The PIE: It’s been quite a while since we last spoke. Could you remind us what CI Brazil does for students in Brazil?
Victor Hugo Baseggio: While we are still involved in the travel portion of the student journey, we’re more focused on international education. With the internet and the development of distribution, especially for travel services, we geared most of our efforts toward that. We’ve also always been very active in trying to search for more options.
In the early days, the traditional language program was the big thing, but we never gave up in terms of trying to look for different options, and also to serve the students from as early as the age of 10. I think we had a few students at the age of eight, but I would say that nowadays we mostly start around 12, and then we try to serve them all the way into university. The teen and university programs really have been the stars of these times for us.
The PIE: How has Covid-19 impacted your business?
VHB: There hasn’t been an event like this in the 30 years we’ve been in business – I think it’s had a tremendous impact in the sense that we didn’t know when it was going to end. We’ve been adjusting the normality of things, you know, but normal never came. We weren’t sure whether it was going to be three months, or 12 months. But we understood that the world was going to change, and so after lockdown started on March 20 – as early as April – we really streamlined our operation. We made two big cuts in terms of stores and of course, employees. I would say that we cut down our general operation by about 25 stores and in terms of people, we are around 55-60% less now than we were before the pandemic.
“There hasn’t been an event like this in the 30 years we’ve been in business”
The PIE: Were you getting any kind of assistance from the federal or state government?
VHB: No, because we also have operation overseas, with offices in New Zealand, Australia, Ireland and Canada. We were really surprised to see such generous subsidies from these governments in developed countries. We had absolutely no help from ours; the only thing they allowed us to do was reduce the working hours up to 75%, and reduce wages.
At the same time, for every month of wage reduction, you add an extra month of obligation to keep the employees. So, for six months guaranteed employment, you have to add another six until the situation goes back to normal. Having guaranteed employees for that long in the private sector is just unimaginable. We also had direct negotiations with landlords, unlike in Canada, for instance, where rent relief was high. Brazil doesn’t have extra resources, and although they gave handouts to the state governments, the help for the private sector was absolutely zero. With that, and the devaluation of our currency, we had to scale down because it became, say, 40% more expensive for Brazilians to travel and to afford our options.
The PIE: We’re starting to come out the other side of the pandemic; what are your operations like at the moment?
VHB: Well, when you have a very strong brand, in difficult times you get more customers organically and so fortunately, demand has always been good for our programs. We realised that there would still be a reduction in terms of customers being able to afford it, because of the very strong currency devaluation. We’ve also been dealing with issues in the international consulates not operating properly, which was something that we didn’t expect. We were shocked at how long they didn’t issue visas for foreign students. Fortunately, the US, Canada and to some extent UK gave some priority to students in the past few months, but overall, we see this being key to us going back to normal.
“When you have a very strong brand, in difficult times you get more customers organically… demand has always been good”
The PIE: Where are you seeing students wanting to go now?
VHB: It’s funny, because we thought Trump would have a negative impact on US interest, but these days America seems to be back as a top destination, and has maybe conquered the hearts of Brazilians more rapidly than we thought – especially when Trump was leaving office. Canada, of course, remains our number one destination, despite the persisting visa issues; certain cities in Brazil don’t have their own consulates to issue visas. They put in a lot of effort, and it’s difficult to balance as it’s sometimes hard for a consulate to adjust to demand. We had some students travel in August/September, but logistics have been an issue with Air Canada was not operating in Brazil until early September. Some had to fly through odd connections; others couldn’t travel on US carriers due to visa issues. The air fare was the highest we’ve ever seen for our Canadian destinations.
The PIE: What would you say is the biggest change in the climate, apart from Covid, that you’ve had to adapt to over the years?
VHB: The digital development. Having a good digital presence absolutely determines our success. At the same time, international education for Brazilians is a big investment, and we’re not yet in a situation where students buy their programs 100% online. You have to be online, but because of the investment involved, I still believe that the physical presence is very important, particularly for the teen programs – it’s very hard to do it all without it.
I think with the language programs, there is an option to go further into the online sphere. And our local offices are now half of what they were. More and more of our staff are working from anywhere, rather than having to be at the office. I think that hybrid working will definitely be adequate for what we need to do and to serve our customers.
“CI is going to be more flexible, more agile, quicker to react and to adjust”
The PIE: What’s next for CI?
VHB: I always say that if you are an entrepreneur, you have to be optimistic all the time. And thank God! Through the pandemic I lost quite a few nights of sleep, even worried about the students that were away from home. I was always concerned about our employees, our franchisees, the whole network, and what the future is going to bring. The whole chain of international litigation has been impacted. We were seeing some of our suppliers going through very, very hard times, some more than others, so we were terribly concerned for quite some time. But I’m very happy to say that I never lost the sense of optimism about the future. I think that what we do and what we add to the lives of our prospects and our students is phenomenal. So together with the optimism, we are adjusting.
After the pandemic, CI is going to be more flexible, more agile, quicker to react and to adjust. We did enormously well in terms of improving our system-wide operations. We put together new solutions for our stores, back offices and finance. It was a huge leap forward for us, because of the legacy you bear when you are a company as old as ours. I think that we could have excellent years ahead of us. I don’t doubt that 2022 could become possibly the best year of our history, financially speaking, because I think the demand is there. And once the flow is allowed to restart for international students, I think that Brazilians are very willing to go back to the destinations promoted by CI.