brazil education market research

7/29/2019 Brazil education market research

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South American MARKET RESEARCH- BRAZIL centered -

2013.01.03

Jason Park/Global strategy Div.


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1. S/A_Overview

2. S/A_Competitiors

3. S/A_Market_Access Strategy

4. Brazil Market

- Overview

- Investment

- Education

- Franchise

- Competitors/Target competitor

- O.T.S.U

- Marketing

- Possible contact List

5. S/A Market Strategy Conclusion

Contents


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3

CountryGDP($)

Pop(M)

TradeVolume(10Bil)

Re(Lang./Korean)

Korea 21 48 891

Mexico 9.9 114 609Spanish,Korean : 15,000

M

AIN

Brazil 12 199 393PortugueseKorean 60,000

Agrentina

11 40 125 SpanishKorean 23,000

Chile 13 17 130SpanishKorean 2,500

Total

UNASUR : 12countries

Total Population : Aprox. 3.8 b

SOUTH AMERICA_OVERVIEW

Emerging as a new economic development countriesGlobal corporations Rushing to SA marketEconomy growth rate : 3~6%

Point


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4

SOUTH AMERICA_Competitors

KUMON MANAGEMENTCOMPETITORS

Base

Brazil centered running

Beginning : Mainly Japaneseimmigrants

Present : localizationS/A franchise Lank : 2nd.

Implication

Main target country : BrazilAfter launching, expanding the

neighboring countries.

Expanding market throughRegional HQ

KUMON

LOCAL

Country Centers Members Revenue

Brazil 1,802100,000~110,000

$34 mil(376)(2005)

Argentina 40~45 3,000~4,000

ChileAprox.150

15,000

Etc

TotalAprox.1,990

Aprox.140,000

Mainly running through the Languagescholl and institute.American education_Pearson invested

[Data: kotra franchise list]


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-Brazil Government: Attracting foreign capital (Privatization)

- Main country of MERCOSURThe Bridge of S/A countries, Brand power expanding

- Steady growth of GDP rate

S/A MARKET_ACCESS STRATEGEY

-High propensity to consume of domestic market-The most population of S/A( 1.9 billion)-The upper 20% of wealth : 50% of total wealth-Sustained growth of Education and related market

-The half gross area of S/A continent with plentifulraw materials-Geographical proximity with the neighboring countries

-Relaxing the regulation of Foreign investment

Global Corporation _STANDARD

BRAZIL MARKET

(PRORIRTY TARGET)

Expanding to Neighboringcountries

(ARGENTINA, CHILE, PERU,etc)

Hub &Spoke

Common Factor

Social/Cultural Factor

Location/Law factor


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S/A MARKET_BRAZIL_OVERVIEW

Item Brazil

PopulationAprox 1.9bil

0~14 years : 26.2% (aprox. 0.5 bil.)White (48%)

Main CityBrazilia, Sao Paulo, Rio de Janeiro, Porto

Alegre

Language Portuguese

GDP $12,374

Growth Rate 2.72% (2011)

Inflation Rate 5.24%

UnemploymentRate

6.5%

Private Education GDP 4~5%, Government budget 10%

Urbanization 81.0(Service industry : 66%)

Illiteracy rate 10%

Higher education 14%

Poor strata 22.4%

Korean Aprox. 60,000

The host country of Olympic(2016) and World-cup(2014)The centered country of BRICS market and HQ of S/A market


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S/A MARKET_BRAZIL_INVESTMENT

1) Type of establishment of company

Branch office

Designated representative (Brazil habitant)Stake 51: 49Payment of capital -> Increasing expensesThe permission of federal government (3~6months) -> Time-consuming, managementsupervision, HQ joint responsibility

Incorporation

The generous process of foreign corporationNo need the permission of governmentType: LTDA ()or SA()

