2024-08-20 | By Brazilian Footwear
The young Tropical Brasil, created in 2021, in the midst of the crisis caused by the Covid-19 pandemics, has been surprising by the numbers. With a production of beach slippers and sandals with the "Northeastern DNA", the company from Juazeiro do Norte/CE should grow in 2024 and expand its exports from 2025. The head of the business is Ananias Vieira Lins Neto, who spoke with Brazilian Footwear.
Brazilian Footwear: How did Tropical Brasil come about?
Ananias Vieira Lins Neto: Tropical Brasil was created in 2021, when we identified an important niche in the Brazilian market, for beach slippers and sandals that united quality, differentiated design and competitive price. With a vertical structure, in which we ourselves produce part of our raw material, we began with a production of 40 thousand pairs monthly and employ about 50 people. Growing exponentially, practically doubling the production every year, we should end 2024 producing more than 240 thousand pairs per month and employing more than 150 people directly.
Brazilian Footwear: were you already in the shoemaking industry?
Grandson: My family owns shoe and components factories here in Juazeiro do Norte. I was born in this environment, breathing footwear. I have a law degree and worked in the agribusiness area between 2014 and 2021. In 2021, we created Tropical Brasil.
Brazilian Footwear: it was a risky strategy. What were you thinking at the time?
Neto: we saw an opportunity in this market to create quality slippers, with refined aesthetics and a price that would fit in the Brazilian's pocket. As difficult as the moment was, the market was asking for this type of product. And it worked out very well, so much so that we doubled production the following year.
Brazilian Footwear: with this exponential growth, I imagine that the company is hiring and expanding its production capacity. Does Tropical Brasil have open job posts?
Neto: Yes, we have more than 20 open positions, both in administrative and production.
Brazilian Footwear: How is the local workforce?
Neto: we have an abundant workforce, but we often run into qualification issues. Then, we organize trainings for new employees, which are guided by our consultants, by the most experienced, always with supervision of our production management. It's been very successful. We have a low turnover and this shows that we are on the right track, because people like the company, they like our industry.
Brazilian Footwear: does the company export?
Neto: currently our focus is on the domestic market, and we export about 5% of our production in a more reactive way, that is, customers come to us, usually at Brazilian shoe fairs.
Brazilian Footwear: And will this share be expanded in the coming years?
Neto: Yes, we are organizing for sustainable growth in exports. For 2025, we want to increase the exported share to around 15%, with a focus on Latin America and Europe. We believe that there is room for this growth, not least because consumers like this northeastern and beach DNA, with colorful and patterned slippers.
Brazilian Footwear: does the company forecast growth for 2024? And for 2025?
Neto: we will end the year with twice as much as was produced in 2023. For 2025, our goal is to consolidate the brand in the national market and work more on exports. The estimated growth is between 50% and 60%.
Brazilian Footwear: what are the challenges that hinder the growth of the footwear sector in Brazil?
Neto: I believe that the most complicated of them is our high tax burden, followed by logistical difficulties, which are amplified for us, who are in the Northeast. It's a lot of bad roads and no safety. Sometimes to get goods to the North, which is close, it takes 30 days. This fact makes it very difficult, especially due to the supply disruption.
Brazilian Footwear: an agreement between the Federal Government and the National Congress should guarantee the full payroll exemption until the end of 2024, with hybrid collection by 2027 and resuming the old system in 2028. How does the exemption impact Tropical Brasil?
Neto: Payroll exemption is a very important tool for the competitiveness of the sector and promotes job creation. Certainly, if we have such a setback, we will have to slow down when it comes to growth, we will hire less and we will have a harder time competing in the market. With the payroll reoneration, we would have an increase of at least 10% in our global tax burden.
Brazilian Footwear: the company also participated in the second edition of BFSHOW. What is the evaluation of the fair?
Neto: BFSHOW was very important not only in closing deals with the domestic and international market, but also for the positioning of our brand and the prospecting of new markets. In fact, the 5% we exported was sold at the fair. The same thing happened with a distributor from Ecuador, with whom we had already been talking, but which we formalized at BFSHOW. For next year, in the Summer edition, we will be there again.
Brazilian Footwear: what is the importance of the ESG concept for the company?
Neto: We were born with the intention of following ESG guidelines. Currently, we work with waste reprocessing in production, both our own and those of third parties, and we acquire raw materials from suppliers that act in accordance with the best environmental practices. We also have a very important social role in the community, as we generate local jobs and qualify our employees, not only to work here in the company, but for their entire professional life.
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