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Why is vinyl still expensive in Brazil? Understand what influences the price

Why is vinyl still expensive in Brazil? Understand what influences the price
Why is vinyl still expensive in Brazil? Understand what influences the price
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The vinyl market has grown in recent years, both in Brazil as in the world. However, the price of vinyl records is still considered high in the country, even with the popularization of the format. But why does this happen?

One of the main reasons for the high price of vinyl in Brazil is the lack of local production. Most discs are imported, which leads to high taxes and customs fees. Furthermore, the production cost of a vinyl record is higher than that of a CD or digital file, which also influences the final price.

Photo: Iudmila Chernetska / The Music Journal

Production costs

The high price of vinyl in the country is mainly due to production costs, which are influenced by several factors. Here, I will address the main costs involved in producing vinyl records.

Feedstock

The raw material used in the manufacture of vinyl records is polyvinyl chloride (PVC), a plastic derived from Petroleum. The price of PVC is influenced by the price of oil on the international market, which can make its import more expensive. Furthermore, PVC is a toxic material and its production requires special environmental care, which can increase its cost even more.

The production of vinyl records is a complex process that involves several steps, such as recording the songs on a master, The vinyl pressing and the cover printing. Each of these steps requires specialized equipment and qualified labor, which can make the production process more expensive.

Import of materials

Photo: Giovanny Gava / The Music Journal

Many of the equipment and inputs used in the production of vinyl records are not manufactured in Brazil and need to be imported. This can increase the final cost of the product, as imports are subject to taxes and customs fees. In addition exchange rate instability can make the even more expensive import.

In summary, the costs involved in the production of vinyl records in Brazil are influenced by several factors, such as oil prices, the environmental care required by PVC production, the complexity of the manufacturing process and the import of equipment and inputs. All of this contributes to the vinyl is still considered a luxury product in the country.

The vinyl market in Brazil is still a niche and therefore the disc supply is limitedThe. National production is low and most records are imported. Furthermore, the demand for vinyl has increased in recent yearswhich contributes to maintaining high prices.

Production costs are also a factor that influences the final price of the product. Vinyl production is a complex process and requires specific equipment and specialized labor. In Brazil, production costs are higher than in countries with a greater tradition in manufacturing vinyl records, which contributes to the final price of the product.

Brazilian consumer profile

Photo: Disclosure / The Music Journal

The profile of the Brazilian vinyl consumer is diverse, but in general, they are people who value sound quality and the experience of listening to a vinyl record. Collectors are an important audience for this market, but they also there is a growing number of people who are discovering the format and starting to buy records.

High prices may be a deterrent for some consumers, but many are willing to pay more for a quality product. Furthermore, vinyl is seen as a collector’s object and many people are willing to invest in their record collection.

In short, the Brazilian vinyl market is still small and supply is limited, which contributes to high prices. However, demand for vinyl has increased in recent years and the consumer profile is diverse, which indicates that the market can continue to grow.

National tax burden

Brazil is known for having one of the highest tax burdens in the world. According to Brazilian Institute of Planning and Taxation (IBPT), the Brazilian tax burden in 2023 was 35.07% of Gross Domestic Product (GDP). This high tax burden directly affects the price of products, including vinyl.

Taxes on the production and sale of vinyl records may vary depending on the state in which the sale takes place. In São Paulofor example, the ICMS (Tax on Circulation of Goods and Services) is 18%while in other states it can reach 20%. In addition, there is also the incidence of federal taxes, such as PIS and the COFINSwhich can reach 9.25%.

Distribution costs

Distribution costs also contribute to the high price of vinyl in Brazil. The lack of competition between transport companies and the high tax burden on fuel and spare parts increase transport costs. Furthermore, the lack of tax incentives for companies that invest in logistics and transport also discourages infrastructure improvements.

In summary, vinyl logistics and distribution in the country face significant challenges that directly affect the final price of the product. The solution to this issue involves infrastructure investments, tax incentives It is improvement of logistics and distribution processes.

Vinyl market trends

The vinyl market in Brazil has shown significant growth in recent years. According to data from Pro-Musica Brasilvinyl sales in the country grew by around 30% in 2023 compared to the previous year. This increase can be attributed, in part, to consumers’ growing interest in the analog format and the superior sound quality offered by vinyl records.

Furthermore, the growing popularity of vinyl has attracted the attention of large companies in the technology and entertainment sectoro, who have invested in initiatives to revitalize the market. For example, the Amazon recently launched a service vinyl signature, which allows subscribers to receive selected vinyl records monthly. The record company Universal Music Brasil also has a robust online store with many titles available on vinyl, in addition to Vinyl Clubwhere the consumer can subscribe to receive the cookies at home.

Although the vinyl market in Brazil still faces significant challenges, market trends and emerging technological innovations indicate a promising future for the analog format.

The article is in Portuguese

Tags: vinyl expensive Brazil Understand influences price

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