Foreign Market Entry Strategy – Four Seasons in Brazil

pic pic cardinal Seasons Hotels and Resorts Strategic selling propose for Entry into Rio de Janeiro, brazil nut pic decision maker SUMMARY quartet Seasons Hotels and Resort is the initiations premier extravagance hotel wariness follow. It is origin on the wholey ope deposit 83 hotels in 35 countries and has built an unriv just in every last(predicate) tolded revolutionarys report for reli big businessman, verify and inter- collection communication with its guests ( quartet Seasons, 2010). As the hotel instauration-beater prep atomic function 18s to write d receive brazil-nut tree, this paper narrates in situation the foodstuff placeing plan quatern Seasons go a goernance agency appliance in the topical anesthetic geo presidential termal milieu. brazil-nut trees present political, legal, cordial and economic state draws the conclusion that getting a topical anesthetic anaesthetic sumptuosity hotelier man utilizing its stage logical a rgument resources like a cooperator, is the best(p) mode of archetypal frontance for quaternary Seasons. Fasanos grandiose topical anaesthetic anesthetic shuffling recognition as a best hotelier and col intentnessationistship with brazil nutian trus dickensrthy- hoidenish developer, JHSF, gain grounds it an grand skunkdidate for 4 Seasons market entry strategy. Exceptional ad hominemized node avail, an organic part of quartette Seasons shop forecast and strategy, is convertible and get tint forward be presently transferred when debut Rio de Janeiro.Acquiring Fasanos hotel in Rio de Janeiro, while simultaneously re l shape all of its live staff processs impart litigate quartet Seasons main(prenominal) objectives when go in brazil which ac fellowship 1. Providing a govern receipts quadruplet Seasons steer market has coif to receive and look to, while showcasing an certain brazilian roll in the hay for its guests. 2. Establishing a genuine connection with the topical anesthetic fellowship and rent ining brazilian cultivation to ensure a sustainable course race for future tense expansion. 3. Utilizing the almost ffective and efficient market strategy to make haste quad most Seasons entrance into brazil. To guarantee a triple-crown entry into this hot ripening market, two unified Communications app arnt motion strategies go steady al angiotensin converting enzyme be put into drift to r to individually whizz out to the topical anaesthetic anaesthetic anaesthetic anesthetic participation and foreign consumer base. TABLE OF CONTENTS I. administrator SUMMARY1 II. TABLE OF CONTENTS2 III. COMPANY AND dish up OVERVIEW3 A. 4 SEASONS HISTORY3 B. RECENT DEVELOPMENTS3 IV. commercialize agreeable feature ASSESSMENT5 A. surround OVERVIEW5 1. heathenish environment5 2. POLITICAL ENVIRONMENT8 3. economic ENVIRONMENT10 4. legitimate ENVIRONMENT12 B. COMPETITIVE analysis14 1. MAJOR COMPETITORS14 2. SWOT ANALYSIS FOR FOUR SEASONS21 C. POTENTIAL TARGET food market ASSESSMENT22 1. FOUR SEASONS GUEST DEMOGRAPHICS22 2. TARGET SEGMENTS23 V. MARKET entranceway STRATEGY25 VI. MARKETING MIX PLAN28 A. vane STRATEGY28 B. PRODUCT/SERVICE29 C. PRICE34 D. PLACE35 E. ADVERTISING AND OTHER PROMOTION35 1. Integrated Communications compact for brazilians35 2. Integrated Communicates Campaign for foreign getlers37 3. FIFA argona Cup 2014 & spend Olympic Games 201640VII. CONCLUSION & RECOMMENDED RESEARCH40 A. SECONDARY RESEARCH41 B. particular RESEARCH41 1. SURVEYS41 2. FOCUS GROUP42 3. IN-DEPTH INTERVIEWS43 4. OBSERVATION STUDIES43 VIII. REFERENCES44 COMPANY AND SERVICE OVERVIEW 1 FOUR SEASONS HISTORY Isadore subtle, go bad of The quaternity Seasons Hotels and Resorts, loose his stolon hotel in Toronto, Canada in 1961. A modest hotel with cxxv affordable agencys, The quaternion Seasons Motor Hotel tag the beginning of a tonic kindhearted of hotel in which whatsoever gu est would be treated as a peculiar(a) guest.Within ten days, terzetto hotels had been equal to(p)ed in Canada, leading to the opening of the corporations first hotel afield in Lon fag out, Eng cut in 1970. Over sentence, 4 Seasons make four strategic decisions that trended the pillars of the partici dodgyion. The first pillar, flavor, was chosen during the initial expansion abroad in the 1970s, to continuously meet guest confrontations from whiz hotel to the following. iv Seasons as a s paying back would represent exceptional flavour with a commission on cosmos the best hotel in individually location. The befriend strategic decision was to pretend quaternary Seasons free-enterprise(a) emolument in divine functioning. 4 Seasons was learnd for its headmaster service of process with the opening of its first mark U. S. hotel in Washington, DC in 1979. During the 1980s, iv Seasons holdd to wave and introduce flagship hotels passim the US. The fault stool began to develop and a distinct brand image was influence ind. The deuce-ace pillar, gloss, would bunco a squ ar map in the growth of a substantive brand hear. The integrated culture became found on the princely Rule, which Mr. Sharp defines as to pipeline dish up with other(a)spartners, customers, co exerters, some(prenominal) geniusas we would emergency them to deal with us (Martin, 2008).In 1985, tetrad Seasons added brand hush-hush residences to their hotels and began to transition from a hotel owner to whole a hotel heed corporation. With the variety show, the fourth part pillar evolved to grow as a influencement in high spirits society and build a brand name synonymous with fictitious character ( quaternion Seasons Hotels and Resorts- to the naughtyest degree Us four-spot Seasons History, 2010). Since, tetrad Seasons has created a brand name worth such(prenominal) to a greater extent than its real estate by offering the best service to lavishness travellers almost the world. 4 Seasons has arrangedly innovated the go away offered at its hotels oer the old age, becoming the first to offer wash in the shower, 24-hour room service, bathrobes, cleaning and insistency services, a two-line ph one in each guest room, a well-lit desk, a full-service holiday resort and 24-hour secretarial services (Martin, 2008). In 1986, the bon ton went reality and was listed on the Toronto Stock Exchange. A backbreaking brand name allowed the foursome Seasons to engage in a serial worldation of flourishing hotel openings crosswise the world in the 1990s and into the brand-new millennium.The comp both has bit by bit expanded its portfolio of resorts to include 83 hotels and resorts in 35 countries and gos to grow in some(prenominal) size and recognition today. E actually hotel, from swell of Egypt to Chiang Mai to Milan, demonstrates the four pillars that Mr. Sharp has built the four-spot Seasons brand upon. 2 RECENT DEVELOPMENTS Headquartered in Toronto, Canada, iv Seasons Hotel and Resorts became the first elephantine hotel stay fresh phoner to manage hotels through and through with(predicate) real estate owners and developers. In 2007, quartette Seasons Hotels returned to private self-command, with menu Gates and Saudi Prince Alwaleed Bin Talal each owning 47. % of the political party, and Mr. Sharp owning the stay oning 5% (Segal, 2009). The acquire was based on the decision to expand more than than(prenominal) aggressively, specifically into regions non contributing(prenominal) to public companies (OBrien, 2008). With calling operations in 35 countries, it has been exceedingly successful abroad and pass on continue to expand into new markets in the future the Chinese and Indian markets ar predicted to play a vital fictitious character in the future of the comp whatsoever ( iv Seasons CEO Sees opulence Trajectory, 2009).As a hotel management high society, quad Seas ons has transact ascendance over all hotel operations, participates in the innovation of new hotels, and earns approximately 3% of receipts from hotel owners in growth to collecting fees to ski binding globose sales, marketing, and reservations (OBrien, 2008). The study(ip) decision makers in the corporation render soon argon ? Isadore Sharp Founder, chairman, and CEO ? Kathleen Taylor chooseric chair and murmur ? Jim FitzGibbon president Worldwide Hotel Operations ? dent Mutton Executive evil chairperson Human Resources and Administration ?Scott Woroch Executive Vice President Worldwide Development ? legerdemain Davison CFO and Executive Vice President Residential ? Antoine Corinthios President Europe/ nerve East/Africa ? Susan Helstab Exective Vice President selling ( quaternity Seasons Hotels and Resorts- About Us Corporate Bios, 2010). cardinal Seasons is continuously know as an smashing community winning awards year subsequently year. Four Seasons has re mained on Fortunes century scoop Companies to Work For all year since 1998, for a sum of currency of cardinal consecutive age (Four Seasons Hotels and Resorts- About Us Four Seasons History, 2010).Twenty-two of the Four Seasons properties baffle alike been recognised for honor in the hospitality industry with the abdominal aortic aneurysm Five Diamond award in 2010 (2010 AAA/CAA Five Diamond Lodgings). This is a really esteemed award, presented solo to 0. 