Doing business in Argentina
Striving for positive potential in business exports and still the best-educated workforce of any Latin American nation, Growing Business looks into trading in Argentina...
Argentina is striving to create a positive outlook for business and trade after years of political and economic instability. However, the turbulence of previous years has taken its toll; many companies still struggle to look beyond the short-term, and consumers are still wary of spending money on luxuries and overseas products.
Despite the recent problems, Argentina still has the best-educated workforce of any Latin American nation, so there is genuine potential for anyone wishing to export to this country.
Capital: Buenos Aires Major industrial centre: Cordoba Other major cities: La Plata, Mar del Plata, Mendoza, Rosario Language: Spanish Currency: Argentine Peso (APS) (although some countries will trade in dollars) Key trade partners: Brazil, Spain, US
Argentina is renowned worldwide for the quality of its agricultural produce, particularly its beef. However the country is active in many different industrial and commercial centres, with premises spread across all the major cities.
For example, Cordoba is a hub of heavy industry, metalworking and motor vehicle production; Buenos Aires is a vibrant centre for food processing, consumer durables, textiles and petrochemicals; and Rosario houses dynamic steel, oil and agricultural vehicle industries.
To find out which industries are big in Argentina, and where, visit the following link: http://www.nationsencyclopedia.com/Americas/Argentina-INDUSTRY.html.
Advertising and distribution
TV and pay TV advertising is booming in Argentina, so you may wish to promote your product along these lines. Telemarketing is also well-established in the country, and trade shows generally provide fruitful returns.
Larger firms tend to prefer buying directly from overseas suppliers, while smaller companies prefer going through intermediaries such as agents and distributors.
Argentines tend not to be that loyal to particular brands, so advertising may not foster the long-term customer relationships it can yield in other countries.
Culture and etiquette
Argentines are very status-conscious. Just like the UK, Argentina has a rigid class system, so you need to respect the background and education of the person you’re talking to.
Bosses and managers in Argentina are particularly keen on respect; they’re used to being obeyed and revered by their subordinates, so you need to massage their egos and listen carefully to everything they say.
Vague, waffly communication won’t cut it in Argentina – the people are used to clear guidance, so you need to be firm and concise when sending orders and instructions.
Given the problems of recent decades, many Argentines are wary of strangers and foreigners. Trust is invariably earned, not given automatically.
Meetings and correspondence
Argentines generally prefer face-to-face meetings to written correspondence and conference calls, so you should try to visit your clients if possible.
However, be prepared to spend ages talking about non-business issues before the meeting begins in earnest. If you’re not keen on football, it might be a good idea to swot up – Argentines are mad on it!
Argentine companies will expect you to turn up on time at meetings, but they may veer off an agenda – so be prepared to go with the flow!
Argentina is trying to protect its fragile economy with protective tariffs, and companies wishing to ship goods into the country will probably be hit with a customs charge of between 5 and 14%.
If you wish to export goods to Argentina, you’ll have to register as an exporter with the Argentine Customs via the Directorate General of Taxes. An automatic licence procedure is also necessary for certain products.
The Argentine Customs office also runs a goods classification system to determine whether imports require checking upon entry to the country. It’s best to check where your product fits into this system before you ship it.
Finally, the Ministry of Industry requires receipt of a form declaring quantities and composition of all products, 10 days before they clear Customs.
Other things to bear in mind
The organisational structure of an Argentine company may differ markedly from that published on a chart or website – so you need to make absolutely sure you’re dealing with the right person.
If you wish to carry on the same activity in Argentina for several months, you’ll probably be expected to establish a local branch, with a legal representative. However, you won’t be require to back the branch with capital.
Argentines are, on the whole, wary and choosy when it comes to their purchasing habits; many were stung by the economic crash at the start of the Millennium, and don’t want to spend beyond their means. If you’re planning to sell high-price consumer goods, this is definitely something to consider.
You can get basic information about Argentina, its society and its economy by visiting the Export to Argentina website. The Federation of International Trade Associations also runs an excellent guide on Argentina, and World Business Culture provides a comprehensive country guide.