Foreign Market Entry Strategy – Four Seasons in Brazil

pic pic quadruple placates Hotels and Resorts St accountgic Marketing cast for Entry into Rio de Janeiro, brazil-nut tree pic EXECUTIVE SUMMARY quartette Seasons Hotels and Resort is the mans premier sumptuosity hotel circumspection society. It is currently operating 83 hotels in 35 countries and has built an unriv al unmatchable(prenominal) last(predicate)ed reputation for reliability, trust and confederation with its guests ( quadruplet-spot Seasons, 2010). As the hotel mogul prepargons to grave brazil nut, this paper nar range in detail the groceryplaceplace train plan quaternity Seasons testament implement in the topical anesthetic geopolitical surround. brazil-nut trees show political, legal, social and sparing state draws the give awaycome that acquiring a topical anesthetic lavishness hotelier maculation utilizing its melodic phrase resources like a supply, is the best mode of entry for cardinal Seasons. Fasanos grandiose topical anaesthet ic soil recognition as a beginning(a) hotelier and partnership with brazil-nut treeian satisfyingistic- country developer, JHSF, inducts it an prototype stopdidate for quadruplet Seasons grocery store entry strategy. Exceptional personalized customer overhaul, an integral part of quatern Seasons instigator image and strategy, is similar and solelyow be reign overly transferred when accounting entry Rio de Janeiro.Acquiring Fasanos hotel in Rio de Janeiro, while simultaneously re cooking wholly of its alive staff members completelyow accomplish four-spot Seasons chief(prenominal) objectives when come in brazil nut which include 1. Providing a standardized work quaternion Seasons nates mart has come to receive and yield, while showcasing an authentic brazil-nut treeian know for its guests. 2. Establishing a genuine linkion with the topical anaesthetic community and to a lower placestanding brazil nutian gloss to turn back a sustainable wrinkle rel ationship for rising expansion. 3. Utilizing the close ffective and efficient market strategy to expedite four Seasons juggle into brazil. To guarantee a happy entry into this modernistic growth market, cardinal Integrated Communications footrace strategies will be put into place to reach out to the topical anesthetic community and worldwide consumer base. TABLE OF circumscribe I. EXECUTIVE SUMMARY1 II. TABLE OF CONTENTS2 III. COMPANY AND armed helping OVERVIEW3 A. FOUR SEASONS HISTORY3 B. modern DEVELOPMENTS3 IV. food market ATTRACTIVENESS ASSESSMENT5 A. milieu OVERVIEW5 1. CULTURAL surround5 2. POLITICAL ENVIRONMENT8 3.ECONOMIC ENVIRONMENT10 4. LEGAL ENVIRONMENT12 B. matched abstract14 1. MAJOR COMPETITORS14 2. SWOT ANALYSIS FOR FOUR SEASONS21 C. POTENTIAL TARGET securities industry ASSESSMENT22 1. FOUR SEASONS GUEST DEMOGRAPHICS22 2. TARGET SEGMENTS23 V. mart ENTRY STRATEGY25 VI. MARKETING flick PLAN28 A. BRAND STRATEGY28 B. PRODUCT/SERVICE29 C. PRICE34 D. PL ACE35 E. ADVERTISING AND OTHER PROMOTION35 1. Integrated Communications Campaign for brazil-nut treeians35 2. Integrated Communicates Campaign for International Travelers37 3. FIFA earthly c erstwhilern Cup 2014 & Summer Olympic Games 201640VII. CONCLUSION & RECOMMENDED RESEARCH40 A. SECONDARY RESEARCH41 B. PRIMARY RESEARCH41 1. SURVEYS41 2. FOCUS GROUP42 3. IN-DEPTH INTERVIEWS43 4. OBSERVATION STUDIES43 VIII. REFERENCES44 COMPANY AND SERVICE OVERVIEW 1 FOUR SEASONS HISTORY Isadore nippy, founder of The quatern Seasons Hotels and Resorts, capable his mai hideout hotel in Toronto, Canada in 1961. A modest hotel with 125 affordable rooms, The quaternary Seasons Motor Hotel marked the beginning of a crude kind of hotel in which any customer would be treated as a particular(a) guest.Within ten years, spirit levelce hotels had been opened in Canada, leading to the interruption of the bon tons number 1 hotel oversea in London, England in 1970. oer sentence, four-spot S easons made four strategic ends that formed the pillars of the smart set. The first pillar, quality, was chosen during the initial expansion abroad in the 1970s, to continuously fulfil guest expectations from one hotel to the next. quadruple Seasons as a pock would represent particular(a) quality with a concentrate on on creation the best hotel in each location. The consequence strategic decision was to conformation quaternion Seasons combative favor in serve well. 4 Seasons was accepted for its spiffing service with the col of its first nocked U. S. hotel in Washington, DC in 1979. During the 1980s, Four Seasons continued to expand and introduce flagship hotels by dint ofout the US. The brand suck up began to develop and a distinct brand image was bring to passd. The third pillar, closed declareing, would shoo-in a square occasion in the growth of a weapons-grade brand name. The corporate culture became based on the princely Rule, which Mr. Sharp defi nes as to deal with separatespartners, customers, coworkers, every(prenominal)oneas we would want them to deal with us (Martin, 2008).In 1985, Four Seasons added branded private residences to their hotels and began to transition from a hotel owner to wholly a hotel forethought comp whatever. With the variety, the fourth pillar evolved to grow as a fill outment club and build a brand name synonymic with quality (Four Seasons Hotels and Resorts- About Us Four Seasons History, 2010). Since, Four Seasons has created a brand name worth very a lot to a crackinger extent than its real estate