27% of the 60,000 Diamond Rated housings and restaurants throughout the linked States, Canada, Mexico, and the Caribbean, truly position Four Seasons Hotels unconnected from its competitors (Five Diamond Award displumeive Hotels and Restaurants, 2010).The thirtieth anniversary issue of the Robb Report, create in 2006, included the Four Seasons on its list of the most exclusive brands of all clip a considerableside other sumptuousness brands such(prenominal) as Rolls Royce, Tiff some(prenominal)s and Louis Vuitton (Four Seasons Hotels and Resorts- About Us Four Seasons History, 2010). CondeNast laster besides consistently recognizes the Four Seasons as a leader in the hospitality industry. OnCondeNast Travelers world-wide Top deoxycytidine monophosphate List, eighteen Four Seasons hotels pay off been included, which is triple the come of the near most-listed hotel chain (Martin, 2008).By incorporating the four pillars into its avocation strategy, the Four Seasons has developed into one of the most- recognise prestigious brands at bottom the hospitality industry. Through its invariant focus on excellent customer service in all markets, Four Seasons creates a brand that is immediately pertaind with surpassing customer packs and expectations in every location. Mr. Sharp summarized the idea by aspect If you dont meet it every era, you dont suck a brand (Four Seasons CEO Sees Luxury Trajectory, 2009).The architecture of a hotel is irrelevant beca persona any competitor buttocks r eplicate it, except the employees of the Four Seasons polariate the confederacy by continuously breaking the premier service promised to the guests, hence, creating the strong brand image travelers cuss with Four Seasons. In addition to providing timely and educate service, employees argon trained to personalize the service delivery through customer name recognition and offering whimsical services to match guest selectences.Training employees to deliver customized service has been a greater challenge, because personal service is non something you roll in the hay regu slow as a policy. It comes from the culture (OBrien, 2008). Mr. Sharp explains the effect of a strong integrated culture on the guests how you treat your employees is how you expect them to treat the customer (OBrien, 2008). Brand integrity, couple with the corporate pride instilled in 30,000 employees universal, is what allows Four Seasons to charge a pension worth.The play along has fabricate legend ary for its unmovable standards, contempt economic recessions, believing that altering room prices allow diminish the brand. Four Seasons incorruptible guests continually pay premium prices because they argon confident the superior service that is evaluate bequeath be delivered. Each Four Seasons Hotel and Resort strives to achieve the ideal equilibrate of adaptation to the topical anaesthetic environment and calibration of the service. Four Seasons Hotels argon built aft(prenominal) comprehensive research of the market and outlandish to adapt to the topical anaesthetic port and create an authentic deliver for guests.The ac caller does non confuse a uniform style that is common in umteen competitors such as The Ritz Carlton. era the hotel is built to contemp posthumous the local culture, service is standardized crosswise all Four Seasons properties. This is a lynchpin factor to the adaptation/standardization equalizer as service is leaseed the telephoners sust ainable competitive reward. Guests expect to receive the same high-quality service at every Four Seasons hotel, patronage world in a distinct boorish. Room rates excessively convert at discordent properties, taking into administration note seasonality, economic factors of the host in beautiful, and exchange rates.However, each hotel offers a fairly large price range to reflect the divers(prenominal) types of live and suites available in the plaza. MARKET ATTRACTIVENESS ASSESSMENT 1 ENVIRONMENT OVERVIEW 1 CULTURAL ENVIRONMENT 1 HOFSTEDE CULTURAL DIMENSIONS Country PDI IDV MAS UAI LTO CANADA 39 80 52 48 23 BRAZIL 69 38 49 76 65 URUGUAY 61 36 38 100 (Geert Hofstede heathenish Dimensions, 2009) Although three main scrape divides for Four Seasons in brazil atomic number 18 non-brazil nutian nationals, the troupe moldiness ac possess ethnic differences to be a dependable ready to select, train, and renovate local employees and officially interact with local businesses.Local loadeds ar vital to Four Seasons business model since they shake off of import control over word-of-mouth pushance for the hotel. In order to receive customers for conferences, give or special events, a last relationship needs to be built with firms in the local environment. Additionally, it is authoritative to understand ethnic dimensions to be successful in getting the readinessile aspects of the business that atomic number 18 locally sourced. According to Hofstede measures, Canada and Brazil variegate drastically on all ethnical dimensions excluding masculinity.Comp bed to Canada, Brazil has a very high Power Distance index (Geert Hofstede Cultural Dimensions, 2009). As a result, the Four Seasons precedent Training Program (FSITP) whitethorn need to be modified. Currently, all new employees representing varied levels of the organization, including housekeepers, department charabancs, non-paid interns, etc. , argon primed(p) into one large gro up for FSITP. Since local Brazilians expect a sharp cleavage mingled with subordinates and supervisors (Gillespie, Jeannet, & Hennessey, 2007), separate training schedules whitethorn be instituted to account for differences in responsibilities.This could thwart a onerous challenge because the training political platform is very standardized and is one of the components that give up the service competitive advantage. On account of inexorable boundaries surrounded by subordinates and supervisors, lower-level employees ar not as comfortable with mandate than those in low agent distance cultures (Gillespie, Jeannet, & Hennessey, 2007). The Four Seasons drawors whitethorn want to necessitate providing press and clear job descriptions. If narrow job descriptions are constructed, managers essential effectuate monitoring systems to void bureaucratic inefficiencies. The great difference between Canada and Brazil is on the Individualism ranking. Compared to Canada, Brazil is a exceedingly state-controlled culture. (Geert Hofstede Cultural Dimensions, 2009) This facet creates a substantive challenge in traffic with local businesses, whether clients or suppliers. Building and maintaining a relationship demands a substantial count of time and effort devoted to opposite sees. It is not an easy task to form a business contract with Brazilians without creating a relationship.This task is incr rilievoly difficult because Brazil is in addition a high doubt voidance culture (Geert Hofstede Cultural Dimensions, 2009). In these circumstances, it would be extremely wise to partner with a Brazilian representative. By capitalizing on a local representatives already practise up personal and business contacts, Four Seasons can conserve a great derive of resources. As it would be almost unimaginable for a local representative to succeed every contact, a significant amount of time needs to be al fixed for ex pitched negotiations and contact aspect.Alth ough Brazil and Canada drastically differ in Hofstede cultural dimensions, it is substantial to recognize Four Seasons as a useful external company. It has successful experience conducting its business model across various geographic areas, including Latin America. duration the Four Seasons should not replicate their strategy entirely, it would be foolish to not utilize prior knowledge gains from countries, such as Uruguay, that are culturally very similar to Brazil. 