Retailing continues to grow but at a slower pace
In 2013, retailing continued to show healthy sales growth, mainly driven by internet retailing and drugstores/parapharmacies, beauty specialist retailers and electronics and appliance specialist retailers. In grocery retailers, discounters, convenience stores and forecourt retailers recorded above-average retail value sales growth in the industry and strong increases in the number of stores. Despite the onset of an economic slowdown in 2013, the consumption of the population remained high, especially among the new middle class, whose purchasing power was stimulated by higher disposable incomes.
High inflation penalises food products
The inflation rate in 2013 worried consumers as well as companies and the government. Despite a general impact on sales across retailing channels, grocery retailers were most affected by price increases caused by rising inflation. Fresh food like fruits and vegetables carried high prices, which worried consumers, since basic food basket items, such as, tomatoes, witnessed very high increases. This reduced the consumption of fruits and vegetables.
Non-grocery products gain space in supermarkets
In the largest cities of Brazil, the trend of buying food in convenience stores and small grocery retailers, such as traditional neighbourhood markets, remains strong, as consumers increasingly seek convenience and practicality. Thus, they frequent smaller stores close to home or work, which offer a mix of fresh and packaged food to meet the consumption needs of one day or week at most. Thus, the share of grocery sales in large stores like hypermarkets slowed while the share of non-grocery products increased. Supermarkets offer a varied mix of non-grocery products, from consumer electronics and appliances to home and garden products and toys, among many others, as a way to offset the pressure on food sales.
Multichannel strategies stoke competition in retailing
The competitive landscape has grown and competition has become more aggressive between the various players in Brazilian retailing. This is explained by the development of multichannel strategies, which see retailers present in various sales channels, from the traditional brick-and-mortar stores to internet retailing and even direct selling. Retailers are keen to use all possible strategies to attract the attention of customers.
The future of retailing remains optimistic
Despite the onset of economic slowdown in 2013, it is expected that retailing in Brazil will continue to develop positively during the forecast period. Retailing will receive a boost from the country’s hosting of the FIFA World Cup in 2014 and the Olympic Games in 2016. Moreover, the expansion of a new middle class will boost retail development and growth.
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The Retailing in Brazil market research report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic number of stores, selling space and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- How big is the grocery/non-grocery/non-store channel in Brazil?
- Who are the leading retailers in Brazil?
- How is retailing performing in Brazil?
- What is the retailing environment like in Brazil?
- Which channels are winning or losing in the fight for consumers’ money?
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- Inform your marketing, brand, strategy and market development, sales and supply functions
This industry report originates from Passport, our Retailing market research database.