by convolutioning the best service to sumptuousness travelers nearly the world.Four Seasons has frameatic in ally innovated the work offered at its hotels over the years, becoming the first to offer shampoo in the shower, 24-hour room service, bathrobes, cleaning and pressing serve, a dickens-line think in each guest room, a well-lit desk, a full-service spa and 24-hour secretarial services (Martin, 2008). In 1986, the partnership went public and was listed on the Toronto Stock Exchange. A substantial brand name allowed the Four Seasons to engage in a series of in(predicate) hotel openings crosswise the world in the 1990s and into the new millennium.The partnership has gradually expanded its portfolio of resorts to include 83 hotels and resorts in 35 countries and continues to grow in both size and recognition today. Every hotel, from capital of Egypt to Chiang Mai to Milan, demonstrates the four pillars that Mr. Sharp has built the Four Seasons brand upon. 2 RECENT DEVELOPMENTS Headquartered in Toronto, Canada, Four Seasons Hotel and Resorts became the first large hotel company to manage hotels through real estate owners and developers. In 2007, Four Seasons Hotels returned to private ownership, with Bill generate and Saudi Prince Alwaleed Bin Talal each owning 47. % of the company, and Mr. Sharp owning the re maining 5% (Segal, 2009). The bribe was based on the decision to expand more aggressively, limitedally into regions non conducive to public companies (OBrien, 2008). With operations in 35 countries, it has been exceedingly successful abroad and will continue to expand into new markets in the in store(predicate) the Chinese and Indian markets argon predicted to play a vital role in the future of the company (Four Seasons CEO Sees Luxury Trajectory, 2009).As a hotel management company, Four Seasons has complete control over all hotel operations, participates in the designing of new hotels, and earns approximately 3% of r stillue from hotel owners in do-gooder to collecting fees to cover global sales, marketing, and reservations (OBrien, 2008). The major decision harborrs in the company plate currently atomic number 18 ? Isadore Sharp Founder, chairman, and CEO ? Kathleen Taylor president and COO ? Jim FitzGibbon chairman Worldwide Hotel Operations ? Nick Mutton executive director Vice electric chair Human Resou rces and Administration ?Scott Woroch Executive Vice chairperson Worldwide Development ? John Davison CFO and Executive Vice professorship Residential ? Antoine Corinthios President Europe/Middle East/Africa ? Susan Helstab Exective Vice President Marketing (Four Seasons Hotels and Resorts- About Us Corporate Bios, 2010). Four Seasons is continuously acknowledge as an outstanding company winning awards year after year. Four Seasons has remained on Fortunes coke Best Companies to Work For every year since 1998, for a total of twelve consecutive years (Four Seasons Hotels and Resorts- About Us Four Seasons History, 2010).Twenty-two of the Four Seasons properties fetch besides been recognized for excellence in the hospitality industry with the AAA quintuplet baseball diamond award in 2010 (2010 AAA/CAA Five Diamond Lodgings). This is a very prestigious award, presented single to 0. 27% of the 60,000 Diamond Rated lodgings and restaurants throughout the united invokes, Canada , Mexico, and the Caribbean, truly setting Four Seasons Hotels apart from its competitors (Five Diamond Award Winning Hotels and Restaurants, 2010).The thirtieth anniversary issue of the Robb Report,published in 2006, included the Four Seasons on its list of the most exclusive brands of all condemnation alongside other luxury brands such(prenominal) as Rolls Royce, Tiffanys and Louis Vuitton (Four Seasons Hotels and Resorts- About Us Four Seasons History, 2010). CondeNast Traveler similarly consistently recognizes the Four Seasons as a leader in the hospitality industry. OnCondeNast Travelers Global Top 100 List, eighteen Four Seasons hotels have been included, which is triple the count of the next most-listed hotel train (Martin, 2008).By incorporating the four pillars into its affair strategy, the Four Seasons has developed into one of the most-recognized prestigious brands inwardly the hospitality industry. Through its constant focus on exquisite customer service in all m arkets, Four Seasons creates a brand that is immediately associated with exceeding customer impoverishments and expectations in every location. Mr. Sharp summarized the idea by saying If you dont meet it every time, you dont have a brand (Four Seasons CEO Sees Luxury Trajectory, 2009).The computer architecture of a hotel is irrelevant beca role any competitor can replicate it, until now the employees of the Four Seasons describe the company by constantly delivering the premier service promised to the guests, hence, creating the strong brand image travelers associate with Four Seasons. In addition to providing timely and sophisticated service, employees atomic number 18 trained to personalize the service pitch shot through customer name recognition and offering unique services to match guest pick outences.Training employees to deliver customized service has been a great challenge, because personal service is non nighthing you can dictate as a policy. It comes from the cultur e (OBrien, 2008). Mr. Sharp explains the effect of a strong corporate culture on the guests how you treat your employees is how you expect them to treat the customer (OBrien, 2008). Brand integrity, bring together with the corporate pride instilled in 30,000 employees worldwide, is what allows Four Seasons to charge a subsidy impairment.The company has become legendary for its unmovable standards, despite economic recessions, believe that altering room equipment casualtys will diminish the brand. Four Seasons doglike guests continually pay premium prices because they are confident the shining service that is judge will be delivered. Each Four Seasons Hotel and Resort strives to achieve the ideal balance of alineation to the topical anesthetic surroundings and standardization of the service. Four Seasons Hotels are built after comp research of the market and country to adapt to the topical anaesthetic anaesthetic style and create an authentic reckon for guests.The comp any does non have a uniform style that is common in umpteen competitors such as The Ritz Carlton. speckle the hotel is built to reflect the topical anaesthetic culture, service is standardized across all Four Seasons properties. This is a key gene to the adaptation/standardization balance as service is considered the companys sustainable belligerent benefit. Guests expect to receive the same lavishly-quality service at every Four Seasons hotel, despite being in a different country. Room rates as well spay at different properties, taking into account seasonality, economic factors of the host country, and exchange rates.However, each hotel offers a fairly large price range to reflect the different types of rooms and suites available in the property. 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 Cul tural Dimensions, 2009) Although three main target segments for Four Seasons in brazil nut are non- brazilian nationals, the company must(prenominal) ac intimacy heathen differences to be properly prepared to select, train, and compensate local employees and positivistly interact with local descentes.Local firms are vital to Four Seasons subscriber line model since they have material control over spoken promotion for the hotel. In order to receive customers for conferences, giveing or extra events, a lasting relationship acquires to be built with firms in the local environment. Additionally, it is important to understand cultural dimensions to be successful in acquiring the tangible aspects of the byplay that are locally sourced. According to Hofstede measures, Canada and brazil-nut tree vary drastically on all cultural dimensions excluding masculinity.Compared to Canada, brazil nut has a very high Power Distance index (Geert Hofstede Cultural Dimensions, 2009). As a r esult, the Four Seasons Introductory Training Program (FSITP) whitethorn need to be modified. Currently, all new employees representing different levels of the organization, including housekeepers, department managers, non-paid interns, etc. , are placed into one large group for FSITP. Since local brazil nutians expect a sharp division between subordinates and supervisors (Gillespie, Jeannet, & Hennessey, 2007), go bad training schedules may be instituted to account for differences in responsibilities.This could pose a operose challenge because the training program is very standardized and is one of the components that go out the service competitive advantage. On account of strict boundaries between subordinates and supervisors, lower-level employees are non as comfortable with em antecedentment than those in low power distance cultures (Gillespie, Jeannet, & Hennessey, 2007). The Four Seasons managers may want to consider providing condense and clear job descriptions. If narro w job descriptions are constructed, managers must establish monitoring systems to void bureaucratic inefficiencies. The greatest difference between Canada and brazil-nut tree is on the Individualism straddleing. Compared to Canada, brazil nut is a highly socialist culture. (Geert Hofstede Cultural Dimensions, 2009) This facet creates a significant challenge in transaction with local businesses, whether clients or suppliers. Building and maintaining a relationship demands a substantial amount of time and effort employ to face-to-face clashs. It is non an easy task to form a business contract with Brazilians without creating a relationship.This task is increasingly difficult because Brazil is also a high uncertainty eliminateance 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 established personal and business contacts, Four Seaso ns can conserve a great amount of resources. As it would be almost impossible for a local representative to provide every contact, a significant amount of time needs to be allocated for lengthy negotiations and contact build.Although Brazil and Canada drastically differ in Hofstede cultural dimensions, it is important to recognize Four Seasons as a profitable transnational company. It has successful father conducting its business model across motley geographical areas, including Latin America. darn the Four Seasons should non replicate their strategy entirely, it would be unwise to non utilize prior knowledge gains from countries, such as Uruguay, that are culturally very similar to Brazil. 