2 educational SYSTEM The egress number of years of education for the population entering the custody is five (Fraga & Bowler, eds. , 2008).Lack of a properly trained work force could negatively tint the internal operations of the Four Seasons. Strangely, Brazils public universities are excellent in strain to the countrys under-resourced primary and secondary schools (Fraga & Bowler, eds. , 2008). Accordingly, Four Seasons should need partnering with local universities to provide internships, job opportunities , or management training programs. Apart from managers, Brazils pitiable education standards may not adversely coin Four Seasons because the company severely emphasizes personality, rather than work experience, in conjureing and selection.Instead, Four Seasons relies on its comprehensive training program to provide the skills needed to perform postu new-made tasks and meet the companys content standards. 3 GENDER ISSUES Common among some(prenominal) Latin American countries is the notion of machismo, the flavor that males are superior to females (Doing patronage in Brazil, 2007). Machismo is perpetuated through society with the lay claimment of handed-down roles to men and women. charm this absorb has belatedly been challenged payable to the influx of Brazilian women into both high education and the workforce (Doing assembly line in Brazil, 2007), managers should be aware that it exists.Furthermore, umpteen customers of Four Seasons pull up s administers be fro m unlike countries where the same gender norms are not present. 4 NORMATIVE BUSINESS PRACTICES Recognizing that normative business practices vary across borders provide be pivotal in deliver the goods in the Brazilian market, as Brazilian local businesses comprise one of Four Seasons target markets. In addition, familiarity with the business culture can yarn-dye the outcome with intrinsic local suppliers. Foreign managers can earn the respect of local associates and illustrate the splendor of their relationship by engaging in the local business customs.Upon meeting an associate for the first time, men should shake custody accompanied by a pat on the shoulder or offset and women should give a kiss on each cheek (Doing business organization in Brazil, 2007). While Brazilians are very unaffixed and prefer to be addressed by their first name, some sort of entitle such as Doctor or Professor comm nevertheless accustoms it (Brazil firstborn Name or Title? , 2008). Brazilian s tend to be extremely extroverted and chummy and close physical contact while conversing is interpreted normal (Brazil Conversation, 2008) also, be prepared for personal questions.Gifts are not requirement at a first meeting (Brazil Gift Giving, 2010). Since the majority of employees will be Brazilian nationals, normative business practices affect the Four Seasons internal operations in addition to impertinent relationships. collect to the countrys collectivist temperament, Brazilians do not work at private desks, but instead, destiny a large space with several(prenominal) coworkers (Doing telephone circuit in Brazil, 2007). If the Four Seasons structures the work environment consortly, managers moldiness realize that divided up workspace results in a constant integrate of personal and work-related conversations and plan deadlines accordingly.Besides workspace, Brazils collectivist culture also impacts break schedule. Brazilians usually take their lunch breaks simultaneo usly (Doing Business in Brazil, 2007). If the Four Seasons agrees to this practice, scheduling will need to account for huge rupture changes. A Canadian business manager will be horrified if oblivious(predicate) of the routine aspects of a business meeting. Meetings do not begin on time a meeting normally begins xx to thirty minutes early(prenominal) the concur upon time. Once a meeting commences, the setting is very informal.A large arrogate of time at the onset is sacred to personal conversations. Throughout the meeting, it is not peculiar for attendees to take phone calls or leave the room. (Doing Business in Brazil, 2007) Hence, meetings do not serve as an efficient passage to establish an immediate outcome. Negotiations require time, as Brazilian managers prefer to discuss agreements or disputes among themselves privately this stems from the collectivist and feminine nature of the culture (Gillespie, Jeannet, & Hennessey, 2007).These differences can be cut backed with the ease of a local representative, however, each non-Brazilian manager essential acknowledge the lengthy time required to close a deal in order to provide practical schedule projections and deadlines. 2 POLITICAL ENVIRONMENT 1 POLTICAL SYSTEM Brazil instituted a federal republic system of regimen in 1985 following the end of army rule. The structure grants a substantial power to the elected president who holds office for four years with the opportunity for one surplus term if reelected.The president curbs the right to elect his/her cabinet, while the people elect members of Congress. Congress represents Brazils cardinal states and touch on federal district of capital of Brazil through two groups an 81-seat Senate and a 513-member house of Duties. Within Congress, majority power constantly transitions as representatives switch political parties often. (Background detect Brazil, 2010) 2 POLTICAL SITUATION Currently, Luiz Inacio da sylva is nearing the end of his second t erm of presidency.The coming(prenominal) election is scheduled for October 3, 2010 for a new president. President Luiz Inacio da sylva is employ his usuality among Brazilian citizens to support candidate Dilma Rousseff. Rousseffs main opponent, Jose Serra, currently holds an early poll advantage. disregardless of the winner of the October election, the Four Seasons will not be significantly affected as both candidates are expect to continue economic reform and the privatization of industries. (The frugal intelligence operation building block Group, 2010) 3 DOING BUSINESS IN RANKINGS Canada Brazil Rank Doing Business 2010 Doing Business 2010 Ease of Doing Business 8 129 commencement a Business 2 126 relations with Construction Permits 29 113 Employing Workers 17 138 Registering situation 35 120 Getting credit rating 30 87 Protecting Investors 5 73 Paying Taxes 28 one hundred fifty Trading Across Borders 38 100 Enforcing Contracts 58 100 Closing a Busines s 4 131 (The World banking concern Group, 2010) While conducting business in its hearthstone country is some(prenominal) easier than it is in Brazil, Four Seasons prevails in more than thirty-five countries, two of which, India and Syria, rank below Brazil in Ease of Doing Business (The World lodge Group, 2010). Seeing as the Four Seasons is a successful transnational enterprise with profound pockets, the struggle to receive credit in Brazil does present a hefty hurdle for the company.To avoid difficulties related to trading across borders, Four Seasons should obtain necessary tangible components of its operations from local suppliers. In addition, local harvest-homes will facilitate a good relationship with the local environment as well as provide a more authentic experience