Discounters in Mexico

PROSPECTS

Discounters overtakes hypermarkets in terms of value sales

Discounters maintained dynamic current value growth in 2019, seeing the second highest increase within grocery retailers, although the growth rate was slightly slower than in the previous year. Nevertheless, discounters became the leading channel within modern grocery retailers in Mexico in terms in value sales in 2019, taking this position from hypermarkets.

Despite challenges, discounters is expected to see strong growth

There was a growing trend over the last few years of a group of wholesalers, mayoristas, increasingly targeting consumers. Scorpion and Zorro Mayorista remodelled their stores to be more consumer-friendly, invested in e-commerce and launched promotions and advertisements typical of modern grocery retailers.

More players focus on profitability rather than new outlet openings

As in other modern grocery channels, there were just a few players that saw strong outlet growth in discounters in 2018 and 2019. These included the various formats of Bodega Aurrera, Tiendas 3B, and the smaller player Super Chedraui.

COMPETITIVE LANDSCAPE

Wal-Mart de México continues to develop Bodega Aurrera

Wal-Mart de México became the dominant player in discounters in Mexico after it acquired the Mexican retailer Aurrera in 2000, and maintained the lead in value terms in 2019. The brand has positioned itself amongst Mexican consumers as the strongest competitor within discounters with three brand concepts – Bodega Aurrera, Mi Bodega Aurrera and Bodega Aurrera Express, which accounted for more than half of value sales in discounters in 2019, although it saw a slight share decline in this year.

Tiendas 3B aims to approach the leading retail brands in discounters

In 2019, Tiendas 3B saw the fastest growth in terms of number of outlets and value sales within discounters, and saw another year of share increases. It is opening stores not just in low-income areas, but also middle-income areas.

Private label lines are heavily promoted and becoming increasingly popular

Private label lines are being heavily promoted by discounters. The perception of the private label brands available in discounters is starting to evolve.

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