The Art of the Deal in Brazil


The Art of the Deal in Brazil

A common faux pas that a North American might make when
dealing with a Brazilian would be to
wave away the initial
relationship-establishing process as a time waster. That is because,
for the most
part, we North Americans, with our traditionally
Calvinistic values, come from a low context culture.

by:

Loretta Murphy

 

I just recently decided to sell my car—a 1994 Fiat Uno Mille. Don’t recognize it? Well, it’s only the second most
popular car in Brazil, next to the Volkswagen Beetle, of course.

It’s quite a decision considering that a seemingly simple process can be turned into a bureaucratic nightmare,
chasing after bits of official papers in federal and municipal offices to keep the government, in all its forms, happy. But, hey,
those are the risks and irritations of doing business in developing countries. What was really interesting was not the results but
rather, the means: the negotiation process.

I put an ad in the local newspapers and immediately got a few interested phone calls. The Fiat Uno Mille is well
known for its reliability, fair mileage and practicality—a sound investment, as far as cars go. A few people came by to take a
look, including Senhor Oswaldo who, upon a superficial examination of the car, confessed that he didn’t know a thing about
the finer points of vehicle purchasing, but would return tomorrow with a friend who was an expert. In Brazil, everybody
either is an expert, or has a friend or relative who is one.

The next day, Sr. Oswaldo showed up with his expert who ground the gears, bounced the tires and pronounced my
little car worthy of $R 5,800 (US$ 1,930). I, honest and straightforward foreigner that I am, had written in the newspaper
announcement $R 6,500 (US$ 2,160). Because I wanted R$ 6,500.

Obviously I am not a brilliant negotiator and had almost sent them away as my husband pulled his car into the
garage. My husband is a true Brazilian in every sense of the word—dynamic, outgoing, skilful conversationalist—he knows how
to play the game.

He came bounding over, heartily shook the men’s hands as he introduced himself, and launched into telling them
about how stressful his day had been. I felt a little irritation, as I didn’t really want to sit around and chat with them. If they
weren’t interested in paying my price then what was the point?

From my husband’s account of his work- day, the two men discovered that he was a dentist. "Ah—my cousin is a
dentist. Do you know him—João Fulano?"

"Oh sure!" exclaimed my husband. "He was one year behind me in university! Nice guy, that João. Where is he now?"

Half an hour later, after learning about João’s location, family situation and even what kind of car he was driving, I
was tapping my foot and wondering why my husband was wasting his time. Suddenly he throws it out there: "So, Oswaldo,
why don’t you pay R$ 6, 400.00 and take the car home with you?"

"That car has a lot of work to be done. I’ll give you R$ 6000,00."

"How about R$ 6,200?"

I looked at my husband incredulously. He was going too low.

They must have seen my look of surprise because they all laughed and said, "Dona Loretta doesn’t want to close the
deal. That’s okay. You think about my offer and call me."

"Oh, stop being such a penny pincher!" my husband joked. "How about R$ 6,200."

"No sorry—my offer stands at R$ 6,000"

All the while this inoffensive banter was going on, I was observing the postures and physical positions of the men.
We had started out with the four of us in a little circle, my husband shifting nervously and pacing. The other two men kept
taking little steps to the left and shifting their weight. By the end of the conversation, our little circle had shifted 180°. Had I
not accompanied the shifting, I would eventually have been with my back towards the Circle of Negotiation!

"Just pay R$ 6,100—it’s only R$ 100 more," the expert chipped in.

More humming and hawing. More discussion about João.

Finally, Sr. Oswaldo agreed R$ 6,100 would be deposited into my account tomorrow and he would return on
Monday to pick up the car, with the proof of deposit. It was a done deal—the bulk of the business having taken place in the last 5
minutes of an hour-long conversation about nothing!

I was relieved to have sold the car and perplexed as to the mysterious labyrinth of the Brazilian negotiating process.

Brazil is an incredibly rich culture, often described as being founded on a racial triangle. The three corner points
being Portuguese, African and Native cultures. From the mixture of these three cultural influences, emerged the Brazil that we
know and love today. According to Gilberto Freyre, one of the most famous Brazilian sociologists, one of the key
characteristics of the Brazilian people is "personalism". This refers to a society based on personal relations and a strong emphasis on a
feeling of closeness and affection in personal relationships. This explains why the car negotiation process started out by
associating a common middle person.

It is very common when Brazilians meet each other for the first time for them to attempt to establish some kind of
common ground—relatives or friends of friends. In other words, as long as someone-I- know knows someone-you-know, you
must be trustworthy, and if you aren’t, then at least I know who to complain to, and they will be embarrassed by your untrustworthiness.

A common faux pas that a North American might make when dealing with a Brazilian would be to wave away the
initial relationship-establishing process as a time waster. That is because, for the most part, we North Americans, with our
traditionally Calvinistic values, come from a low context culture. We value the direct exchange of facts and information that
is transmitted explicitly into words and documents. As a Canadian, I was taught that everyone should be treated equally,
regardless of whom you know.

How can this be related to business? By gaining knowledge of our counterparts’ behaviour and attitudes, we can
expect certain reactions and prevent potentially embarrassing situations. Brazil is considered to be a high context culture. This
means that shared experience can make certain rules for behaviour and verbal communication implicitly understood. So, be
sure to "read between the lines", play the game properly and avoid missing opportunities, like I almost did!

 

Loretta Murphy is a Canadian who first came to Brazil (Nova Friburgo, Rio de Janeiro) as a Rotary Exchange
student in 1987. She has traveled extensively throughout the country and has lived in Salvador, Bahia since 1997. Her interest
in Brazilian culture has recently led her to complete a monograph entitled "Cultural Differences in Brazilian and
Canadian Organizations" on which this article was based. For further information, e-mail her at
lormur@terra.com.br

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