Transforming a Brazilian Agriculture Company with Strategic Countertrade Mechanisms: 100% Revenue Growth and Global Expansion in 100 Countries
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Our client is a mid-sized agricultural company based in Brazil, specializing in the production of various crops such as soybeans, corn, and sugarcane. They sought to expand their operations globally and find long-term, strategic trading partners to trade with. The client faced challenges in accessing new markets, reducing production costs, and optimizing their operations for maximum profitability.
The main problem faced by the client was the difficulty in finding long-term, strategic trading partners to trade with. This prevented the company from accessing new markets, optimizing their production capacities, and increasing their revenues. Moreover, high production and transaction costs were limiting the company’s growth potential and profitability.
As countertrade experts and consultants, we implemented multiple countertrade mechanisms to address the client’s challenges and transform their business. The mechanisms used included Counter-Purchase, Offsets, Build-Operate-Transfer (BOT), Joint Ventures (JVs), and Framework Agreements.
Counter-Purchase: We assisted the client in establishing counterpurchase agreements with major agricultural importers. This allowed the client to export their crops in exchange for importing high-quality farming equipment and technology.
Offsets: We facilitated offset agreements with suppliers in various countries. The client agreed to purchase agricultural inputs from these suppliers, who in turn invested in the client’s production facilities and technology, leading to a 50% reduction in production costs.
Build-Operate-Transfer (BOT): We helped the client set up a BOT agreement to establish a new processing plant in a foreign country. The client built and operated the facility for a predetermined period before transferring ownership to the local government, allowing the company to access new markets and expand their product offerings.
Joint Ventures (JVs): We supported the client in forming joint ventures with local partners in target countries, enabling them to establish a presence in these markets, share resources, and expand their distribution channels.
Framework Agreements: We guided the client in setting up long-term framework agreements with trading partners in 100 countries, ensuring consistent and reliable access to new markets and customers.
Through the implementation of these countertrade mechanisms, the client achieved remarkable results:
Expanded their business globally into 100 countries within 60 days.
Increased sales revenue by 100%.
Established new supplier bases in 100 countries.
Gained new customers in 100 countries.
Reduced high production and transaction costs by 50%.
Optimized excess capacity and underperforming activities.
Our strategic implementation of multiple countertrade mechanisms transformed the Brazilian agricultural company into a highly profitable enterprise. By leveraging countertrade, the company successfully expanded its operations globally, accessed new markets and trading partners, and significantly increased its revenue while reducing costs. This case study demonstrates the power of countertrade in overcoming challenges and achieving remarkable business results.
What YOU CAN DO TO
ACHIEVE SIMILAR RESULTS
If you are facing similar challenges to those encountered by our clients in this case study, you can consider implementing the following countertrade mechanisms:
Counter-Purchase: Establish agreements with buyers where you agree to purchase goods or services in exchange for their purchase of your products.
Offsets: Facilitate direct and indirect offset agreements with suppliers in different countries to penetrate new markets while supporting economic development in the buyers’ countries.
Joint Ventures (JVs): Establish strategic JVs with local partners in targeted countries, allowing you to leverage local expertise, resources, and market connections.
Build-Operate-Transfer (BOT) and Build, Transfer, and Operate (BTO): Set up BOT and BTO agreements for building and operating facilities in several countries, eventually transferring ownership to the host countries after a specified period.
Framework Agreements: Establish long-term framework agreements with trading partners, ensuring stable and predictable trade relations.
HOW WE CAN HELP YOU
ACHIEVE SIMILAR RESULTS
At our countertrade consulting firm, we offer specialized expertise in identifying and implementing countertrade mechanisms that suit your specific business needs and challenges. Our team of experts works closely with you to develop a tailored countertrade strategy and assist you in executing the plan. We offer the following services to our clients:
Market research and analysis to identify potential trading partners and assess their suitability for countertrade mechanisms.
Negotiation and structuring of countertrade agreements, including legal and contractual documentation.
Development of a detailed implementation plan for each countertrade mechanism, including timelines, milestones, and resource allocation.
Monitoring and evaluation of each countertrade agreement to track progress and success.
CASE STUDY SUMMARY
Our case study showcases the success of countertrade mechanisms in transforming businesses facing challenges in international trade. By implementing multiple countertrade mechanisms, our clients achieved remarkable results, including exponential growth in sales revenue, expansion into new markets, establishment of new supplier bases, and reduction of production costs. Our strategic approach to countertrade and tailored implementation of multiple mechanisms enabled our clients to overcome challenges and achieve substantial growth in highly competitive global markets.
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