Dzemail Kurtovic, Marvin Ting, Sabrina Argiro, Danielle Lego ,Ms.

Rasmita Budhathoki

Geography: Central Chile has warm dry summers ( 67 degrees) and wet cool winters (average of 46 degrees). The
country capital, Santiago, is in this region.
Family: Occupies central role in an individuals life with extended families are very close. Family and business is often
intertwined.
Education: Chile has been improving their education systems since 1990. Literacy rates are above 90% in most age
groups.
Politics: Chile has a Representative Democratic Republic. The President is elected and is both the head of state and head
of government. As of currently, Chile is politically stable.
Class Structure: Chilean classes are defined by financial standing. Social classes are fluid and emphasis is placed on
outward appearance.
Religion: Roman Catholicism is the predominant religion in Chile. Religion plays an important role in social and political
life.
Recreation: Skiing and snowboarding Pickup Convoy Tours Rafting Canyoning Horseback Riding
Sea-kayaking Climbing Trekking Fishing Sailing

Chile- Language, Culture, Customs and Etiquette. Kwintessential, Chile-Literacy Rate. Index Mundi,
Outdoor Activities in Chile. Travel Chile, Chile Weather and Climate. Latin America Collection,
In 2011, Chiles GDP expanded by 5.8% while per capita income reached its
highest level in nine years
Chile has an attractive business environment
It is the first country in Latin America and 7
th
among 179 countries worldwide
for economic freedom
According to the Business Environment Ranking 2010-2014, Chile was first in
Latin America and 15
th
among 82 economies worldwide for its business friendly
environment.
Central Intelligence Agency. (2013). South Africa. In The world factbook.
The Heritage Foundation. (2014). 2014 Index of Economic Freedom


In order to ensure we wanted to venture into Chile, we decided to compare it to
another South American country- Brazil
Investment Freedom
Brazil- Red
Chile- Green
Economic Freedom
The Heritage Foundation. (2014). 2014 Index of Economic
Freedom.


Chile is Tax-Friendly
Lowest tax rates in Latin America
One of the lowest corporate income tax rates worldwide- 20%
Has tax treaties with the United States
Chile is Latin Americas most competitive economy
Ranked 34 out of 148 countries worldwide
Ranked 17
th
worldwide for macroeconomic stability
Ranked 29
th
worldwide for openness to foreign trade

These factors prove that Chiles economy is constantly increasing and their business friendly environment
is attractive to our company.
We also want a low-risk country to enter into since we are taking such a big risk by expanding our
company. These factors prove that Chile is a great place to invest in
World Economic Forum. (n.d.). The Global Competitiveness Index 20132014: Country Profile Highlights.
World Economic Forum. (n.d.). Global Competitiveness Report 2013-2014.


Although Chile offers great market advantages, there are also
some disadvantages.
Despite their openness to new products, Chilean business
people are smart but tend to be more cautious and
conservative than the business people in the U.S. This is
something we need to overcome before venturing there.
U.S. Department of Commerce. (2013). Doing Business in Chile: 2013 Country Commercial Guide for U.S. Companies
(U.S. & Foreign Commercial Service, Author).
In order to overcome this challenge, we decided to have a
good agent that is located in Chile.
This person can use their connections to open doors and
overcome barriers such as culture and language
InvestChile will help us
U.S. Department of Commerce. (2013). Doing Business in Chile: 2013 Country Commercial Guide for U.S. Companies
(U.S. & Foreign Commercial Service, Author).
KPMG. (2012). Doing Business in Chile.
Created in 2000, it provides a range of
assistance to foreign companies interested in
locating in Chile

Source: KPMG, 2012
U.S. Department of Commerce. (2013). Doing Business in Chile: 2013 Country Commercial Guide for U.S. Companies
(U.S. & Foreign Commercial Service, Author).
KPMG. (2012). Doing Business in Chile.
United States and Chile have a trade agreement known as the Chile Free Trade
Agreement (FTA), established in 2004
Duties are reduced to zero on 90% of U.S. exports to Chile
This was a helpful factor to find out since we will be manufacturing our
products in the United States in order to live up to our Made in the USA
mission.
The U.S. also remains the largest cumulative investor in Chile
By finding out that the United States has such a large investment in another
country proves that U.S. companies have succeeded in Chile which is vital to
our research.

