MidReal Story
Global Sales: Navigating Challenges for Success
Scenario: DURAVIT products all over the world
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The plane landed in São Paulo, Brazil, and the team of DURAVIT sales executives was greeted by a local liaison named Maria.
She would be working closely with them to help them navigate the Brazilian market.
Emily Zhang, a sales executive from the company’s Shanghai office, was excited to be in Brazil for the first time.
She had never been to South America before and was looking forward to experiencing a new culture.
However, she was also a little nervous because she didn’t speak Portuguese and knew that communication would be a challenge.
Maria greeted them warmly at the airport and led them to her car.
As they drove through the city, she pointed out various landmarks and gave them some background information on the country and its people.
Emily tried to follow along as best she could, but it was difficult because Maria spoke so quickly.
She wished that she had taken some language classes before coming on this trip, but there just hadn’t been enough time.
After checking into their hotel, Maria took them out for dinner at a local churrascaria.
As they sat down to eat, Maria and John chatted away in Portuguese, while Emily struggled to keep up with the conversation.
She had been in Brazil for three weeks now, and she still didn’t understand much of the language.
Learning Portuguese was much harder than she had anticipated, and she was starting to worry that she would never get the hang of it.
The language barrier was a real problem.
Even though Maria was there to help translate for her, Emily knew that she couldn’t rely on her colleague to be there all the time.
If she was serious about her job, she needed to learn the language herself.
It was just a shame that there weren’t more resources available for her to do that.
She had tried listening to podcasts and watching Brazilian TV shows, but they hadn’t made much of a difference.
Maybe it was time to try something different.
As they drove back from dinner, Emily turned to Maria and said, “I really need to practice my Portuguese more.”
“I know,” Maria replied with a sympathetic smile.
“You’re doing great, but I can see that you’re struggling.
I’d be happy to work with you on your Portuguese if you’d like.”
“Thank you,” said Emily.
“That would be great.”
“I don’t think I’ll ever be fluent in Portuguese,” she continued with a sigh, “but it’s important for me to try at least.
I don’t want the language barrier to be an excuse for not being able to make any progress here.”
“It’s not easy,” said Maria encouragingly, “but I’m sure you’ll get the hang of it eventually.
Just keep practicing and don’t give up.”
Emily nodded thoughtfully.
“I won’t,” she said determinedly.
“I’ll do my best.”
John chuckled from the front seat, and Emily turned to look at him in surprise.
“You’re laughing at me?”
he asked with a grin.
“I didn’t mean it like that!”
He held up his hands in mock surrender, still chuckling.
“I’m not laughing at you, Emily.
I’m just amused by how much trouble you’re having with Portuguese.
You know that I speak Spanish too, right?
It’s similar to Portuguese—kind of like Mandarin and Cantonese are similar to each other—so if I can learn Portuguese, you can too.”
Maria chuckled from the driver’s seat and said, “That’s true.
It shouldn’t be too hard for you.”
Emily smiled sheepishly and said, “I know, I know.
I didn’t realize that the language barrier would be such a big issue for me when I took this job.
I thought I’d be able to pick up enough Portuguese on the fly to get by.”
John nodded in understanding and said, “It’s not your fault.
Even though I can speak Spanish, I have trouble with Portuguese too.
After all this time in Brazil, I still find myself using Spanish words instead of Portuguese ones sometimes.”
“Really?”
exclaimed Emily in surprise.
“If you’re struggling with Portuguese too, then there’s no hope for me!”
After a few moments of silence, she said, “But let’s talk about tomorrow’s negotiation instead of worrying about your Portuguese for now.”
John nodded and said, “Good idea.Let’s do that.”
The three of them discussed their strategy for tomorrow’s negotiation over lunch the next day.
They had been tasked with persuading Casas Bahia—a large Brazilian retail chain—to carry DURAVIT products in their stores across Brazil as well as feature them prominently in their display areas.
The retailer was already carrying some DURAVIT products in its stores, but they were being displayed on lower shelves at the back where they weren’t very noticeable or accessible to customers.
The team had been sent to Brazil to change that situation and make sure that Casas Bahia was displaying DURAVIT products more prominently so that they would be able to attract more customers and increase their sales volume.
Emily was impressed by the team’s presentation and thought that they had a good chance of achieving their objectives with Casas Bahia tomorrow—until John said, “We should offer them a 30% discount.”
She stared at him in shock and exclaimed, “30%?
