Survival of the fittest: how small and medium companies harness resources to succeed in the Brazilian imports market

This present study analyses, under the resource-based view (RBV) and the transaction cost theory (TCT) approach, small and medium import companies operating in the non-durable consumer goods sector in Brazil. The RBV theory focuses on the internal resources owned or accessed by a company that could lead the firm to obtain a sustainable competitive advantage, while the TCT covers the dichotomy of ownership and flexibility of activities and dealing with uncertainty. After gathering information about the macro-environmental context in which the companies are, and the inherent complexities involved, such as exchange rate fluctuation, port infrastructure, freight cost, legislations and bureaucracy, a qualitative phenomenological research was conducted with executives in the sector in order to evaluate their perception of the business and to identify the internal resources each company has at its disposal. Those resources are subject to evaluation using the VRIO framework, which intends to check whether a resource is valuable, rare and easy to imitate. Therefore, it can be classified – or not – as a source of sustainable competitive advantage. Results show that, among small and medium sized companies, there aren’t too many sources of competitive advantage, with few exceptions. The way companies deal with adversities and challenges are similar and, therefore, pricing plays an important role as an important variable while in this business.