for guests. Areas that would be of trouble to Four Seasons include enforcing contracts, dealing with construction permits and translateing lieu boneheaded down Brazil. Fortunately, because the com pany specializes solely in management, much of the responsibilities associated to troublesome aspects will be shifted to their partner. A local Brazilian partner would be optimal since strong lucreing and contacts can divine service alleviate the burdens related to obtaining contracts and permits.Although Brazil is characterized as a new growth market, the World Bank Groups Doing Business Rankings demonstrate Brazils institutional boosterlessnesses that are more align with a developing market. For instance, employing workers is extremely difficult deep down Brazil compared to the rest of the world. A pretermit of transaction facilitators, such as executive headhunters, makes it extremely burdensome to locate and recruit employees that possess the necessary skills to be successful at Four Seasons. This absence in particular poses a challenge to Four Seasons because its sustainable competitive advantage of superior customer service is facilitated through its employees. Although not as difficult as employing workers, enforcing contracts presents a significant brat to businesses direct within Brazil. repayable to a inadequacy of adjudicators, firms will take in it arduous to verify payment or reli competency of contractual partners. This problem is throw out exacerbated by the nonexistence of credibility enhancers and informational analyzers that abet with partner selection. 4 POLITICAL essay According to The Coface Group, Brazil received an A4 in both Country Rating run a take chances and Business Climate Risk (2010). An A4 rating indicates an unstable political and economic environment (The Coface Group, 2010). Volatile conditions pose an tremendous threat to Four Seasons due to the amount of draw a bead on investment needed to offer its service. contrary a product offering, the Four Seasons does not down the ability to immediately exit, or temporarily leave, the market.In an effort to curtail the set up of drastic changes, Four Seasons shou ld create a managerial position solely dedicated to environmental scanning. This person should be aware of the significant changes and how they will affect company forecasts. An unstable environment can greatly deter customers from visiting the Four Seasons, particularly the primary target ingredient of brand loyal guests. If a brand loyal guest is kindle in visiting Latin America, they set out the excerption of staying in a Four Seasons located in Costa Rica, Mexico, Argentina, or Uruguay if Brazil appears dangerous and/or unsafe. 5 rot Transparency International graded Brazil 75 out of 180 countries with a score of 3. 7 out of 10 0 represents high corruption (2009). despite the Four Seasons experience in super corrupt countries such as China, Argentina, Egypt, India, Mexico and Syria (Transparency International, 2009), Four Seasons must adequately prepare for the effects of corruption in Brazil. It should incorporate the knowledge gained from the past by consulting senio r managers mixed in highly corrupt countries to levy contingency plans. However, it is important that the company recognizes differences between countries. For this, Four Seasons should consider using a Brazilian partner. A local partner possesses knowledge of the local community and business environment and can offer an insider positioning on solving obstacles that arise out of corruption.Furthermore, a local partner holds local contacts that may be utilized to turn off corrupt organizations or dealings. 6 unknown RELATIONS Brazil corpse open and friendly toward the majority of countries, in particular its in the south American neighbors. Recently, Brazil has foc apply on expanding relations with its neighbors through intimacys such as the Latin American Integration tie (ALADI), the Union of confederation American Nations (UNASUL), and Mercosur, a customs northern between Argentina, Uruguay, Paraguay, and Brazil, with Chile, Bolivia, Peru, Colombia, and Ecuador as associa te members. (Background none Brazil, 2010) Openness toward unusual nations ensures embargoes, or other forms of impediments, will not disrupt imports.While Four Seasons should earn components from local suppliers to enhance its relationship with the environment, the company does not need to spend time concerned over delivery of its merchandise supplies. For imported aspects, Four Seasons should examine countries that are involved in the Mercosur customs union to take advantage of less high-priced tariffs and/or taskationes. Apart from products, Brazils openness ensures that travelers will not stop burdensome procedures to enter the country or hostility from Brazilian citizens when visiting. 3 ECONOMIC ENVIRONMENT 1 OVERVIEW Due to a shift toward market liberalization, Brazil has more than pictured its carry on flows in the past four years.While portfolio investment has amplifyd, contrasted direct investment inflows hit disposition levels in 2007 and 2008. However, in 20 08, Brazil registered its first current-account deficit in five years as a result of a sudden increase in imports. President Luiz Inacio da Silva has focused on a floating exchange rate, ostentatiousness targeting, and primary fiscal surpluses to enhance macroeconomic policies, and therefore, increase Brazils planetary competitiveness. These factors have lead Brazils economy to shift toward a more service-oriented market. Nevertheless, the agricultural sector and diverse industrial base continue to function as enormous drivers of growth. (Fraga & Bowler, eds. , 2008) 2 CURRENCYThe late real was introduced on July 1, 1994 to stabilize the broader Brazilian economy. When introduced, the real was set equivalent to 1 unidade real de valor, a non-circulating quality which in conclusion set the real equivalent to 1 US dollar. Initially, the real climbed against many another(prenominal) major currencies. Strong capital in-flows supported a strong real through late 1995. By 1996, th e central Bank of Brazil instituted tight controls over the real to bring the coins value down. The currency depreciated slowly through 1998, but the Central Bank relaxed controls in 1999 and the real experienced a sudden devaluation. From 1999 to 2002, the currency remained comparatively volatile vis-a-vis major orld currencies. By mid-2002, the real reached an all-time low against the Canadian dollar, along with many major currencies, including the US dollar. The presidential election in late 2002 brought long needed stability to the Brazilian currency. From late 2002 to October 2008, the real slowly appreciated against the Canadian dollar and other major currencies. When the financial crisis hit in late 2008, the currency bounced from rates not seen since 2001 to around R$2C$1. Since the crisis, the currency has again been slowly appreciating against the Canadian dollar. In recent months, the real has been slightly slighting against the Canadian dollar.Overall, the Brazilian real remains a comparatively stable currency, oddly among Latin American currencies. This will make the Four Seasons, as it repatriates profits to headquarters and pays local suppliers. However, as with any abroad currency in particular those in new growth markets immunity from fluctuation isnt a rule. New regimes can negatively affect currency, as well as Brazils significant current account deficit, significant government consumption on the World Cup and Olympics and efficacy to ostentation. Four Seasons plans on pricing in US dollars, which appeals to many of its target markets and is consistent with Four Seasons across the globe. 3 flashSince 2003, Brazil has been successful in easing ostentation pressures on account of strict monetary policy and an appreciation of the reliable (Fraga & Bowler, eds. , 2008). Yet recently, inflation has rose in recent months owing mainly to the planetary recession as well as increase wages and inertial pressures within the country. Th e Central Bank of Brazil has set a target of 4. 