U.S. Department of Commerce. (2013). Doing Business in Chile: 2013 Country Commercial Guide for U.S. Companies
(U.S. & Foreign Commercial Service, Author).
Corporate office will deal with any problems that occur in our
Experience store
Will oversee operations
Not expensive or time consuming
Takes about three weeks and costs approximately US$
1500 for legal fees and US$ 250 for other expenses
U.S. Department of Commerce. (2013). Doing Business in Chile: 2013 Country Commercial Guide for U.S. Companies
(U.S. & Foreign Commercial Service, Author).

Over 100 hiking treks
o Some famous hiking trails include The Atacama Desert and The Patagonia
Trek.
An expanding market for footwear,
o volume of shoes hitting 47 million pairs a year > per capita consumption
stands at 3.1 new pairs each year
o Total shoes imports worth $177 million, size of shoe market soared 1000% is
last ten years
Main channels of distribution: department stores and supermarkets
40% of these shoes are made in Chile and 60% are imported, mainly from China -
good opportunity for New Balance













http://research.hktdc.com/business-news/vp-article/en/1/1X07NANJ.htm
It has more than 4 million people
o 40% of the countrys population and most densely populated region in Chile.
Over 40% percent of people from age 18 to 25 like doing outdoor activities
New Balance role: making Santiago more active and engaged
New shopping experience for young adults
High income gap between the rich and the poor
o Target customers that make over 400 dollars per week
Shopping Habit:
o Spend 30 percent of their income on personal care, clothes and footwear
o Population not into online shopping, prefer to browse through shops
Promotion:
o Main focus on Social media; Facebook and twitter
o Informational brochures, coupons
Pricing strategy:
o Premium Pricing
Coupons will be used only the first 3 months
Higher price than competitors
Price comes with unique shopping experience and product being
different from the competitors



Adidas Nike Newbalance
31 retail stores in
Santiago
Well established
Target all ages and
middle class and
higher
Mostly made in China
Normal store setting
All kinds of shoes

13 retail stores in
Santiago
Well established
Target all ages and
middle class and
higher
Mostly made in China
normal store setting
All kinds of shoes
1st store
New Balance Experience-
1st store
New in the market
18-25 ages/ upper
middle class and high
class
Made in USA
Experience Store
Main focus in Hiking
shoes

Our target market as stated before will be 18-25 year olds.
We plan on making people active and engaged in New Balance.
We are opening this New Balance Experience store to make the people a
part of us.
Opening in the capital of santiago will generate the most profit.
We want to be in schools and parks.
Chileans are big on Athletics.
2nd story wood company will help us design.
Focus on hiking shoes.

SWOT for hiking sneakers & Experience store
Strengths
- Very durable sneaker
- Everything made in U.S.A
- Great boots for mountain terrain.
- Hosting events like marathons and triathlons.
- Very involved with people.
Weakness
- Not a company that takes to many risks
- Corporate offices very far away
- Completely new environment

Opportunity
- New Balance experience stores did well in England and
Spain, Barcelona.
- Fresh new market
- Chile has a sustained economic growth
- Imports and exports have been on a rise.
- Santiago rated best combination of quality in life & business
potential.
Threats
- Other more popular companies like adidas and nike.
- Sustaining exports to chile
- Changing economy

Chile is a country with many types of landscapes but full of mountains
and trails.
We will adapt to the culture of their outdoor life.
Sneakers will be made in the colors of their nation.
The sole of the sneaker has to be very durable because it is used for
hiking.
Products are marketed primarily by direct import or through a
distributor.
Our current focus is social media.
o Chile has the 5th highest usage of social networking sites
o No cost
o Very big part of todays culture
o Primarily Facebook & Twitter
Our consumers will receive the latest updates
o New products
o Latest events
o Notified on the latest sales or deals
o Interactivity with consumers, creating customer relationships
http://www.ilovechile.cl/2011/09/21/chile-5th-highest-social-networking-usage-worldwide/32451


Currently, there is only one New Balance store in Chile

Our plan is to open an Experience store in the capital of Chile, Santiago.
o Customers can view and purchase exclusive colorways only available
in Chile.
o They will also be able to customize their personal shoe in the store
o We will feature New Balances Hiking shoes line

If the Experience store is successful, we will open more New Balance
stores in Puente Alto, Antofagasta, and Vina del Mar.
1)Import taxes and value-added taxes

2)Wholesale and retail markups and discounts

3)Companys gross margins

4)Retail price

5) 150$ FAIR PRICE.







Expand target market

Introduce more products like apparel and other type of shoes.

Open two more experience stores in the north and south and cities like Puente alto and
Antofagasta.

Invest more into advertising

Eventually open local offices for customer service