Mainly establish a corporation sole and management

Disadvantageous/unfavorable wayAdvantageous way to launch the company

Reason : Responsibility separation of HQ, Local

capital procurement

2) Korean company investment

Item Contents

Trend The continuous growth : Car, Chemistry, Electronics industry

Incorporation/Amounts Total 22 companies/$7.3bil

Main company Samsung, LG, POSCO, CJ, Hyosung, Hyundae, Doosan,etc

Korean Franchise

Morana

Accessory store : Located in the most of main shopping centers in Sao Paulo-30 franchise in the 15 states-Investment: 70,000 R$, Franchise fee : 20,000R$-Revenue per month : Aprox. 40,000 R$(2,000)


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S/A MARKET_BRAZIL_EDUCATION

course Period contents Students

Pre-School

(Pre-Escola)

Kindergarten

(Educacao Infantil)

0~6years

5yearsBasic Alphabet

55,942,047Primary

(Primeiro Grau)

Elementary/Middle

(Ensnio Fundamental)

7~14

(8years

Mandatory)

Compulsory education system

95.7% enrollment : Bright future and

big market volume

Holdover rate : 53%

Second grade

(Segundo Grau)

Highschool

(Ensnio Medio)

15~17

3 years General/vocational 8,906,820

Higher Grade

(Facodade)College/University Over 4 years Enrollment Less than 20%

Education Policy : Expanding the investment plan of education : GDP 7% [4.5% (05) -> 5.0%(06) -> 5.2% (07)]

Minimum wage to 600R$ ($400) for the low income earner

Providing the opportunity of basic education

Rising the education feveras the growth of middle

class

Appearing the new consuming trend of middle class : Government assistant policy

2003~2009 years : the middle class = aprox. 320mil population

2014~ : the middle class will be aprox. 700mil population

Standard : Average income $,2,000~$3,000


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S/A MARKET_BRAZIL _FRANCHISE MARKET

Increasing 3 times for 10 years Education industry 11% of total franchise business

FRANCHISE INDUSTRY : $22.5 bil ( 23)Company : 1800, Stores : 90,000 F/C

600 971 1013 1800

5100061458 62564

90000

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

100000

2001 2005 2006 2012

company stores

Foreign company: 11%

Category of Franchise

auto

4%cloth

6%

accessory

4%

grocery

17%

education

11%

sports

15%

photo

3%

hotel

2%

computer

1%

cleaning

1%

furniture

5%

service

31%

Point


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S/A MARKET_ Brazil_Competitors

Global education rush_ KUMON, PEARSON + Local franchiseAnalysis of F/C

11% of total franchise market

( 45 R$/2)

no company centers field

1 KUMON 1802 Edu

2 WIZARD 1210 Lan

3 FISK 930 Lan

4 CCAA 843 Lan

5 MICROLINS 645 Lan

6 CAN 442 Lan

7 YAZIGI 380 Lan

8 C D I 310 Edu

9 SKILL INGLES 291 Lan

Point : Kumon ranked 1th, the last mainly running forEnglish teaching

Location : Mainly located in the center of Sao paulo,Rio de Janeiro

Growth Rate : 10% per year (total 140 companies)


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S/A MARKET_ Target Competitors

KUMON_ BRAZIL MANAGEMENT

Item Details

NameKumon Instituto de EducacaoLtda.(www.kumon.com.br)

AddressR.Tomas Carvalhal, 686,Paraiso, CEP04006-002, SP55-11-3059-3700

President Mr. Tatsuo Miyakoshi

Established 1977

Centers/

members 1,654/aprox. 120,000

Revenue$34 mil ( 376)2005

Subjects Portuguese, Math, English, Japanese

Qualification

25~50 years old womenPerson in the higher education levelAt least visiting 3 times working days per weekInstructing education required

Enrollment

Tuition fee

80R$ (\43,000)133R$/per subject(\ 72,000)

ManageVisiting 2 times per 1week1~2 hours : Question, Answer, Homework

InvestContract

Investment : 8,000R$~14,000R$ (400~800)Capital : Over 1,000R$Franchise fee : $2,300 (Including 44 hourseducation)Royalty : Enrollment 50% + Tuition 45%Monthly revenue : R$6,900 (60 members)