5% for 2010. The economic Intelligence Unit is optimistic, predicting that inflation will fall 4. 8% to 2. 5% between 2010 and 2011. (The Economic Intelligence Unit Group, 2010) Four Seasons must constantly monitor the inflation rate once within Brazil. If the EIU is correct, a 2. 3% change in the inflation rate will have an enormous impact on the operations (The Economic Intelligence Unit Group, 2010).Brazil will need to constantly change their prices in order to keep up with large changes. Fortunately, the majority of price postings occur through the companys website allowing the company to avoid immense costs required to reproduce materials. Higher inflation translates into higher prices not tho for Four Seasons guests, but also for components the hotel buys from local suppliers or imports from other countries. Additionally, Four Seasons may consider using employee contracts that localise for inflation to curb anger associated with discharge of purchasing power. Luckily, the EIU predicts inflation to go down and remain relatively stable in the future at 2. % (The Economic Intelligence Unit Group, 2010), limiting negative consequences line upred by operations. 4 LABOR CODES The Brazilian government requires all companies, foreign and domestic, to provide specific elements to its employees including thirty days of annual leave, an annual tribute equal to one months salary, and severance pay if dismissed without a cause. Additionally, if a firm employs more than three employees, Brazilian nationals must account for two-thirds of the total employees and payroll. Brazil has instituted a system of labor courts to handle workplace disputes involving working conditions, wages, dismissal, etc. (The incision of Commerce, 2009) It would be ill advised to ignore government employment requirements.Not only would the company risk being forced out of the market, Four Seasons would incur a tarnished reputation with in the global arena. When hiring and scheduling future employees, Four Seasons must account for each individuals thirty days of leave the firm must decide whether it will assign vacation time or conduct with employees for specific requests. If two-thirds of payroll must be distributed to Brazilian nationals, Four Seasons should scan the local environment for senior management positions, as these executives tend to comprise a large portion of pay. As Four Seasons offers a service requiring an array of different workers, the company must find a way to ooperate with highly unionized Brazilian workforce currently, over 16,000 unions exist who are very well organized and are not hesitant to use aggressive methods (The segment of Commerce, 2009). A local partner may possess pertinent information to care alleviate any contentions that may arise. 5 INFRASTRUCTURE President Luiz Inacio da Silva announced the Growth Acceleration Plan in 2007, which committed a US $296 million investment in al-Qaeda by the end of 2010. Although the GAP is promising, Brazils infrastructure remains one of the largest obstacles within the economy. Poor quality and many deficiencies remain in roads, ports and airports no passenger trains travel outside the suburbs of major cities and only 12. 5% of the existing roads are paved. (The department of Commerce, 2009)While the 2016 Summer Olympics should increase incentives for private companies to improve infrastructure, Four Seasons must contemplate the effects of a worthless transportation system. It may want to consider sourcing the majority of its tangible components from nearby local suppliers to ensure secure and fast delivery. Furthermore, imports are more likely to be priced higher on account of the inefficiencies within the infrastructure. A foreign direct investment is an option to increase efficiency and satisfaction Four Seasons should investigate options near the hotel in addition to routes travelers predominately use. For example, it could form a strategic partnership with another(prenominal)(prenominal) firm to enhance the roads to and from the airport. 4 LEGAL ENVIRONMENT 1 INTELLECTUAL PROPERTYBrazil is a signatory to various agreementsTrade associate Aspects of clever Property (TRIPS) Agreement, the Bern assemblage on Artistic Property, the Patent Cooperation Treaty, and the genus Paris Convention on Protection of Intellectual Propertycommitting the government to stringent breastplate of intellectual property rights. The decision to take part in international contracts was the countrys first realistic step toward putting an end to issues such as copyright infringement, however, piracy and counterfeiting remains a problem within Brazil. (The discussion section of Commerce, 2009) While Four Seasons does not possess a substantial amount of intellectual property that would threaten its existence, it does need to consider violations when procuring components for its hotel, particularly authentic furniture, decorations and artwork.It would be wise for Four Seasons to implement a system used to differentiate genuine pieces from others. 2 ENTRY MODE Four Seasons, or any foreign or domestic private entity, may establish, own, and dispose of business entities allowing the company to chose any entry mode grounded solely in its own decision do (The Department of Commerce, 2009). Although a lack of government regulation offers the firm freedom of choice, it would be extremely useful to use a local representative to own the hotel building itself. As previously mentioned, Brazil is a highly collectivist culture that requires an extended amount of time dedicated to relationship building to be successful in procuring supplies, building contracts, permits, etc.A local partner possesses established networks that can be utilized to sidestep regulations and corruption in addition to knowledge specific to the Brazilian environment. 3 IMPORTS Brazil imports are character to three separa te taxes Import traffic (II), Federal Industrialized Product tax (IPI) and the State Merchandise and Service Circulation tax (ICMS) (The Department of Commerce, 2009). Because both the IPI and ICMS are value-added taxes (The Department of Commerce, 2009), imports end up becoming very costly for customers. Unless a specific tangible component is critical to the success of Four Seasons, it would be in the countrys best interest to purchase supplies from local businesses to avoid high prices pushed down to the customer because of high taxes.High import taxes mated with Brazils poor infrastructure will threaten the safe and efficient obtainment of products. If the Four Seasons depends on authentic aspects from headquarters, or another Four Seasons location, it should be aware that the foreign entity must register with Foreign Trade Secretariat (SECEX) in order to conduct trade with Brazil. 4 TRADE AGREEMENTS Brazil has established two-sided investment agreements with numerous countr ies including Belgium, Luxembourg, Chile, Cuba, Denmark, Finland, France, Germany, Italy, Republic of Korea, Netherlands, Portugal, Switzerland, united Kingdom and Venezuela however, the Brazilian Congress has not as yet ratified any of these. (The Department of Commerce, 2009)Brazil has signed Mercosur, a regional trade agreement, between itself and Argentina, Uruguay, Paraguay, and Brazil, with Chile, Bolivia, Peru, Colombia, and Ecuador as associate members (The Department of Commerce, 2009). If imports are required, Brazil should heavily consider sourcing from countries involved to significantly decrease costs associated with imports. Furthermore, Brazil maintains a double taxation with Canada, making imports from its headquarters extremely expensive. 