lopez & James is the leading professional services group that provides commercial, legal, accounting and tax advice for high-growth businesses expanding across Latin America.\u00a0 The firm offers a range of ready-to-implement solutions including market entry analysis, customer research, virtual sales teams, business planning, trade and export permits, company incorporations and a full outsourced platform offering your day-to-day payroll, accounts and local tax needs.<\/p>\n

    Contact Lopez & James today for an introductory call and to find out how its teams can help the growth of your business.\u00a0 [contact@lopezjames.com<\/em>]<\/p>\n","protected":false},"excerpt":{"rendered":"

    Now is the time to consider launching your business in the Latin American market.\u00a0 That\u2019s the message from one of the region\u2019s leading advisors to businesses who are expanding across one of the world\u2019s most dynamic – and resilient – economies.\u00a0 We talk to Fernando Merchan, partner with the professional services and Business Process Outsourcing Continue Reading <\/a><\/span><\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"translation":{"provider":"WPGlobus","version":"3.0.2","language":"es","enabled_languages":["en","es"],"languages":{"en":{"title":true,"content":true,"excerpt":false},"es":{"title":false,"content":false,"excerpt":false}}},"_links":{"self":[{"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/posts\/3392"}],"collection":[{"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/comments?post=3392"}],"version-history":[{"count":2,"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/posts\/3392\/revisions"}],"predecessor-version":[{"id":3394,"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/posts\/3392\/revisions\/3394"}],"wp:attachment":[{"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/media?parent=3392"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/categories?post=3392"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lopezjames.com\/es\/wp-json\/wp\/v2\/tags?post=3392"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}