Emerging Markets: Brazil Will Get Its First Apple Store

| Analysis

Apple confirmed on Wednesday that it will open the first Apple Store in Brazil, embarking on what is likely to prove a a promising path to growth. Brazil is one of the world's top emerging markets, but Apple has faced numerous hurdles to expanding its presence in the country. Opening an Apple Store in Rio de Janeiro could literally open doors for the company.

Apple in Brazil

The story comes to us by way of Brazilian newspaper Terra (9to5Mac first noted the story in the English tech press), with whom Apple confirmed its plans in an e-mail (Google translation).

"We look forward to the opening of the first Apple Store in Brazil, where we have long standing customers and hope to win many more every day. Can not wait to offer the unique Apple retail to the people of Rio de Janeiro and customers entire region," Apple said in that email.

Apple has also been advertising for key retail positions, but the company has not said exactly when it will open its new store. Terra reported that Apple has posted 12 job openings related to retail.

Brazil is the world's 7th largest economy, and it's the largest in South America. The country also has an emerging middle class, making it an important market for Apple to enter—Apple launched iTunes and iTunes Match in the country in December of 2011.

The company has been impeded from doing so, however, due some of the tools Brazil has employed to achieve its economic success, notably protectionist policies that put a stiff penalty on many imports, including computers.

Apple's devices—particularly Macs—have strong fans in Brazil, but they have a very high price on retail shelves, just as many other non-Brazilian tech products. In fiscal 2011, Apple claimed $900 million in sales in Brazil despite those hurdles and despite not having its own retail presence in the country.

One thing that Apple can do to get around local tariffs would be to make some of its products in Brazil itself. Reports have been circulating for the last two years that Apple and Foxconn were working on opening up operations in Brazil. This would allow Foxconn to tap the large Brazilian work force, while Apple would be in a position to sell goods as local.

Whether or not that is happening, however, the reality is that Brazil represents the second best growth opportunity outside of China. Brazil is growing, has an economic model that is manageable, and it has the growing middle class mentioned above.

A flagship store in a world-class city like Rio de Janeiro could have a similar effect in Brazil as Apple's flagship stores did in Beijing and launch the brand in a big way.

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Comments

SoWhat

There has been 2 Apple Stores in South Africa for a while now. Only the iFans go there.

Why should we care?

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