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Country Commercial Guides for FY 2000: Cape Verde Report prepared by U.S. Embassy Praia, released July 1999

CHAPTER IV:   Marketing U.S. Products and Services

Distribution and Sales Channels

There is great receptivity for American goods and services in the Cape Verdean market. In the past, U.S. products have reached the Cape Verdean market either through bilateral cooperation projects, or informally through the Cape Verdean community in the U.S. (New England mainly).

Distribution and marketing facilities are not yet fully developed and the principal methods of selling are: retail outlets, an agent or distributor, selling through established wholesalers and selling directly to the government.

A limited number of agents do currently conduct business with foreign firms and some have been inquiring about representing American firms. Agents and distributors commonly represent several product lines. It is advisable that a company attempting to break into the market retain a person resident in Cape Verde who should be fluent in Portuguese. If the exported product requires servicing, qualified personnel and a reasonable inventory of spare parts must be considered. European competitors inevitably market their geographic proximity as a competitive advantage; they are often able to provide a technician or part on short notice.

Many of the products sold in Cape Verde pass through wholesale organizations. Most of the wholesale establishments and modern retail outlets are concentrated in the two main urban centers: Praia and Mindelo.

Private sector enterprises can purchase goods directly or through an agent, while public sector companies are required by law, to make their purchases through procurement tenders. The procurement is typically financed by a multilateral lending institutions such as the World Bank or the African Development Bank.

Therefore, opportunities do exist for companies willing to develop their own marketing, distribution and maintenance networks.

Forms of Business Organizations

Branches of foreign companies may not be established until they are registered with the registrar of companies. Joint ventures are allowed and encouraged in many sectors, namely in fisheries, the airline business and telecommunications. The most common forms adopted by businesses in Cape Verde include: 1) branch of a foreign company; 2) joint-venture; 3) limited liability company and 4) stock corporations. Other business forms include regional offices, sole proprietorships, local agency or distributorship arrangements, and state or partially state-owned companies. Franchises are not a factor as yet in the Cape Verdean business environment.

Advertising and Trade Promotion

Advertising is done mainly through newspapers, television and radio. There are two widely read weekly private publications and an official one which comes out three times a week. Television is government controlled and it broadcasts six hours a day. The national television also has special agreements with French and Portuguese channels which allow them to be broadcast in Cape Verde . There is a state-owned radio station with headquarters in Praia, the capital, and two private ones.

Radio and television spots are the most widely forms of advertising. Trade fairs are sporadic but nevertheless a popular means of reaching the Cape Verdean buyer. Packaging is important to the Cape Verdean consumer. Eye-catching, colorful designs, and small, reusable containers appeal to the consumer.

Major newspapers are:

• "Horizonte", C.P. 40-A, Praia, Cape Verde, Tel: (238) 62 30 25; 62 24 47;
  Fax: (238) 62 30 23; 62 33 30.
• "A Semana", C.P. 36-C, Praia, Cape Verde, Tel: (238) 61 39 50; 61 12 69
  Fax: (238) 61 12 82; 61 52 91.
• "Cifrão", C.P. 36-C, Tel: (238) 61 39 50; 61 12 82;
  Fax: (238) 61 12 82; 61 52 91
• "Terra Nova", C.P. 166, S.Vicente, Cape Verde, Tel: (238) 32 24 42.