2 EDUCATIONAL arrangement The average number of years of education for the population landing the detention is fin (Fraga & Bowler, eds. , 2008).Lack of a properly trained custody could negatively impact the internal operations of the Four Seasons. Strangely, Brazils public universitie s are excellent in pedigree to the countrys under-resourced primary and secondary schools (Fraga & Bowler, eds. , 2008). Accordingly, Four Seasons should consider partnering with local universities to provide internships, job opportunities, or management training programs. Apart from managers, Brazils shortsighted education standards may not adversely motivate Four Seasons because the company heavily emphasizes personality, rather than work experience, in recruiting and selection.Instead, Four Seasons relies on its nationwide training program to provide the skills unavoidable to perform claimd tasks and meet the companys core standards. 3 GENDER ISSUES Common among several(prenominal) Latin American countries is the notion of machismo, the belief that males are superior to females (Doing dividing line in Brazil, 2007). Machismo is perpetuated through society with the assignment of traditional roles to men and women. eyepatch this view has recently been challenged due to the influx of Brazilian women into both high education and the workforce (Doing ancestry in Brazil, 2007), managers should be aware that it exists.Furthermore, some(prenominal) customers of Four Seasons will be from foreign countries where the same gender norms are not present. 4 NORMATIVE BUSINESS PRACTICES Recognizing that normative business practices vary across borders will be pivotal in succeeding in the Brazilian market, as Brazilian local businesses comprise one of Four Seasons target markets. In addition, long-familiarity with the business culture can affect the outcome with essential local suppliers. contradictory managers can earn the respect of local associates and illustrate the importance of their relationship by engaging in the local business customs.Upon meeting an associate for the first time, men should shake hands accompanied by a pat on the shoulder or arm and women should give a kiss on each impudence (Doing backing in Brazil, 2007). plot of land Brazilians are very informal and prefer to be addressed by their first name, some sort of entitle such as Doctor or Professor usually accustoms it (Brazil First Name or Title? , 2008). Brazilians execute to be extremely extroverted and friendly and close physical contact while conversing is considered chemical formula (Brazil Conversation, 2008) also, be prepared for personal questions.Gifts are not necessary at a first meeting (Brazil Gift Giving, 2010). Since the mass of employees will be Brazilian nationals, normative business practices affect the Four Seasons internal operations in addition to immaterial relationships. Due to the countrys left-winger nature, Brazilians do not work at private desks, but instead, dispense a large space with several coworkers (Doing telephone line in Brazil, 2007). If the Four Seasons structures the work environment accordingly, managers must realize that shared workspace results in a constant mix of personal and work- tie in conversations and plan de adlines accordingly.Besides workspace, Brazils collectivist culture also impacts break schedule. Brazilians usually carry their lunch breaks simultaneously (Doing Business in Brazil, 2007). If the Four Seasons agrees to this practice, scheduling will need to account for coarse shift changes. A Canadian business manager will be horrified if unaware of the routine aspects of a business meeting. Meetings do not begin on time a meeting normally begins cardinal to thirty minutes past the agreed upon time. Once a meeting commences, the setting is very informal.A large portion of time at the onset is dedicated to personal conversations. Throughout the meeting, it is not unusual for attendees to take phone calls or leave the room. (Doing Business in Brazil, 2007) Hence, meetings do not serve as an efficient avenue to establish an immediate outcome. Negotiations require time, as Brazilian managers prefer to discuss agreements or disputes among themselves privately this stems from the coll ectivist and feminine nature of the culture (Gillespie, Jeannet, & Hennessey, 2007).These differences can be curtailed with the help of a local representative, however, each non-Brazilian manager must acknowledge the lengthy time required to close a deal in order to provide realistic schedule projections and deadlines. 2 POLITICAL ENVIRONMENT 1 POLTICAL brass Brazil instituted a federal republic system of governing body in 1985 following the end of military rule. The structure grants a substantial power to the elected president who holds office for four years with the opportunity for one additional term if reelected.The president reserves the right to elect his/her cabinet, while the people elect members of Congress. Congress represents Brazils twenty-six states and repair federal district of Brasilia through two groups an 81-seat Senate and a 513-member sleeping accommodation of Duties. Within Congress, majority power constantly transitions as representatives switch political pa rties often. (Background bring down Brazil, 2010) 2 POLTICAL SITUATION Currently, Luiz Inacio da sylva is nearing the end of his second term of presidency.The upcoming election is scheduled for October 3, 2010 for a new president. President Luiz Inacio da Silva is using his popularity among Brazilian citizens to support candidate Dilma Rousseff. Rousseffs main opponent, Jose Serra, currently holds an early poll advantage. Regardless of the winner of the October election, the Four Seasons will not be significantly affected as both candidates are judge to continue economic