5 LABELING Labeling requirements should not present Four Seasons with a notable barrier. Firstly, the primary focus of the company is services, not products. Besides the gift shop and food menus, Brazil will rarely encounter bar riers in labeling. Secondly, The Brazilian Customer Protection Code does not call for unconventional or outlandish.Specifically, labeling must provide the consumer with precise and easily light information about the products quality, mensuration, composition, price, guarantee, shelf life, origin, and risks to the consumers health and preventive (The Department of Commerce, 2009). The only hurdle Four Seasons may encounter relating to labeling is a Lusitanian translation and metric equivalent to the requirements listed above. 6 PROMOTION Direct situation is emerge in Brazil as a very useful method for scope Brazilian consumers citizens receive an average of 9. 3 pieces of direct mail every month and 74% of Brazilians prefer direct mail to create awareness of a new product or service (The Department of Commerce, 2009). Four Seasons is encouraged to use direct mail to target local businesses and community members within its promotional aspect of its marketing campaign.It should oddly use Veja, the most popular magazine in furl with an average of one million copies dispersed a week, and Folha de Sao Paulo, the largest newspaper with an average of 317,000 copies distributed Monday through Friday and 400,00 on Sunday (The Department of Commerce, 2009). Media in Brail is still heavily controlled through the public sector foreign ownership is special to 49% (The Department of Commerce, 2009). This should not affect Four Seasons greatly since the company avoids advertisements in mass media outlets. Also, the majority of Four Seasons target segments does not reside in Brazil. 2 COMPETITIVE ANALYSIS Many transnationals, especially Four Seasons traditional competitors, have yet to enter the Brazilian market or only have a low-spirited presence in Rio de Janeiro.Additionally, there are only a small number of sumptuosity local brands in Rio de Janeiro that are capable of competing with Four Seasons. In many regards, Brazil remains a relatively untapped market, t hough a number of international brands have recently begun eyeing the market, including Hilton. With the increase opportunity in Brazil, now more than ever may be a great time to enter the youngish market, armed with the experience learned through other brands ventures. 1 MAJOR COMPETITORS 1 PESTANA HOTELS AND RESORTS (PORTUGAL) Pestana is Portugals largest tourism and leisure group, operating 41 hotels across 3 continents in countries with former compound ties to Portugal (Pestana, n. d. ).Pestana entered Brazil via Rio de Janeiro in 1999 with a local partner, Renato Albuquerque Group (Grupo da Madeira investe US$25 milhoes no Brasil, 1999). quite than building a new establishment, the company acquired the Carlton Rio Atlantica hotel, modernized the establishment, and added a new business center to deplume business travelers (Grupo Pestana lanca cartao no Rio, 2001). Since 1999, Pestana has been heavily investing in Brazil and considers Rio de Janeiro a focal point for the compa ny (Grupo Pestana lanca cartao no Rio, 2001). By 2001, Brazil accounted for 20% of Pestanas hotel business (Grupo Pestana reforca atuacao no Pais, 2001). By 2004, the company had opened 6 hotels across Brazil with the stated goal of opening 10 more hotels within the next 10 years.The companys significant investment in the market $ cx million by 2004 has brought increased genuineness and credibility to the Brazilian market as an opportunity for sumptuosity and business travel, according to Francisco Rabelo, financing director for Bank of northeasterly Brazil. This significant growth has been fueled by the companys success in the country the company has achieved an average annual return of 31% on its investments and the country is already its best performing dominion in Pestanas portfolio. The Director of the finance and Investment Promotion Department of Brazils tourism Ministry said the group was one of the largest hotel groups in Brazil by 2005 the company was expected to have 400,000 room-nights in the country, more than any other hotel chain (Renata, 2006).One of Pestanas most palpable assets is its intimate sagaciousness of Lusitanian culture, being a Lusitanian company. Brazils cultural and colonial ties to Portugal make the Brazilian market a particularly attractive market for Pestana, and as the companys exceptional returns have demonstrate, Pestana is taking full advantage of its country-of-origin effects. With the companys high knowledge of local culture and Brazils cultural similarity to Portugal, the company is able to keep the services within Brazil appear as very situate without adapting its standardized services much. This is a trend Pestana has demonstrated in the past, as it only enters markets with cultural ties to its home market (Pestana, n. d. ).In this sense, Pestana can maintain a relatively standardized offering while appearing to be adapting to the local context. This intimate knowledge of Brazilian culture will be rewarding, as other transnationals dont have access to or credibility with local culture. another(prenominal) ridiculous advantage that Pestana has is its ability to build pousadas within Brazil. Pousadas are dress shop, lavishness hotels that encapsulate Portuguese culture. Until 2003, the Portuguese government was responsible for developing and managing the hotels. Pestana bought the sole rights to building pousadas from the Portuguese government in 2003, though the government maintains highly involved in overseeing each new pousada to ensure it meets minimal standards (Pousadas de Portugal, n. d. ).Pestana has expressed interest in manner of speaking these unique products to Brazil and completed the construction of one in 1999. The company plans on expanding its offerings in the coming years in tandem with its commitment to building 10 hotels in the coming 10 years (Renata, 2006). These hotels autoloading(prenominal)ally connect with locals and foreigners abroad who want an authentic e xperience in Brazil. No other hotel chain can emulate these boutique hotels even localizing a hotel as much as possible wint replicate a pousada as it wont have the unique stamp by the Portuguese government. more(prenominal)over, pousadas are often located in historical buildings, making them even more of an attractive destination (Pousadas de Portugal, n. d. ).Pousadas have the possibility of attracting travelers interested in an authentic experience without the risk of traveling to an unknown hotel. Travelers can experience howling(a) accommodations and proven service in the local context of pure and authentic Portuguese culture, service and food. In fact, Brazils attend of Tourism has said that pousads will attract a higher class of tourists who are willing to pay additional money for the unique experience (Renata, 2006). another(prenominal) effectualness Pestana has demonstrated is its ability to connect with locals and operate efficiently within the local political and e conomic environment. Across Brazil, Pestana has demonstrated a tendency to enter cities by acquiring local hotels, as it did in Rio de Janeiro and Natal.This ensures that the hotels Pestana operates have a distinctly local wizardry and enable the company to penetrate the market quicker, avoiding lengthy construction times. The company also enters local markets with local partners, though it uses different partners in different cities. This willingness to character ownership gives the company powerful local associate and gives the company legitimacy among locals. These are important stances, as many other multinationals are less successful at navigating Brazils complicated and corrupt government. Moreover, entering a market with a local partner shifts risk and offers the company valuable local knowledge.A possible flunk the group has is its organizational structure. The group maintains an International Division Organization structure. While Pestana only operates in markets base d on the Portuguese culture, countries with similar histories still vary greatly in terms of market power, government regulation and destination type. By clumping all international destinations under one group, the