Business Start-up Pace in Brazil Decreases in 2023

In Brazil, from January to September this year, 1.4 million new companies came into existence.

This marks a 22.2% reduction compared to the previous year’s 1.8 million during the same period, signaling a market contraction.

Specifically, in September, 132.7 thousand new companies began, after factoring in both openings and closures.

That month witnessed the launch of 305.5 thousand businesses while 172.9 thousand concluded their operations, a significant decrease of 25.7% from September of the prior year.

This data, gathered from the Business Map Panels of the Ministry of Development, Industry, Commerce, and Services by Poder360, highlights a notable trend.

Currently, Brazil’s active companies total 22.1 million. Among these, 68.9% operate as Individual Microentrepreneurs (MEIs), and 29.7% function as limited liability partnerships.

During this period, the leading business activities among these companies were:

• Retail of clothing and accessories;
• Hair and beauty services, including hairdressing, manicures, and pedicures;
• Sales promotion activities;
• Construction and masonry work;
• General merchandise retailing.

On average, the process of establishing a company in Brazil takes one day. This efficiency varies with the performance of state commercial boards.

The setup time for an Individual Microenterprise (MEI) is shorter, at an average of 21.6 hours.

Setup Time for MEIs

Other business formats, like consortia of partnerships, require around 56.7 hours to establish on average.

Sergipe leads in efficiency, with an average setup time of under 7 hours in September.

On the other end, Pará recorded the longest average time, 38.8 hours, for new business registration.

This slowdown in new business openings can be contextualized regionally and globally, reflecting broader economic trends and local bureaucratic processes.

The agility of starting businesses in certain regions can often mirror the local government’s effectiveness and the overall economic health of the country.

This downshift could have implications for employment, innovation, and economic diversification in Brazil.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error