The economic crisis has been a disaster for most of Argentina's mixed retailers, although it has represented an opportunity for others. This is evident in the fact that only two department stores chains operate in the country. Increased demand for cheap products has enabled the Mexican chain Coppel to continue its expansion in the country, with the opening of two new branches in 2016 as Coppel reached 18 branches in total in the country at the end of the review period. Except for one outlet in the City of Buenos Aires, Coppel focuses its outlet network on Greater Buenos Aires, particularly in areas with a preponderance of consumers with moderate and low purchasing power. It should be noted that the Mexican chain focuses exclusively on low-income consumers in Argentina. Although Coppel’s main rival, Chilean department stores chain Falabella, is executing plans to expand in other countries, the unfavourable investment landscape in Argentina discouraged it from opening new stores in the country in 2016.
Falabella Argentina SA led mixed retailers in 2016 with ARS6.8 billion in value sales and a value share of 61%. This company is of Chilean origin and it entered in Argentina in 1993 with its first department store in the province of Mendoza; at the end of the review period, the company had 11 department stores in Argentina. Falabella can attribute its strong position in Argentina to the wide variety of products it offers as well as its regular use of price discounts, not to mention its CRM credit card, which offers exclusive discounts to cardholders.
The recovery of Argentina's economy and the improved context for investment is set to be fundamental to the development of mixed retailers during the forecast period, particularly department stores. Given the expectation that the economic scenario in the country will become more favourable during the forecast period, it is likely that Falabella will decide to expand the number of department stores that it operates in the country, while Coppel may even expand at a faster pace than what was seen from the retailer during the review period.
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