The famous videogames producer, Nintendo announced on Saturday it has decided to close its operations in Brazil on account of high import charges and the way business is conducted in the Latin American country. The company decided to end its association with its distributor within Brazil and has not announced any immediate intention to replace it.
Gaming do Brasil retailed Nintendo items in the nation for about four years. Even if it will no longer distribute the Nintendo titles in Brazil, the mother company- Juegos de Video Latinoamérica will go on retailing Nintendo’s merchandise in the rest of Latin American countries.
The organization is one of numerous who have seen their items retailed for more than they ought to. Also, Brazilian residents experience difficulty obtaining the items because of the high expenses and cash restrictions in local stores. These obstacles have pushed Nintendo out of the Brazilian market for the time being but the retreat may not last forever.
Nintendo chose not to set up a manufacturing branch in Brazil and this prompted high import levies for its games and consoles. While the Nintendo Wii U was evaluated at $830 in the US, the console was almost twice more expensive in Brazil, being retailed at R$ 1899. The games, which usually have an average price of $60, are also more expensive in the Latin American nation, ranging from $77 to $87. According to Nintendo’s general manger, Van Zyll, Brazil has high import duties and the expenses don’t make any sense for the company.
But Nintendo isn’t the only games and consoles producer affected by Brazil’s the import taxes. Xbox One and PlayStation 4 fans in the country have to pay $800 and $1500 more for the devices. According to a blog entry signed by Mark Stanley from Sony Latin America, Sony PS4 would cost R$ 3,999 if import charges are added.
Nintendo representatives remarked that Brazil was a nation which had countless fans of its products but the difficulties attached to the business model in the country made the company’s venture unsustainable. The videogames producer said it will keep an eye on the Brazilian business environment for a future opportunity to satisfy its buyers’ demands there.
Out of 189 nations, Brazil got the 120 spot and was stamped ‘ineffective’ in the “ease of doing business” classification made by the World Bank in 2014. As indicated by reports, the nation had the lowermost score in “paying taxes” class. Businesses need about 2,600 hours to abide the tax regulations in Brazil while the average time in Latin America countries is 266 hours. Until the issue is dealt with, Brazilian Nintendo clients will need to import their favorite products from Japan, United States, Paraguay or other Latin American nations.
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