Latin America: The China of 2020, Sizing Up the Opportunity
Size does not really matter …well, sometimes.
In terms of sheer size, China, with its 1.4 billion residents who speak 120 officially recognized languages, stands as the most populous country on Earth by far. However, they are not consumers of most of the products and services we buy and sell here in the U.S. Thus, for companies looking for the next market to expand to, Latin America shines as the new frontier of opportunity for market growth and expansion. Aside from the obvious logistical advantage due to its proximity, these 21 independent countries have more in common with themselves than the single country of China.
For starters, the infrastructure is already in place for getting products and most services to nearly all Latin American markets, consumers are easy to reach, communication materials need only be in Spanish and Portuguese and the numbers are there to substantiate the effort. The Latin American consumer base has grown to 170 million customers that purchase products and services as we do here in the U.S. Of utmost importance, this number is growing by double digits every year. Yes! 170 million strong and growing. At the current pace, there will be a total of 260 million consumers like us by 2020, out of a total population of about 670 million. So when we look for the future labor or consumer markets to come, our own back yard has the best upside potential yet. I do admit it could be challenging for the typical American company to try to set up a beach front in Latin America, but here again, if you know what you’re doing, it always tends to be easier; if you do not, it is always going to be harder.
Latin America stands to yield a much better opportunity for North American companies looking for a quick and very cost-efficient way to grow their sales, protect their global market share from European and Asian products that have already made great inroads and possibly even achieve brand leadership status in the hemisphere. The return on investment in Latin America has no equal.
In my next segment I’ll elaborate more as to the stats behind the why.
Stay tuned the next installment of our China 2020 series.