company may fail to fully take advantage of each market or understand each market. The companys lack of resources committed solely to Brazil may enable competitors to build a structure that is more tractile and responsive to trends and changes within the Brazilian market.Further, as the company begins expanding outside Brazil into other South American countries, the company may continue to dilute its attention to Brazil, thereby commentary many of its potential susceptibilitys as much less poignant. A final exam flunk of the company is its intense focus on growth. Between its 10 hotels in 10 years policy in Brazil, and its overarching 30 hotels in 30 years policy, Pestana may begin to focus on quantity above quality. While the companys unique products and intimate kn owledge of Portuguese culture may attract highlife travelers at first, maintaining the high quality and service standards demanded by the business traveler and opulence leisure traveler may to be difficult amidst such an emphasis on growth.Finally, as the number of hotels owned by Pestana surges, the company may saturate the market and devalue the novelty of its brand. The hotels may become less alluring and less of a destination as they become present and commonplace. 2 STARWOOD HOTELS & RESORTS (UNITED STATES) AND GOLDEN TULIP HOSPITALITY (SWITZERLAND) whizwood is one of the worlds largest and most geographically diverse hotel and leisure companies. The company is mainly a hotel management corporation, responsible for highlife brands The Luxury Collection, Regis, W and Le Meridien and other midrange brands Westin, Sheraton and Element ( superstarwood Hotels & Resorts). Until recently, the companys sole exposure to Rio de Janeiro was its three Sheraton hotels, two of which l acked a spa.While the hotels have meeting faculties, the hotels dont appear in trade magazines as specifically targeting the business community. As such, these three hotels are not considered to be in direct competition to the Four Seasons because they do not focus on any of our target markets. On June 12, 2009, asteriskwood acquired luxurious Tulip Hospitality, a global hospitality company with a strong focus on the corporate traveler. Tulip manages three hotel chains, including the upscale Golden Tulip, which focuses on business travelers, and the luxurious lofty Tulip, which focuses on leisure travelers (Golden Tulip Hospitality). Tulip has one property in Rio de Janeiro, the Golden Tulip Ipanema Plaza.The property has a spa and complete business center. The hotels focus on corporate travel finally endorses Starwood as a viable competitor in the Rio de Janeiro market. Tulip is a unique hotel insomuch as it relies on international standards of service, yet has been relatively successful at integrating local flavors into its brand. The company advertises its local touches through its advertising campaign, International standards, local flavors. Tulips worldwide presence also lends it strong appeal and espousal worldwide, especially among the luxury and business traveler. This is, in part, due to its global standards of service that international travelers have come to know and rely on.Tulips ability to incorporate local culture into a standardized brand is a powerful competitive advantage. Maintaining standard levels of service is important to the international traveler, as it assures him/her what to expect when traveling and builds brand equity. However, by maintaining these standards and adding local culture into each property, Tulip finds a pose ground between standardization and adaptation. This is a strategy that enables the company to remain flexible to local demands and local clients, but also cater to international travelers. One strength of th e Starwoods acquisition of Tulip is Tulips acceptance among the international elect.Until the acquisition, Starwoods two luxury brands St. Regis and the Luxury Collection did not have properties in Brazil. This acquisition gives Starwood immediate brainstorm into Rio with a familiar and proven portfolio of properties. With Starwoods and Tulips combined international experience, the group can effectively begin targeting the elect(ip) traveler more vigorously. Co-branding opportunities and brand indication opportunities also exist, as both hotel companies have more luxurious brands they could deploy in Rio de Janeiro if the Golden Tulip proves successful. Moreover, Starwoods large reserve of loyal guests gives the combined company an automatic target market from which to draw.A final strength of the merger is Starwoods and Tulips global footprint and established luxury brands lend it credence among the international elite. The companys brand equity is an important strategic asse t that can be used to connect with world travelers and attract them to their properties in Brazil. Starwoods skill at managing a portfolio of multiple brands is important, as Tulip becomes another brand that Starwood can leverage, advertise and use to attract travelers. One potential failing of the merger is the possibility that incongruous corporate cultures may obturate the companies ability to synergize strengths and build a comprehensive network.As with any merger, it takes time to fully integrate a new company into an existing company, and Starwood must be able to keep Tulips corporate culture in tact if it hopes to reap the benefits of the companys strengths. If Starwood tries to change or adapt Tulip too much, it will lose Tulips connections with the business traveler and the companys unique ability to combine international standards with local adaptation. Starwood must focus on maintaining Tulips brand identity and equity, while simultaneously confluence the company into its portfolio to fully realize a competitive advantage. Another possible impuissance is Starwoods express mail exposure to the Brazilian market, especially Rio de Janeiros luxury market.While Tulip has been in Brazil for some time, and both companies have experience in the luxury segment, Starwood is less familiar with the luxury hotel segment in Brazil than some of its existing competitors. This lack of experience could prove to be harmful if Starwood is not careful in executing operations, especially since the Brazilian market has proven to be difficult for international brands to tap. Starwood and Tulip both lack a positive country-of-origin effect, as the Brazilian market has proven to be fiercely loyal to local and Portuguese brands. Assuming that the namesake of its hotels will make the company successful could prove to be an unsuccessful route for the company to head. MARRIOTT international (UNITED STATES) Marriott is one of the worlds largest lodging companies with over 3, 000 hotels spread across 67 countries. Marriott primarily franchises under an array of brands, including the luxurious J. W. Marriott and Ritz Carlton and other full-service and other mid-tier hotels (Marriott). Marriott entered Rio de Janeiro in 2001, think its efforts on attracting luxury business travelers to answer to the countrys bourgeoning market (Hotels learn into Brazil). The opening of the J. W. Marriott in 2001 tag the citys first new five-star resort in over 12 years (A new Rio de Janeiro Marriott Hotel, 2001). The J. W.Marriott is one of Brazils two multinational hotels on Travel + blanks Worlds lift out Hotels 2010 list, a comprehensive listing on the worlds 500 best hotels (T+L 500 Worlds Best Hotels 2010, n. d. ). The hotel offers a full-service spa, executive floor, complete business facilities and cattle farm halls and on-site restaurants. Before opening the hotel, Marriott sell off its involvement in the hotel with the help of a local consulting firm. Howe ver, the acquisition of land along with the initial costs and goal were all sponsored by Marriott without the specific help of locals. Marriott retained control over management of the hotel (Rede Marriott e Odebrecht colocam hotel carioca a venda).Marriott is the largest and most recognized multinational brand currently in Brazil. The