Flavio Maluf on Small Business Investment Increasing Demand

Figures from the Credit Protection Service and the National Confederation of Shopkeepers investment propensity Indicator conducted in July, 2016 showed small and medium businesses intending to make new investments. The small and medium-sized retailers and service providers in Brazil showed an intention to increase their investments. The figure had grown from 21.37 points in June to 24.20 points in July. Flavio Maluf, a businessman from Brazil, however, noted that this number had not yet overtaken the highest score that had been obtained in May 2015 (25.22) and still way off the 32.06 that was the top of the series historically.

Economic Instability

Given the percentages, Flavio Maluf pointed out that over 72% of the micro and small Brazilian businessmen involved in the services and retail sector had in July bore no pretension of making investments in the coming three months. They pointed to the economic instability prevailing then as the main reason influencing their decisions. About 29.0% saw no need to invest then but another 12.3% had already made their investments months earlier. The only percentage that showed an interest in making investments three months after July stood at 20.9%.

Reasons for Investing

Flavio considered the reasons why most of these businessmen desired to invest and only 26.9% wanted to expand or reform their businesses while 25.7% of them wanted to expand their inventories. Afterwards there was a sudden desire to invest in advertising and communication with a 23.4% increase. Over 72% of all the investors who intended to make investments wanted to leverage their sales while 8.4% desired to adapt their businesses to technology. On matters credit, 88% of the investors did not want to take it in the coming three months and only 5.6% percent considered it. This was due to the high interest rates charged on credit and 48.5% of them stated they would use their own resources.

About Flavio Maluf

Flavio is a mechanical engineer by professional as well as a renowned Brazilian businessman. He graduated from Armando Alvares Penteado Foundation (FAAP) with his mechanical engineering bachelor’s degree. Since April 29, 2005, Mr. Maluf has been the president and CEO of his family business, Eucatex company. He is also the leader of GrandFood Group that owns the Premier Pet and Golden feed brands.