Trade between Latin America and Australia certainly isn’t a new thing, but it’s only within the past ten years that business relationships have picked up a notch. LATAM and Australia commercial relations have never been more lucrative, and as such, entrepreneurs are taking to Australia to sell their quality products and services and add revenue streams to their businesses. If you’re an experienced businessman in Latin America, you could do the same.
In 2017, Australia imported more than AU$6,350 million from Latin American markets, with agriculture, services, minerals, manufactured goods, and fuels at the top of the list. Australia exported more than AU$4,752 million worth of product to territories like Brazil, Chile, and Mexico, showing that whichever side of the globe you’re on, LATAM/Australian relations can work for you and allow you to maximize profitability and forge lasting business relationships.
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Business Expansion from LATAM to Australia – Assess Demand
Before you get ahead of yourself and book the next flight to Australia, it’s important to weigh up demand for products and services in your niche, and see where there are gaps in the market that could be filled by your expertise and team. There is little point in entering into the country and investing thousands of dollars into a new business venture if consumers aren’t looking for your wares, so do your market research and understand
Incorporate Your Business In The Country
If, after assessing the demand for your products and services, you are convinced that you can make it work, then your next step is to form a company in Australia. The company incorporation is a relatively straightforward process, with four key business entity strands for you to consider.
A sole trader, for example, is great for one-man-bands and solo entrepreneurs trying to make a name for themselves, whereas a partnership allows you to share legal responsibility of your business with one or multiple business partners. A company is the next step up, shifting the responsibility of taxes and profit and loss from individuals to the company, and a trust is a suitable option for business and investment purposes. The good news is that you can start as one company formation, and work your way up as your needs change. Each entity type offers benefits and drawbacks, like taxation, the responsibility of employees, and so on.
Tap Into Trade Agreements
One of the biggest reasons why so many Latin American entrepreneurs choose to invest in Australia is to take advantage of LATAM-Australia business opportunities. There are various trade agreements and alliances between Australia and Latin America, allowing you to export and import goods and services between your two countries for the purpose of selling direct to consumers, or to add value to raw materials through manufacturing and marketing.
The New Free Trade Agreement between Peru and Australia (PAFTA), for example, was only brought into effect in February of 2018 but allows Australian businesses to capitalize on Peru, which is one of the fastest-growing economies in Latin America. Trade in goods and services between Australia and Peru was worth $590 million in 2016, but that figure is set to rise exponentially as multinational businesses like yours tap into the agreements and deals.
The Australia-Chile Free Trade Agreement (2009) and The Cairns Group (a group comprising of Argentina, Australia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Pakistan, Paraguay, Peru, the Philippines, South Africa, Thailand, Uruguay, and Vietnam that aims to achieve free and fair trade in agriculture) also open new opportunities, whilst ongoing talks for new trade agreements such as the Pacific Alliance-Australia Free Trade Agreement will create new foreign investment opportunities.
To maximize your profitability and add legs to your Australian venture, you should be on the ball when it comes to new trade agreements, tuning into news related to your niche. Indeed, if a new agreement launches between your native country and Australia, you should grab the opportunity with both hands to gain market domination before competitors stand a chance.
Localize Marketing and Networking
Whether you want to sell products and services directly to consumers or you’re working with business partners to tap into lucrative B2B markets, localizing your marketing to suit the Australian populous is critical. Indeed, a marketing campaign in Mexico cannot easily be translated to work for an Australian audience, and so investing in a marketing manager and developing a strategy for sales and brand awareness is critical. Do not underestimate the power of an effective digital marketing strategy to drive business when operating in Australia.
Networking is also critical. Australians are known for their laid-back approach to business and do not take themselves too seriously, so adapt to their way of thinking and attend networking events, conferences, trade fairs, and exhibitions to meet key decision makers and put your name in front of the people that matter. Recruiting business development experts could be an option to ensure your business propsers.
Expand into Australia with Biz Latin Hub
There are endless commercial opportunities for Latin American businesses wishing to operate in Australia, with key industries in agriculture, energy, and tourism topping the lists.
To maximize your chances of success, we highly recommend hiring back-office support services from a business with local expertise. Consider Biz Latin Hub Australia, whether you are looking for assistance with recruitment, visa processing, commercial representation or more. You can contact the team today for personalized support.