Guatemala

Overview

• The government has presented a social policy that contains over 190 commitments which include: reducing illiteracy rates, increasing health coverage, lowering child mortality, and generating new jobs.
• The recovery of the economy is leveling out due to weak business and a lack consumer confidence.
• Inflation has fallen to 4.4% and interest rates have fallen to near 20%.
• There was a real GDP growth decline 0.5% from 1999 to 2000, but it is expected to increase by 1% in the next year.
• Criticism of President Portillo recently led to a series of protests by human rights groups, indigenous people, and farmers.
• The price of coffee, Guatemala’s main agricultural export, has fallen, but the crop was the largest in recent years.
• Relations between Guatemala and the United States continue to be excellent.

Opportunities:

• Electric power
• Telecommunications
• Food products
• Apparel
• Planting seeds
• Hotel and restaurant equip. and supplies
• Cotton

Marketing Tips

• Most Guatemalan business people are used to doing business with the United States. Many of them speak English.
• Most business in Guatemala is conducted through personal relationships.
• Guatemalans are very enthusiastic that U.S. companies are forming franchising agreements.
• Direct marketing is the most common form of sales and distribution, while telemarketing and mail order sales are rarely used.
• The three most important factors that Guatemalans consider when purchasing are price, service, and quality. Being “Made in the U.S.A.” usually gives a strong advantage to products.
• Sales using distributors and local agents are the most effective way to reach a market.
• Around 65% of the population is indigenous Amerindians of Mayan decent.

Business Culture

• Guatemalan executives put great emphasis on personal contacts with suppliers. They want to get to know them and to form long lasting, trusting relationships.
• Local buyers tend to be extremely frank and open in their business negotiations and transactions.
• According to the Hofstede Scale: Guatemalans tend to focus on cooperation and teamwork. They also have autocratic bosses in hierarchical organizations. However, they do not like ambiguous and unpredictable situations. They are likely to value nurturing, cooperation, and compromise.

Legal Environment

References