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Warehouse in Sao Paulo: Amazon's Effect on the Brazilian Market

By Retail CIO Outlook | Wednesday, February 13, 2019

The Brazilian economy is one of the largest economies of the world and the largest in Latin America. According to research by BBVA, the Brazilian economy is predicted to grow by 2.2 percent in 2019 and 1.8 percent by 2020. Thus, the competition is continuous to take hold of this large market.

Amazon has decided to further expand in Brazil. It has recently launched a full-scale retail website to sell over 120,000 products of almost 15 categories. Amazon entered the Brazilian market in 2012. But, Amazon's growth in Brazil was slower compared to other countries. As an example, Amazon invested $5.0 billion to grow in the Indian market. Despite being a top e-commerce provider of India, it confronts with fierce challenges from Flipkart or Snapdeal. Microsoft's partnership with Tencent and eBay to raise $1.4 billion for Flipkart made the Indian market more complicated.

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Amazon is a giant in the e-commerce sector. It is continually investing in new technologies to offer a better service to the customers. It is trying to grow its fully-electric delivery system, Amazon Scout. It has been designed to reach the package safely to the customers. The devices started working in Snohomish County, Washington. Previously, Amazon announced its Delivery Service Program (DSP). This was an initiative to help the entrepreneurs wanting to grow businesses delivering Amazon's packages. Amazon also made a partnership with Mercedes-Benz. Amazon's smart speaker Alexa is an important step in the field of AI. Alexa can play music, create to-do lists, set alarms, and can provide information about weather, traffic, and sports.

The company is controlling a warehouse in Sao Paulo. Amazon has announced a Fulfillment Center which according to the company will create a lot of job opportunities. It has announced an agreement CargoX. But, some factors may hinder the growth of Amazon in Brazil. The complex tax structure and the different payment system are the troubles that the company has to face.

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