Brazilian entrepreneurs and retail associations are seeking fair competition conditions with imports from abroad, especially from Asian countries. Approximately 500,000 international packages pass through Brazilian customs every day, but only about 2% of them are effectively inspected and taxed. This allows consumers to import products at significantly lower prices than those practiced within the country, creating an unfair competition scenario for the national market.
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The competition may not be fair, but the retail market needs to understand that cross-border e-commerce is a global and irreversible trend. The key to addressing these challenges is finding a way to combine the industry with the implementation of equitable rules that generate opportunities for everyone while respecting legal norms.
However, this is not the first time we have experienced major transformations in the market. The music industry faced similar challenges and successfully underwent a transition.
Lessons from the Music Industry
Led by Spotify, the music industry went through a successful transition. Initially, MP3 format songs allowed people to build vast virtual music libraries. However, accessing these songs was challenging as it required downloading files and storing them on devices. This led to piracy, which harmed the music industry and artists, reducing record labels’ revenues.
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This situation resulted in conflicts with initiatives offering free content, leading to legal actions against websites like Pirate Bay. However, nobody realized that the music industry would not disappear, and streaming platforms would continue to evolve.
Apple’s iPod enabled record labels and artists to earn from each downloaded song. However, adoption was limited as it required using a specific platform, and the majority of downloaded songs were still pirated.
That’s when Spotify realized that people valued access over ownership. This gave rise to streaming platforms, allowing songs to be “rented” and instantly shared on mobile devices without the need for special equipment. While access is free, additional services such as premium packages compensate those involved in the music industry.
In cross-border e-commerce, most taxes on international purchases go unpaid. However, users are not seeking to evade taxes. They desire a variety of products in an increasingly globalized and dynamic market. Therefore, the retail sector needs to shift its mindset regarding platforms and provide exactly what consumers want: variety, quality, and competitive prices.
Respecting Human Rights and Legalization
Furthermore, it’s crucial to consider respect for human rights. Currently, there is a growing concern about topics such as ESG (Environmental, Social, and Governance) and working conditions. The dynamic, modern, and innovative legalization of these operations can resolve all ecosystem challenges at once.
Similar to the music industry, where there was no single winner, the retail sector can also benefit various stakeholders, including entrepreneurs, fiscal entities, consumers, and international platforms. Applying intelligence, empathy, and cutting-edge technology is necessary to transform this situation into a favorable scenario for all.
