brazilian retail news 399, august 9th
TRANSCRIPT
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8/6/2019 Brazilian Retail News 399, August 9th
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Brazilian Retail NewsYear 10 - Issue # 398 - So Paulo, August, 08h, 2011
Phone: (5511) 3405-6666
BRAZILIAN RETAIL NEWS 108/08/2011
US coffeehouse chain Starbucks said Brazilhas potential to host at least 1,000 stores and, so,
the company will increase its investments in the
country. Today, Starbucks has only 26 stores in
Brazil, in So Paulo, Rio de Janeiro and Campinas
cities. Recently, CEO Howard Schultz said Brazil
will be a significant engine for the companys
worldwide growth.
Car sales goes over 2 million on year
The automotive industry has gone beyond 2 million cars sold this year, about 8% more than in the
first seven months last year. The sales, however, have been driven by special sales to fleets and car
rental companies, while retail sales have been lagging behind.
Po de Acar changes drugstore mix and sales soar more than 50%
Grupo Po de Acar, Brazils top retailer,
started a broad restructuring of its drugstore
business. The company has increased the sales
area of the shops and strengthened the assortment
of perfumery and beauty care categories. In a pilot
project in five stores of the chain, sales rose more
than 50%. The changes will be rolled-out to the
companys 152 shops in the next two years.
Starbucks to open 1,000 shops in Brazil
Rio de Janeiro will host first Ferrari Store in Latin America
Via Italia group will open later this year in Rio
de Janeiro the first Ferrari Store in Latin America.
The shop will present the entire portfolio of the
brands licensed goods, mainly clothing and
accessories. Today, Ferrari Store chain has 45
shops worldwide, in South Africa, Germany,
Andorra, Saudi Arabia, China, UAE, Spain, theUSA, Greece, Italy, the UK, Romania, Singapore
and Ukraine.
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Brazilian Retail NewsYear 10 - Issue # 398 - So Paulo, August, 08h, 2011
Phone: (5511) 3405-6666
BRAZILIAN RETAIL NEWS 208/08/2011
Carrefour changes stores to Atacado brand
To attract lower income consumers, Carrefour,
Brazils second-largest retailer, started changing
hypermarkets to Atacado cash & carry format.
Cities as Novo Hamburgo, Porto Alegre, Niteri
and Franca have already opened refurbished
stores. Carrefour has not informed how many
store will be revamped, but analysts say the move
will double Atacado stores today, there are 72
shops in 21 states.
Gucci prepares expansion in Brazil
Almost three years after opening its first store in Brazil, Italian luxury brand Gucci prepares its
expansion. The company had only one shop in the country, at Iguatemi So Paulo mall, but recently
opened another one, at Iguatemi Brasilia mall. Until December, Shopping Cidade Jardim, in So
Paulo, will receive a store, and in March, 2012, JK Iguatemi mall, also in So Paulo, will present the
first male Gucci shop in the world.
Raia Drogasil will keep its two brands running
The Drogasil / Droga Raia merger, who created the countrys largest drugstore chain, with more
than 700 stores and an 8.3% market share, shall not lead to the death of one of the brands. Much on
the opposite: the two brands will remain active, with clearly defined identities. The two chains already
had complementary profiles, Drogasil focusing a more senior consumer profile and Droga Raia on
women. Geographically, Droga Raia has been expanding to the South, while Drogasil has been growing
in the Midwest.
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Brazilian Retail NewsYear 10 - Issue # 398 - So Paulo, August, 08h, 2011
Phone: (5511) 3405-6666
BRAZILIAN RETAIL NEWS 308/08/2011
Market consolidation: growing and irreversible
Marcos Gouva de Souza ([email protected]), CEO, GS&MD Gouva de Souza
Momentum
The merger of Drogasil and Droga Raia drugstore chains is just another chapter in a growing and irreversible market
consolidation process, driven by the increasing competition. And mirrors a global process that relates the maturity of countries
and consumers to the market consolidation.
The drugstore segment, with more than 65,000 stores, is one of the most fragmented in Brazil. Its consolidation only started
recently, when some players, including Drogasil, decided to use acquisitions to grow faster. At the same time, financial groups, as
BTG Pactual, understanding the Market fragmentation didnt make sense in the long term, also started investing in acquisitions
and market consolidation.
The new company formed by Drogasil / Droga Raia will own around 8.3% of the Brazilian market and the example will surely
be followed by others, becoming logical in ten years the scenario will be completely different from today, with the top five chains
accounting for 40% to 50% of the market, as already happens in other segments, as supermarkets and electronics.
As it happens in the most developed markets, where consolidation meets maturity. In Germany, France, Spain and the United
Kingdom, the share of the top five supermarketers in the total sales of the segment ranges from 57% to 61%.
But this process is not present in the distribution and is even stronger in the industry. And Brazil is a great example of this.
From 2005 to 2010, the share of the top five toothpaste brands rose from 89% to 95%. In the roasted coffee market, from 27%
to 32%. In the soft drink segment, the top five share rose from 51% to 56% and in the filled wafer category, from 35% to 42%.
Its a no-return path, that needs to be followed, monitored and managed, but cant be avoided.
The recent antitrust authority decision regarding BRFoods, imposing restrictions and forcing the sale of brands and businesses
so the Sadia/Perdigo merger could be approved will not, in the long term, hinder a significant growth of the companys brands,
due to strategic, operating and management efficiency resulting from the business integration. It happened in the past and will
continue to be.
One of the few exception cases in Brazil come from the automotive sector, in which the market share of the top five companies
has dropped, as these companies in the past, taking advantage of a closed market, for many years were sovereign, imposing
prices and conditions. With the market opening and global offer, a new reality has created, with more brands, models, products
and services. Competition is wise to create innovation.
In the most developed and mature markets, in the most important industry and distribution segments, the top five players
usually own more than 40% of the market, threshold of consolidation level. In the emerging countries, as China, India, Russia,
Turkey and South Africa, as in the industry as in brands and distribution, the consolidation level is low and the mature of these
markets will bring, as a logical consequence, increasing consolidation. And this is the main reason for the foreign investments
already being made.
In the Brazilian case, a country that can be considered as develoging, as is already developed in many sectors and still
emerging in many others, the consolidation of markets and segments will be increasing and irreversible, as a natural result
of the more efficient action of some groups; broader view and ambition; more disposition to assume risks; better access to
financial resources; and more commitment and belief in the long term.
Brazilian Retail News (BRN) is a weekly newsletter published by GS&MD - Gouva de Souza with the most important news
on the Brazilian retailing. The content can be freely used, once the source is quoted. If you want any information on BRN or ourservices, please send an email to [email protected] or access GS&MD - Gouva de Souza at www.gsmd.com.br.
Gouva de Souza & MD Desenvolvimento Empresarial Ltda.
Av. Paulista, 171 - 10 floor
Paraso So Paulo Brazil Zip Code: 01311-904
Phone: (5511) 3405-6666 Fax: (5511) 3263-0066