• Creimerman Product Team

Brazil: The advantages of nearshoring for foreign business


Nearshoring is closely related to outsourcing, so this is a good place to start for context. In manufacturing and IT, many corporations operating out of Europe and the United States encounter issues when trying to manufacture or manage their products and services in their country of origin, therefore, many of them look overseas where opportunities are greater, and costs are lower. Yet, referring back to the pandemic and also introducing the theme of geopolitics, distance becomes a crucial factor, and coincidentally is also where nearshoring comes into play. Essentially, the cross-border companies take into consideration a number of factors yet the one that underlies all of them is the proximity, this is to say, the new manufacturing or outsourcing location is much closer to the country of headquarters which leads to a number of other benefits.


This background is important in establishing the foundations for our specific theme for today, Brazil. In other words, we will be investigating why Brazil is such a good choice when it comes to nearshoring, as although we have previously alluded to it being great in the IT world, it is important to recognise the potential existing across a broader range of markets.


A good place to start is with the IT sector, as this best represents the nearshoring success already found in Brazil. Number one in Latin America and number thirteen overall globally for software development outsourcing, it is clear that Brazil is an unmissable contender for nearshoring. One of the most interconnected nations in the region, Brazil is only ever a direct flight away from the US and Europe, making outsourcing not only convenient, but also a necessity. It is also said that there are over 400,000 software developers in the nation, and so the idea we mentioned earlier of each client having their own specific requirements, it is likely that a business of any size involved in any market would be able to find someone capable of assisting them. Not only this, but beyond the 400,000 developers, there is an overall estimated figure of 2 million people who work in IT in the nation, broadening the capability of the workforce and serving to further attract foreign businesses to Brazil.


With the sector-specific example out of the way, we can look at some other advantageous factors that make Brazil a contender for nearshoring by North American businesses.


One of these is the time difference. This is because Brazil is only 2 hours ahead of the Eastern Standard Time, making it so that workdays broadly overlap and facilitate communication and productivity, whether it be through meetings or dependability. Having a similar time zone also works to permit greater innovation and last-minute changes, both of which can work together to allow the main business and the nearshored business to develop exponentially and widen profit margins.


The other key advantage is the proximity, geographically speaking, which underlies the idea of nearshoring, but has secondary benefits stemming from it, such as shorter travel times for business trips, as well as shorter shipping times if the business being nearshored is manufacturing related. These are significant benefits as they allow for businesses to remain at optimum performance levels and to limit their chances of damaging unforeseen errors hindering progress.


So, if you are interested in finding out more, get in touch with us today! At Creimerman, we are a team of global citizens, working with each client and providing a tailor-made service in order to help make their cross-border ventures a success, and we would love you to be the next.

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