360

Earning rate : R$3,600 (55% )Contract terms: 2years


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S/A MARKET_BRAZIL_O.T.S.W

Threats

-- --

Strength Weakness

Opportunities

O TS W

The low brand image against KumonThe poor education environmentIndifference of private educationThe complicated taxation

The lack of culture, regulation, experienceKUMON market volumeThe lack of localization strategyBeing corruptionThe reliable partnership

Increasing of middle classIncreasing Education needsImmigrants having the interests ofprivate education(Japanese, Chinese,Korea, European, etc)Olympic, World-cup marketing andbrand

Few competitors: infant educationIncreasing of Anti-kumon customersIncreasing the favor of ForeignEducationThe biggest market volumeGovernment increases the foreigninvestment


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S/A MARKET_BRAZIL_MARKETING

PricingPremiumPricing

Target class : Over middle class

Over 10% higher price than Kumon

- Present Kumon tuition fee: R$133(\70,000)

PREMIUM Anti-Kumon

Product : Instructing English basedLearning Center : Enhancing the educationalmethod against KumonPremium L/C interior

Self_diretedMath/English

Focused

Education ERP localization

Present needs : English based

Differentiate Math and English

Self directed and instructed

Localization

Experienced

Instructor

Edu-Ministry

American HQ support : Education, Advanced skill

Reflecting the Education policy

Highly experienced instructor recruiting

POLICY


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S/A MARKET_Possible Contact List

Education company

Item Details

company POSITIVO(www.positivo.com.br)

Divertire Editora Ltda.(www. divertire.com.br)

addressR.Major Heitor Fguimaraes, 174, Seminario, CEP80440T: 55 41 3312 3671

Av. Nove de Julho, 5.435-1, Andar Sao Paulo, SP,CEP 01407-200T: 55-11-3168-4660

Person in chargeMr. Carlos Eduardo MotterMs. Sivlana Mattos

Mr. Norair Marques

E-mail [email protected] [email protected]

informationEstablished in 1972, The first leading educationbusinessEducation software, dictionary, computer sales

Established in 1998Education software for infant and elementaryEnglish publishing

employee 3500 50

source Sourced by KOTRA in 2008/contact for the possibility for Joint business or what else

Wish List

Item Name E-mail contents

Brazil Sara.Carneiro [email protected]

Received the wish mail and market researchArgentina hernan.ladeuix [email protected]

Chile ADOLFO DIAZ CARRERAS [email protected]

Etc Experienced Korean contact list / Korean franchise (ex: Multiexpress Represtacoes)
mailto:[email protected]%C2%A0mailto:[email protected]%C2%A0mailto:[email protected]


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S/A MARKET_BRAZIL_STRATGEY CONCLUSION

StrategicApproach

Management

Marketing

Main city : Sao Paulo MFC or FC trail market Expanding and HQ establish

Managed by reliable women(Kumon)Experienced manager andKorean

Premium PRICING, PRODUCT Differentiate marketing againstKumon

The biggest market volume (Kumon) Pilot test market before HQ Reliable partnership searching

To decrease the Risk of management- The experienced manager or Korean(Opinion of KOTRA)

Reliable business partner whoexperienced the foreign company andbusiness

Emphasis the importance of education Regular PR and education policy Aggressive marketing : English, Math

ITEM STRATEGY REASON


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S/A MARKET_BRAZIL_WORK PLAN

The detailed market researchThe segmentation of possible company and person

The approval after trial management

MARKET

RESEARCH

MarketSegment

SelectPossibility

ApprovalContract

Trail market

Analysis

Target location

competitors

possible contact list

Report the ongoing

process

Modification the

strategy

The specific market

report

Possible person

searching

Possible company

searching

Discussion and

adjustment

Report the plan

Pilot market

The plan approval

Final decision for

the launching

Location research

Contract

Marketing and

Education strategy

1M 2M 1M 1M


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E.O.D

Q&A

Exchange rate : $1 = R$1.80 (Present : R$2.00)Reference : ABF statistics, Economy DCI, KOTRA

brazil education market research

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