J. W. Marriott brand, in particular, has resonance with our target markets, especially luxury travelers, as demonstrated by its placement on the Travel + blank rankings. This is a powerful asset, as the cabal of brand equity, name recognition and recognized quality may connect with luxury world travelers. Moreover, the companys worldwide presence and name recognition may also resonate with business travelers who are already familiar with the brand and trust the hotel to be a quality establishment. A major weakness the hotel faces also stems from its name. standardised other multinational chains discussed, Brazilians prefer local hotels.The negative country-of-origin effects have hurt Marriott, as US flags are not necessarily familiar locally since Brazilians exposure to these brands is significantly more limited and Brazilians tend to be attracted to local brands. This is a weakness the company faces when targeting local visitors and businesses, another target market that the Four Seasons is hoping to target. Another weakness Marriott faces is its lack of local partnerships. When entering the market, Marriott did not search for a partner. This is in stark contrast to other successful chains, especially since Marriott lacks experience in the Brazilian market overall. According to the CEO In order to move forward, we will need to find common ground with the Brazilian business model and probably take some equity positions in some of the developments to gain market knowledge and brand acknowledgement.A second option is to enter with our existing relationships through local partners to implement our manage-franchise business model (ONeill & Chao, 2008). Coming from a country with significantly different normative business practices and limited exposure to Brazilian culture despite its significant international presence has proven a difficult obstacle for Marriott. This is an important weakness to consider for all multinational companies, especially those unfamiliar with the Brazilian marketplace. A final weakness Marriott faces is its pricing structure, which is higher than many of its competitors. While the hotel has higher rankings than other multinationals, if the benefits of the brand are not properly communicated, the hotel may seem overpriced.Moreover, if the hotel does not distinguish itself as luxurious, the company may face problems persuading international travelers to choose an American hotel chain over a more localized chain. 4 COPACABANA palace BY ORIENT-EXPRESS HOTELS (BERMUDA) The Copacabana Palace is a historic, luxury hotel built in 1923. It is considered by many around the world as the place to stay in Rio (Doyle, 2009). The Copacabana Palace is one of three hotels on Travel + Leisures Worlds Best Hotels 2010 list located in Brazil (T+L 500 Worlds Best Hotels 2010, n. d. ). Additionally, the hotel is a member of the 5 Star Alliance, an online travel agency that partners with the worlds most luxurious hotels.Owned by the Guinle family of Rio de Janiero until 1989, the hotel is now owned by Orient-Express (Five Star Alliance, n. d. ). Orient-Express purchases individual luxury hotels across the globe. The company does not advertise itself as a chain, rather positioning each property individually. Properties are managed locally every hotelhas its own name and personality (Orient-Express, n. d. ). Following its purchase, Orient-Express renovated the hotel, render the fifth floor as an executive business center to focus on business travelers. The hotel includes meeting facilities and banquet facilities, all aimed at business travelers needs (Five Star Alliance, n. d. ).The hotel also focuses significantly on elite travelers, as its reputation for service and quality attract politicians, royalty and actors. The hotel has a complete spa and two restaurants, neither of which serves Brazilian cuisine (Five Star Alliance, n. d. ). An important advantage the Copacabana Palace has is its legacy and long-term association with Brazil. From its beginnings, the company has been intertwined into local culture. The owners were local and today, Orient-Express continues to manage the hotel as an independent property. Many view the hotel as the nations superior local option, and foreigners who want an authentic experience may opt to stay at the Copacabana Palace over other multinational chains.The hotels brand equity is particularly strong, as it is a clear favorite(a) among elite travelers. The companys increased focus on business travelers further expands the hotels brand equity and product scope. Another strength the Copacabana Palace is its long history i n Rio de Janeiro. The companys experiences in Rio de Janeiro give it a level of knowledge foreign multinationals cant match. Moreover, the companys success in Rio de Janeiro reflects its ability to work within the countrys legal and political structure. As investment increases in Rio de Janeiro and new multinational chains enter the market, Copacabanas deep understanding of local cultures and the regulatory environment will be exponentially more valuable.While the company is known to Brazilians and the well-traveled elite, a lack of a true multinational brand name may stymie some elite travelers. Not only does the company lack a network of brand loyal patrons, the lack of an internationally recognized brand name may make some travelers hesitant. Additionally, the hotels high price may make other, more familiar options more appealing to travelers, who are sure of the level of quality to expect. 5 FASANO HOTELS (BRAZIL) Fasano is one of the few remaining local competitors yet to be ac quired. The company was established in 1982 as a maiden restaurant the company remains recognized for its culinary achievements.The restaurant pioneered the gastronomic front man in Brazil and continues to uphold its elegant blend of contemporary and traditional Brazilian cuisine. In 2003, Fasano opened its first hotel in Sao Paulo. In the same year, Fasano became a member of the Leading Small Hotels of the World (Five-Star Alliance) and was ranked as one of the worlds 50 best hotels in Travel + Leisure (Fasano, 2010). Fasano opened a hotel in Rio de Janeiro in 2007 amid great hype and reviews, eclipsing the legendary Copacabana Palace as the top play den for Brazils plenteous and famous (Beehner). From its foundation to the finishing touches, Fasano is a local competitor. This is a significant strength the hotel has, as its numerous restaurants all share the spirit of Fasanos famed culinary expertness.The hotel is designed in Bossa Nova-chic style and Brazilian touches complime nt every aspect of the hotel. More than any competitor, Fasano remains a localized and focused hotelier, and has limited experience outside the growing Brazilian market. Fasano is a travelers only real option, when he/she wants to stay at a local, luxury resort. Every other luxury boutique hotel has been acquired or is at a different tier of service than Four Seasons. Another strength Fasano has is its long-term, strategic partnership with real-estate developer JHSF. This has assumption Fasano access to the Brazilian market and enabled the company to take less risky positions in its hotels as JHSF has a 50. 1% stake in the hotel.This also frees up capital for other ventures, as the company is currently building additional properties in Brazil and Uruguay. A possible weakness of Fasano is its lack of experience managing hotels and meeting the expectations of guests, especially foreigners. As Brazils most expensive hotel, the elite guests who frequent Fasano have fabulously high exp ectations. While multinationals have experiences with such clientele, Fasano does not have the same expertise in dealing with this segment and may be overextending its existing resources in an set about to compete with world-class contenders. Indeed, excitement over the hotel has faded since its opening in 2007 and the company continues to charge a significant premium over every other Brazilian hotel.Another weakness is the companys