That seems like a lot!”
Maria nodded in agreement and said, “It is a lot!
That’s quite a big chunk of our profit margin.”
John shrugged and said, “I know it is—that’s why I suggested it.”
He flashed a charming grin and added with a wink, “A little sweet talk and they might even agree to a 40% discount Just kidding!”
Maria laughed and said, “You’re such a flirt!”
Emily was still feeling shocked by the idea of offering a 30% discount when John turned back to her and said with a smile, “The reason I suggested such a high discount is because I know that Casas Bahia is going to counter with a lower one anyway—and I don’t want us to go below 20% if we can avoid it.”
“Casas Bahia is famous for its bargaining power,” added Maria with a nod of agreement.
“They’re one of the biggest retailers in Brazil so they have a lot of influence over their suppliers.They often dictate terms rather than agreeing to them.”
“So we need to be careful about our discount,” said John with a frown of concern.
“I don’t think we should agree to a 30% discount,” said Maria with a shake of her head.
“But we need to offer something if we want to get the best display area,” said John with a frown of concern.
“Why don’t we offer them a 10% discount instead?
That’s still a pretty good discount and we’d still be able to—“
“No way!”
exclaimed Maria with another shake of her head.
Emily stared at them in surprise and said, “But why not?”
Maria turned to her and said, “In Brazil, it’s very common for suppliers to offer large discounts to large retailers like Casas Bahia in order to get them to carry their products.The competition is fierce here and the Brazilian market is very demanding.So if we want to compete—and we do—then we need to adapt and play by Brazilian rules—which means that offering discounts like 30% or more isn’t as uncommon as you might think.”
“But won’t our products become devalued if we offer such a high discount?”
asked Emily with a frown of concern.
“Honestly, I think it would be better if we didn’t offer any discount at all,” added Emily.
“I can understand that you feel this way, Emily,” said John with a frown of concern.
“But you do know that when it comes to sales, the customer’s perception is more important than reality, right?”
“Yes, I know,” said Emily with a nod of agreement.
“But I also think that if we offer such a high discount, the customer will think that we’re desperate.
And that our products aren’t worth the price.”
“So what would you suggest we do instead?”
asked John with a frown of concern.
“I think that it would be a good idea for us to sit down and consider our options,” said Emily.
“I’d like to take some time and look at the data before I make any recommendations.”
John stared at her in surprise and said, “You are aware that this is a time-sensitive situation, right?”
He flashed a charming smile and added, “But I’m sure you have everything under control.”
“I hope so,” replied Emily with a wry smile.
It wasn’t the most reassuring answer, but she couldn’t think of anything better to say.
And honestly, she wasn’t even sure herself.
She was worried that if they offered such a high discount, they could set a bad precedent.
If other chain stores found out about the discount, they might ask for similar discounts—and then it would become much harder for them to sell their products at full price.
She was also worried that if customers found out that they had sold their products to such a large retailer at such a high discount, they might stop buying them.
After all, no one wants to pay full price for something that they know was sold to someone else at a discount.
And especially since DURAVIT was known for making good quality products.
If customers could get those products at a discount, then they’d feel even better about their purchase.
So she was worried that if they offered Casas Bahia a high discount, then they could end up devaluing DURAVIT’s brand.
“I’ve never had a sales executive argue with me about offering a discount before,” said John with a frown of concern after Emily left the room.
“To be honest, I don’t see what the problem is,” said John with a shake of his head.
“DURAVIT is a company in China,” explained Maria with a frown of concern.
“A lot of people think that Chinese products are cheap.
And it’s true that many of them are.But not all of them.
DURAVIT has a very premium image and makes products for the high-end market.The reason why we’re able to charge high prices and still sell a lot of products is that we have a lot of advantages in terms of quality and production costs in China.
We have our own state-of-the art factories and use the best materials and latest technology, so the quality of our products is actually higher than those made in many other countries, including Brazil.And because we manufacture everything in China, we’re able to save on labor costs, which means that we can produce our products more quickly and in larger quantities, so even though we sell them at a higher price, we still have higher profit margins than our competitors.”
John’s eyes widened in surprise and said, “Wow, I had no idea!”
Maria smiled at him and said, “Yes, that’s how we’re able to stay competitive in the Brazilian market—and still make money even when we offer big discounts.”
John nodded thoughtfully and said, “That actually makes a lot of sense.”
“But I think that we should still be careful about how much of a discount we offer,” added Maria.
