Institutional Channels in Brazil

Middle-class Brazilians going back to public industry options

Brazil as of 2016 was undergoing a severe recessive cycle, with consumers’ disposable incomes suffering noticeable constraints. Therefore, Brazilians who climbed up to the middle class during times of economic prosperity and had the opportunity of using services provided by private institutions (in areas such as healthcare and education, for instance) are now turning back to public industries.

Working women and ageing population boost residential care facilities for the elderly

Residential care facilities for the elderly in Brazil underwent strong growth over the review period, following the ageing population of the country. Besides the enlargement of the share of elderly people within Brazil’s population, the fact that there was a strong trend towards women entering the labour market in the past few decades changed the family structure within which older people were cared for at home. Both these factors combined to help boost the appearance of such institutions.

Specific, sophisticated demands favour capitalised contract foodservice players

High-end healthcare institutions increasingly incorporated hospitality concepts over the review period, with special attention paid to sanitary issues and professional dietary monitoring. For these reasons, in order to gain operational efficiency as well as to provide better-quality meals, most upmarket hospitals outsourced their foodservice to providers with highly skilled, professionalised operations.

Facility management’s performance influenced by the construction industry

The real estate and construction industries are the most relevant drivers for facility management in Brazil. In previous years, construction recorded strong growth, but suffered towards the end of the review period alongside the poor economic performance of the Brazilian economy. Thus, although still expanding, facility management registered a slowdown in growth towards the end of the review period.

Channel performances depend on Brazil’s recovery from political and economic crisis

The country is facing not only one of its harshest economic crises, but also a moment of political turmoil as well with the impeachment of elected president Dilma Rousseff. Industries such as construction and manufacturing – perceived as important channels for service providers and distributors – have been the most affected and may register only a slow recovery over the forecast period. Michel Temer, appointed in 2016 as Brazil’s president until 2018, faces the challenge of recovering confidence in Brazil’s economy while struggling with his own low popularity ratings.

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