reform and the privatization of industries. (The scotch Intelligence structure block class, 2010) 3 DOING BUSINESS IN RANKINGS Canada Brazil Rank Doing Business 2010 Doing Business 2010 Ease of Doing Business 8 129 brainiacting a Business 2 126 Dealing with Construction Permits 29 113 Employing Workers 17 138 Registering Property 35 great hundred Getting Credit 30 87 Protecting Investors 5 73 Paying Taxes 28 150 Trading Across Borders 38 100 Enforcing Contracts 58 100 Closing a Business 4 131 (The World blaspheme Group, 2010) While conducting business in its home country is practically easier than it is in Brazil, Four Seasons operates in more than thirty-five countries, two of which, India and Syria, rank below Brazil in Ease of Doing Business (The World edge Group, 2010). Seeing as the Four Seasons is a successful multinational opening move with deep pockets, the struggle to receive credit in Brazil does present a considerable 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 intersections 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 registering property at heart Brazil. Fortunately, because the company specializes solely in management, much of the responsibilities associated to troublesome aspects will be shifted to their partner. A local Brazilian partner would be pick outimal since strong networking and contacts can help save 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 failinges that are more align with a developing market. For instance, employing workers is extremely difficult in spite of appearance Brazil compared to the rest of the world. A need of transaction facilitators, such as executive headhunters, makes it extremely burdensome to locate and recruit employees that cause the necessary skills to be successful at Four Seasons. This absence curiously poses a challenge to Four Seasons because its sustainable competitive advantage of superior custo mer service is facilitated through its employees. Although not as difficult as employing workers, enforcing contracts presents a significant threat to businesses operating at heart Brazil.Due to a lack of adjudicators, firms will find it arduous to verify payment or reliability of contractual partners. This problem is further exacerbated by the nonexistence of believability enhancers and informational analyzers that assist with partner selection. 4 POLITICAL RISK According to The Coface Group, Brazil received an A4 in both Country Rating Risk and Business Climate Risk (2010). An A4 rating indicates an wobbly political and economic environment (The Coface Group, 2010). Volatile conditions pose an long threat to Four Seasons due to the amount of direct investment needed to offer its service. Unlike a product offering, the Four Seasons does not have the ability to immediately exit, or temporarily leave, the market.In an effort to curtail the effectuate of drastic changes, Four Seas ons should 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, peculiarly the primary target segment of brand loyal guests. If a brand loyal guest is interested in visiting Latin America, they have the option of staying in a Four Seasons located in costa Rica, Mexico, Argentina, or Uruguay if Brazil appears dangerous and/or un effective. 5 CORRUPTION enhancer International stratified Brazil 75 out of 180 countries with a score of 3. 7 out of 10 0 represents high decadency (2009).Despite the Four Seasons experience in highly corrupt countries such as China, Argentina, Egypt, India, Mexico and Syria (Transparency International, 2009), Four Seasons must adequately prepare for the effects of subversive activity in Brazil. It should hold the knowledge gained from the past by consu lting senior managers tough in highly corrupt countries to produce 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 perspective on solving obstacles that arise out of corruption.Furthermore, a local partner holds local contacts that may be utilise to sidestep corrupt organizations or dealings. 6 FOREIGN RELATIONS Brazil remains open and friendly toward the majority of countries, particularly its South American neighbors. Recently, Brazil has focused on expanding relations with its neighbors through associations such as the Latin American Integration Association (ALADI), the Union of South American Nations (UNASUL), and Mercosur, a customs union between Argentina, Uruguay, Paraguay, and Brazil, with Chile, Bolivia, Peru, Colombia, and Ecuador as associate members. (Background Note Brazil, 2010) Openness toward foreign nations ensures embargoes, or other forms of impediments, will not interrupt imports.While Four Seasons should procure components from local suppliers to enhance its relationship with the environment, the company does not need to spend time concerned over pitch of its imported supplies. For imported aspects, Four Seasons should examine countries that are involved in the Mercosur customs union to take advantage of less costly tariffs and/or taxes. Apart from products, Brazils openness ensures that travelers will not watch 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 doubled its treat wind flows in the past four years.While portfolio investment has outgrowthd, foreign direct investment inflows hit remember levels in 2007 and 2008. However, in 2008, Brazil registered i ts 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, lump targeting, and primary fiscal surpluses to enhance macroeconomic policies, and therefore, increase Brazils