Transcript Leather Footwear Industry Brazil

Leather Footwear Industry Brazil
RKC Team Project
RESIDENTIAL – Michel Porter on Corporate Strategy
and Competitiveness, 2010
Team Members:
David Valentyne, Riham Hwaidi, Sasa Cvijic, Sphelo Ntaka
Project Team & Work Distribution
Project Time Frame
Phase One
Phase Two
Final Phase
23 Feb – 7 March
8 March – 21 March
22 March – 10 April
Research,
Information
gathering and
Data collection
Data Analysis,,
Strategies
Analysis, Cluster
analysis
Compilation of
the report and
final Report
Submission
Draft review with Prof. Duffill by 26 March
Project Rationale (1)
 Brazil is the 5th largest economy on the planet with a population of 180m & occupies a diverse
geographic position attracting foreign investment.
 It boasts the world's largest commercial cattle herd resulting in diverse chain of associated & allied
industries.
 Brazil has been in the leather and footwear industry for over 100 years & boasts the most complete
footwear cluster in the world, supported by 800 tanneries.
 The country cluster supports approx. 1,500 large, medium and small size footwear industries and
more than 5,000 micro-companies and ateliers.
 The footwear chain further features 2 thousand industries of components for leather and footwear,
and of industries that produce machineries and equipment.
 The industry generates 1 million direct & indirect jobs: 400 thousand in the footwear industry; 400
thousand in the footwear retail; and the rest is divided among tanneries, industries of components,
and industries that produce machineries and equipment.
This is an industry cluster that can rightfully be considered a giant by any measure.
(1) Resource: http://www.brasil.gov.br/ingles/economy/Investments
Key Content
A.
Overall economic performance & cluster composition of the
country.
B.
Assessment of business environment.
C.
Leather footwear industry cluster analysis.
D.
Strategies issues facing the leather footwear industry in Brazil.
E. Policy recommendations to all stakeholders in the leather
footwear industry in Brazil.
Historical Overview
1) Country Background.
2) Economic Performance.
3) Brazil Business Environment.
4) Background on leather and shoe
industry in the region and the world.
5) Concentration on period 2000-2008.
Economic Performance of Brazil
MACRO-ECONOMIC OUTLOOK
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Overview of the Four Major Emerging Markets (BRIC)
Neighbouring Countries/Region
Analysis of GDP Growth, Change in Employment and Inflation Rate
National Efficiency Indicators
Labour Mobility
National Diamond
Business Environment
Cluster sizing & export dynamics:
Brazilian share of export by sector in 2008
 Comparison size of other countries leather footwear exports (bubble chart)
 Explore Brazils reason for size (Any impacting issues to growth)
 Ability to serve to customers (what are the inhibitors, trends, supply mechanisms
& restrictions)
 How do allied industries play a role in its ability to sustain
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Follow and support with Cluster map & supporting industries (horizontal and
vertical ) (map)
At $2 bil,Brazilian leather footwear is small in relative terms to rest of exports
But remains a giant in terms of industry relationship value to rest of economy
Frame Brazils cluster size vs. rest of world
Provide situational evidence of cluster dynamics
Brazil Global Customers
Who are Brazil’s Global Customers:
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Export size to world countries (bubble map)
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Why these countries & is exposure blocked to other countries for any reason
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What is the Return value to Brazil (monetary or otherwise)
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How easy is it to achieve exports to these customers (who supports & who acts as
adversary / explore why
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What are the Trends & what does that means for the future exposure of Brazilian
exports
Indicate who Brazil is trading with…
Indicate how this is achieved…
Competition & Competitors
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What are the competitor’s doing (better or worse)
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What is their growth trend vs. industry trend
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What does this mean in world leather footwear dynamics as as local country
dynamics
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Cluster Competitive SWOT (diagram)
(1) Context for strategy & rivalry
(2) Factor conditions
(3) Demand conditions
(4) Related & supporting industries
Complete competitor analysis (SWOT)
What position does this leave Brazil in….
Cluster Analysis
 Historical development, size and performance of cluster
 Companies
Size and number of companies in the cluster relative to national average
Ownership , Market segment and specialization, Suppliers
Cluster diamond
 Distribution
Who are the distributors
Difference national / for export
What is the ‘Route to market’ (is this the best & most meaningful method)
 Specialist education
Institutes, universities, R&D
Production process improvement
 Effectiveness & performance, Application of knowledge