Polyglot Group has been doing business with international & multicultural companies based in more than 50 countries all around the world for over 20 years.
In celebration of these partnerships, we will be promoting bilateral trades by interviewing some of the key players.
Keen to know more about the current challenges faced by the countries we are representing such as Latin America, Europe, Asia & the US, we are thrilled to share with you our interview with Harris Gomez, president of the Australia-Chile Chamber of Commerce (AChCC).
Could you please introduce yourself and your organisation?
I am the president of the Australia-Chile Chamber of Commerce, which has been operating for over 25 years. The chamber’s focus is both on business in Chile itself, in addition to the Chilean companies operating here in Australia. One of the commonly understood benefits of doing business in Chile is that it operates as a gateway to the rest of Latin America, including Peru, Columbia or even Argentina and Brazil. This is particularly advantageous as entering these markets can be challenging, especially when coming straight from Australia.
The Chilean Chamber provides members with specific custom made solutions. We offer practical help, such as explaining accounting, the banking system, insurances and systems of transporting.
We are fortunate enough to have a very good committee of experts who have all done business in Chile and/or the region in general, with some of them even currently living there. It is this practical experience which is really helpful for our members.
What type of services can you offer to Chilean companies looking for new business opportunities in Australia? How many Chilean companies are operating in Australia?
We pride ourselves on being able to provide a whole range of helpful services. Our extensive network means we provide help with recruitment and recommendation of members. We also provide legal support, plus accounting and/or insurance consulting. As I have mentioned previously, we help with the whole set-up and support Chilean businesses in their journey to establishment.
Are you subsidised by the Chilean government or is it membership based? How many members do you have?
We are a private membership-based service. Our chamber is constantly growing: at present, we have a just over 80 members. We operate very closely with the Peruvian and Brazilian chambers and constantly strive to reach new heights by such collaborations. We also work with the Latin American Business Council: a collaboration which we believe to be very logical. The Latin American Business Council is a larger body which specialises in keeping members informed, which complements our smaller, more practical service.
What are the organisation’s main accomplishments since you took office?
We host several seminars, including one last week which we organised with ProChile. We brought together all different members from different industries to share our knowledge on how to successfully transact with Chile. Some of the attendees were the Export Council of Australia, Austmine and Educational Department, just to name a few. Our chambers are very active and one of the main participants in such initiatives. Last year, we also held some seminars on the up and coming (Trans Pacific Partnership) with Australia. Next week, I will fly to Chile for the Expomin, a huge mining convention. Overall, our accomplishments are ongoing, matched by our incentive.
How do you perceive the Australasian region in general (regarding regulations, market trends, geography of business for Chile)?
China is obviously attractive to everyone, specifically in regard to procurement and sourcing cheaper materials. We know that large Chilean companies like EDELCA (a state-owned mining company) and Banco Chile have got offices in Shanghai. The number of Chilean business in Asia is not as large as the number of Australian companies, but obviously Asia is really important for Latin America, too.
What about Chilean’s business culture— are there any similarities to the Australian one?
Yes, we both share very similar business practices, including the administration of insurance and business contracts. For example, if there is an issue with a Chilean contract, an arbitration can be sought, just as in Australia. Even currency is a point of commonality, as it is typical to transact in USD rather than the local Chilean peso. In addition to business practices, Australian and Chilean work ethics are also quite similar, so there’s quite a lot of parallels when it comes to business culture.
In which industries/sectors of Australia do you see opportunities for Chilean companies?
I think there is ongoing potential and opportunities in agribusiness and in the aqua foods (as Chile is pretty strong in the salmon exportation). In addition to the obvious continuous prospects in the mining sector, I believe there are additional opportunities in niche areas including wine technology, and packaging, among plenty of other areas…
From your experience, what are the typical steps that Chilean companies undertake when expanding in Australia?
The obvious initial step is visiting Australia to explore and become familiar with the country. From here, companies then approach our chamber. In response, we will organise a meeting with the purpose of briefing the new company. We will help them to understand compliance with laws and legislation and how to initiate their expansion to Australia’s shore. Subsequently, the company will appoint an agent (or alternatively, set up a company here) and send a team from Chile to commence business.
What are the main challenges for Chilean companies entering Australia in 2016?
I believe the primary challenge is the cost of doing business in Australia, as it’s quite expensive for Chileans. The cost of employment is often larger than expected due to Australia’s higher salaries compared to that of Chile’s. I believe these initial start-up costs are certainly one of the main challenges which are sometimes overlooked. Appointing an Australian local director can also give rise to more challenges, as this is not a requirement in Chile. So, generally most of the challenges are financial ones.
What are the common mistakes that you might have noticed for companies that want to do business in Australia?
One of the most common mistakes is failing to have realistic expectation of expenses and not having a reasonable budget, as unfortunately, “hidden” expenses are common.
Another common mistake is overlooking the importance of trademarks: companies tend to postpone arranging protection for their IP (intellectual property). This mistake is a significant one, as brand protection is of uppermost importance. Often companies will want to set up a business first and trademark later, only to discover that the company name is already trademarked or in use.
Aside from these few problematic areas, setting up business in Australia is not too complex. The process is more straightforward compared to that in Chile, as procedures (such as hiring, acquiring insurance and setting up business accounts) are fairly straightforward.
What do you think about the current Free Trade Agreements between Chile and Australia?
I believe it is a very positive asset for Australian’s doing business in Chile (and vice versa). To be specific, 97% of tax is eliminated, which certainly opens new doors, as there are only a few Latin American countries that have that kind of free trade agreement with Australia. I believe this is just one piece of evidence which demonstrates the positive business and trade relationship between Chile and Australia.
Thank you to Harris for his insight and for taking the time to speak to us. If you are interested in knowing more on what the Australia-Chile Chamber of Commerce provides and how the organisation can help you, head over to their website to find out more.