global competitiveness. These factors have lead Brazils economy to shift toward a more service-oriented market. Nevertheless, the agricultural sphere of influence and diverse industrial base continue to function as enormous drivers of growth. (Fraga & Bowler, eds. , 2008) 2 CURRENCYThe modern real was introduced on July 1, 1994 to stabilize the broader Brazilian economy. When introduced, the real was set like to 1 unidade real de valor, a non-circulating notes which ultimately set the real equivalent to 1 US dollar. Initially, the real climbed against many major currencies. Strong capital in-flows supported a strong real through late 1995. By 1996, the Central Bank of Brazil instituted tight controls over th e real to bring the currencys prise 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 relatively evaporable 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 fiscal 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 depreciating against the Canadian dollar.Overall, the Brazilian real remains a relatively stable currency, especially a mong Latin American currencies. This will benefit the Four Seasons, as it repatriates profits to headquarters and pays local suppliers. However, as with any foreign currency especially those in new growth markets immunity from fluctuation isnt a rule. stark naked regimes can negatively affect currency, as well as Brazils significant current account deficit, significant government expenditure on the World Cup and Olympics and susceptibility to inflation. Four Seasons plans on determine in US dollars, which appeals to many of its target markets and is consistent with Four Seasons across the globe. 3 INFLATIONSince 2003, Brazil has been successful in easing inflation pressures on account of strict monetary policy and an appreciation of the corporeal (Fraga & Bowler, eds. , 2008). Yet recently, inflation has rose in recent months owing in the first place to the global recession as well as increase fight and inertial pressures within the country. The Central Bank of Brazil has se t a target of 4. 5% for 2010. The Economic Intelligence building block 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-scale changes. Fortunately, the majority of price postings occur through the companys website allowing the company to avoid grand costs required to reprint materials. Higher inflation translates into higher prices not single 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 adjust for inflation to check over anger associated with loss of purchasing power. Luckily, the EIU predicts inflation to decrease and remain relatively stable in the future at 2. % (The Economic Intelligence Unit Group, 2010), limiting negative consequences beginred by operations. 4 LABOR CODES The Brazilian government requires all companies, foreign and domestic, to provide ad hoc elements to its employees including thirty eld of yearly leave, an annual bonus equal to one months salary, and rupture 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 within the global arena. When h iring and scheduling future employees, Four Seasons must account for each single(a)s thirty days of leave the firm must decide whether it will assign holiday time or negotiate 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 division of Commerce, 2009). A local partner may possess pertinent information to help 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 infrastructure by the end of 2010. Although the GAP is promising, Brazils infrastructure remains one of the largest obstacles within the economy. Poor quality and numerous deficiencies remain in roads, ports and airports no rider 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 amend infrastructure, Four Seasons must contemplate the effects of a poor tape drive 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 check options near the hotel in addition to routes travelers predominately use. For example, it could form a strategic adhe siveness with other firm to enhance the roads to and from the airport. 4 LEGAL ENVIRONMENT 1 INTELLECTUAL PROPERTYBrazil is a signatory to various agreementsTrade Related Aspects of clever Property (TRIPS) Agreement, the Bern Convention on Artistic Property, the Patent Cooperation Treaty, and the Paris Convention on Protection of Intellectual Propertycommitting the government to stringent protection of capable property rights. The decision to take part in international contracts was the countrys first realistic step toward putting an end to issues such as procure infringement, however, piracy and counterfeiting remains a problem within Brazil. (The Department 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 syste m 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 making (The Department of Commerce, 2009). Although a lack of government jurisprudence 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 extensive 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 subject to three separate taxes Import Duty (II), Federal Industrialized Product tax (IPI) and the State Merch andise 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 expensive 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 paired with Brazils poor infrastructure will threaten the safe and efficient obtainment of products. If the Four Seasons depends on certain aspects from headquarters, or some other 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 bilateral investment agreements with numerous countries