Toli: Fashion Industry Franchising in Rio Grande do Norte

Interview with Amauri Fonseca, President of Toli and CDL Natal (Natal’s Chamber of Shopkeepers)

I would like you to start our interview with a brief presentation of the clothing and textile industry in Rio Grande do Norte.

Rio Grande do Norte doesn’t have a big potential in that area, although the biggest factory in that area (Riachuelo) is situated in this state. Labor and raw material supply are still very precarious but we have very skilled labor and, with the tax incentives given by the government, we are able to have competitive advantages.

Speaking specifically about Toli, what is the background of the company? What types of products are manufactured here and how many employees do you have?

I founded the company 20 years ago with the sole purpose of manufacturing promotional products like t-shirts, uniforms for events… I started looking at fashion with pleasure and I started working just in that area. Fashion is a very fascinating and dynamic world.

Nowadays, Toli has 35 stores, all situated in the north and northeast region. Counting all employees in the factory and in the stores, we have more than 500. Toli started as a micro backyard company that has developed and grown. Everything that we have learned made us a very organized and strong company.

What are the main competitive factors that distinguish Toli from other regional and national companies?

We started as an industry. We entered the retail business with the stores and embarked on the franchise system. Nowadays, Toli manufactures fashion for women between 25 and 35 years old and our products are very diversified. Our products are also very cost effective.

Are you looking for investment partners at the moment?

Our company is a family business that has been growing throughout the years and that holds the north and northeast market. Our brand is desired in these regions. We are looking for a partnership, so that we can be even stronger in terms of finance and management. With that we want to have a strong business plan to expand to the rest of the country: then we will have a giant market to explore.

Do you have any perspective about opening franchise stores in other countries?

Our expansion planning for the moment is still limited to the north and northeast region. We have 35 stores and we plan to open 8 more until the end of the year. Our goal is to reach 50 stores until the end of 2014. We are looking for a partnership in order to reach the entire country and only then we can start dreaming of higher aims and start looking into the expansion to other countries.

Which are the biggest challenges your company is facing at the moment?

Our biggest challenge is expansion because we need large investment, a bold and challenging planning and lots of knowledge. My dream is that our brand becomes a national brand. I’m certain we are on the right track.

What type of results would you like to obtain in 3 years from now?

I would like to get into the other regions, especially the southeast of the country, reaching a number of 100 stores.

What would be your message to foreign investors? Why should an investor come to Rio Grande do Norte and not to another Brazilian state?

Rio Grande do Norte is growing rapidly and a good project will receive all support possible and available in the state. Here you can also find good labor that – with a little bit of support and training – can be a valuable asset to any company. All investors coming into our state are very welcome.