brazil report 2007

In the food segment private labels are an important

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Unformatted text preview: which include finance, leisure, and travel, among others. Convenience stores Hybrid indigenous format Large retailers already understand the concept of convenience in the retail industry instead of a format retail option. Available statistics about convenience stores only cover the 3,100 odd stores located in gas stations, which represent around 0.4% of total sales in the Brazilian retail industry. However, the concept of convenience is a local reality through a wide range of hybrid formats that include outlets ranging from small independent supermarkets to bakeries. If the latter were considered as convenience stores, the format would show a different market-share. Pharmacy and drugstore chains are also highlighted as strategic convenience stores, as they are prepared to expand their activity adding more items of convenience. 18 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil Non-food retail channels Speciality stores Credit expansion has been an important driving force for revenue in 2005 for many of the non-food retailers in Brazil. Following the trend of creating partnership or similar associations with financial institutions, retailers have in fact received an injection of capital that has been used to expand operations, through the opening of new stores and the acquisition of small competitors. In addition, these partnerships have increased the number and amount of financed sales. From the financial institutions’ viewpoint, the partnership has been a quick way to obtain a mass of potential clients for other financial services, such as personal credit lines, insurance, credit cards among others. Major specialty stores Group name Store brands Store formats Number of stores Casas Bahia Casas Bahia Home equipment & furniture 500 Ponto Frio Home equipment & furniture 369 Lojas Pernambucanas Pernambucanas Department store 238 Lojas Riachuelo Riachuelo Department store 79 Magazine Luiza Magazine Luiza Home equipment & furniture 350 Insinuante Home equipment & furniture 150 Renner Department store 72 DPaschoal Tires & accessories 200 Colombo Home equipment & furniture 360 Drogaria São Paulo Drugs & Pharmacy 185 Ponto Frio Insinuante Lojas Renner DPaschoal Lojas Colombo Drogaria São Paulo Source: Gazeta Mercatil, Company’s websites The reduction of interest rates, combined with a potential increase in the purchasing power of the population as a result of the sustainable growth of the economy, have attracted financial investors interested in the retail sector, such as the Capital Group, which acquired a stake in Magazine Luiza. 19 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil The construction materials, home decoration and furnishing market has also expanded and chains like Leroy Merlin, C&C and Telhanorte have aggressive plans to increase the number of stores in the first and second tier cities, stimulated by the recovery of real estate growth and the increase in the number of apartments and residential housings. E-commerce According to analysts, e-retailing revenues in 2006 are expected to reach BRL14 billion, an increase of 41% over 2005. The largest internet retailer in Brazil, recorded revenues of BRL864.8 million in 2005, an increase of 99% over 2004....
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This document was uploaded on 02/14/2014 for the course MBA MBA at SPSU.

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