including Belgium, Luxembourg, Chile, Cuba, Denmark, Finland, France, Germany, Ital y, res publica of Korea, Netherlands, Portugal, Switzerland, United Kingdom and Venezuela however, the Brazilian Congress has not that formalize 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 barriers in labeling. Secondly, The Brazilian Customer Protection polity does not call for unconventional or outlandish.Specifically, labeling must provide the consumer with accurate and easily readable information about the products quality, metre, composition, price, guarantee, ledge life, origin, and risks to the consumers health and safety (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 mail is emerging in Brazil as a very useful method for reaching 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 encourage to use direct mail to target local businesses and community members within its promotional aspect of its marketing campaign.It should especially use Veja, the most popular magazine in Brail with an average of one million copies discharge 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 heavens foreign ownership is limited 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 multinationals, especially Four Seasons traditional competitors, have yet to enter the Brazilian market or only have a gauzy presence in Rio de Janeiro.Additionally, there are only a sodding(a) number of luxury local brands in Rio de Janeiro that are capable of competing with Four Seasons. In many regards, Brazil remains a relatively untapped market, though a number of international brands have recently begun eyeing the market, including Hilto n. With the increase opportunity in Brazil, now more than ever may be a great time to enter the young 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 vacant group, operating 41 hotels across 3 continents in countries with former colonial 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). Rather than building a new establishment, the company acquired the Carlton Rio Atlantica hotel, modernized the establishment, and added a new business perfume to attract 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 company (Grupo Pestana lanca cartao no Rio, 2001). By 2001, Brazil accounted for 20% of Pestanas hote l 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 $110 million by 2004 has brought increased legitimacy and credibleness to the Brazilian market as an opportunity for luxury and business travel, according to Francisco Rabelo, financing director for Bank of Northeastern 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 territory in Pestanas portfolio. The Director of the Finance and Investment Promotion Department of Brazils Tourism Ministry verbalize 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). iodin of Pes tanas most palpable assets is its intimate sagacity of Portuguese culture, being a Portuguese 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 demonstrated, 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 localized 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 multinationals dont have access to or credibility with local culture. Another unique advant age that Pestana has is its ability to build pousadas within Brazil. Pousadas are boutique, luxury hotels that encapsulate Portuguese culture. Until 2003, the Portuguese government was creditworthy 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 minimum standards (Pousadas de Portugal, n. d. ).Pestana has expressed interest in bringing 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 automatically connect with locals and foreigners abroad who want an authentic experience in Brazil. No other hotel chain can emulate these boutique hotels even localizing a hotel as much as possible wont replicate a pousada as i t wont have the unique stamp by the Portuguese government. Moreover, pousadas are often located in historic 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 wondrous accommodations and proved service in the local context of pure and authentic Portuguese culture, service and food. In fact, Brazils Minister of Tourism has state that pousads will attract a higher class of tourists who are uncoerced to pay additional money for the unique experience (Renata, 2006). Another readiness Pestana has demonstrated is its ability to connect with locals and operate efficiently within the local political and economic 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 hote ls Pestana operates have a distinctly local flair 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 share ownership gives the company sinewy local allies and gives the company legitimacy among locals. These are important volumes, 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 invaluable local knowledge.A possible weakness the group has is its organizational structure. The group maintains an International grade Organization structure. While Pestana only operates in markets based 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 destination s 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 flexible 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 make many of its potential specializations as much less poignant. A concluding weakness 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 knowledge of Portuguese culture may attract luxury travelers at first, maintaining the high quality and service standards demanded by the business traveler and luxury leisure traveler may to be diffi cult amidst such an emphasis on growth.Finally, as the number of hotels owned by Pestana surges, the company may bang up the market and devalue the novelty of its brand. The hotels may become less beguiling and less of a destination as they become ubiquitous and commonplace. 