EX106SBeshonerASSN1
1/20/06
Geographic Inventory:
Company: Paxton
Market: Consumer Fans
Project: Paxton is a leading provider of residential air circulators in the United States.
Paxton is preparing to establish a manufacturing/assembly facility in Sao Paulo, Brazil
for distribution in the surrounding communities.
Country: Brazil
The following is an executive summary of additional issues which should be considered
by Paxton in preparation of the Brazil project:
Culture:
A majority of the population is of Portuguese decent. Portuguese is the primary language
with Spanish, English and French also present. The language variations and
concentrations in the planned retail markets should be understood and considered in
advertising and package labeling.
Economic Conditions:
As a developing nation, Brazil has experienced high inflationary conditions in the past.
There is a high degree of income disparity between the wealthy and poor residents. Such
factors may impact the size of the customer market and/or impact the product offerings
necessary to meet affordable price points of various customers.
Regarding electrical availability, there are differences in the voltages depending on
location (110 and 220). Product variations and the need for adapters/converters as
accessories to the products should be considered.
Political:
Historically, political corruption has been present in the Brazilian government. An
assessment should be made as to the stability and level of risk associated with current
policies and judicial practices. Tax law, contract law, and product liability should be
investigated specifically.
Safety and security can be an issue in Brazil. Adequate security for company assets and
employees could result in added expense.
Geographic:
The population of Brazil is heavily concentrated in urban areas in the south central
portion of the country. This could have a favorable impact on the ability of Paxton to
maximize market penetration while minimizing distribution networks.