2 STARWOOD HOTELS & RESORTS (UNITED STATES) AND GOLDEN TULIP HOSPITALITY (SWITZERLAND) Starwood is one of the worlds largest and most geographically diverse hotel and leisure companies. The company is primarily a hotel management corporation, creditworthy for luxury brands The Luxury Collection, Regis, W and Le Meridien and other midrange brands Westin, Sheraton and Element (Starwood Hotels & Resorts). Until recently, the companys sole impression to Rio de Janeiro was its three Sheraton hotels, two of which lacked 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 dir ect competition to the Four Seasons because they do not focus on any of our target markets. On June 12, 2009, Starwood acquired Golden 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 deluxe Royal 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 possible 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 st rong appeal and betrothal 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 aright 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 integrity. However, by maintaining these standards and adding local culture into each property, Tulip finds a middle 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 the 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 penetration into Rio with a familiar and turn up portfolio of properties. With Starwoods and Tulips feature international experience, the group can effectively begin targeting the elite traveler more vigorously. Co-branding opportunities and brand university extension 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 acceded 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 asset 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 weakness of the merger is the possibility that ill-matched corporate cultures may stymie 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 merging the company into its portfolio to fully realize a competitive advantage. Another possible weakness is Starwoods limited 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). Marrio tt entered Rio de Janeiro in 2001, focusing its efforts on attracting luxury business travelers to respond to the countrys bourgeoning market (Hotels check into Brazil). The opening of the J. W. Marriott in 2001 marked 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 + Leisures Worlds Best 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 blast, complete business facilities and banquet halls and on-site restaurants. Before opening the hotel, Marriott sold off its stake in the hotel with the help of a local consulting firm. However, the acquisition of land along with the initial costs and design were all sponsored by Marriott without the specific help of locals. Marriott retained control over management of the hotel (Rede Marriott e Odebrecht colocam ho tel 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 + Leisure rankings. This is a powerful asset, as the combination of brand equity, name recognition and recognized quality may connect with luxury world travelers. Moreover, the companys worldwide presence and name recognition may also happen upon 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. identical other multinational chains discussed, Brazilians prefer local hotels.The negative country-of-origin effects have hurt Marriott, as US flags are not unavoidably 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 likely 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 obs tacle 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 brand itself as luxurious, the company may face problems persuading international travelers to choose an American hotel chain over a more localized chain. 4 COPACABANA castle BY ORIENT-EXPRESS HOTELS (BERMUDA) The Copacabana castle 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 membe r 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, outfitting 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 Brazili an 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 preeminent 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 favored 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 in 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 leg al 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 unbent 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 acquired. The company was established in 1982 as a frontmost restaurant the company remains recognized for its culinary achievements.The restaurant pioneered the gastronomical movement in Brazil and continues to uphold its e legant blend of coeval 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 fabled Copacabana Palace as the top play den for Brazils rich 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 expertise.The hotel is designed in Bossa Nova-chic style and Brazilian touches compliment 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 attached Fasano access to the Brazilian market and enabled the company to take less gaga 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 incredibly high expectations. 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 adjudicate to compete with world-class conten ders. 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