While 2020 saw the leading players in variety stores struggle to generate sales growth during the pandemic, 2021 was similar as various restrictions in place limited their ability to operate profitably. Among the main factors placing pressure on players in 2020 was the requirement for all variety stores to remain closed for several weeks during Q2 as this channel fell outside of the official designation of “essential businesses”.
The digital strategies of the leading players in variety stores were already under development prior to the onset of the pandemic and continued in 2021, despite the gradual easing of restrictions. However, these digital strategies gained further traction as the challenges that unfolded, specifically in terms of the ability to attract customers back to stores, brought home to retailers the importance of being able to target consumers in their own homes.
The most notable background trend to have emerged from the pandemic has been the negative impact on the wider Brazilian economy. Indeed, the response to COVID-19 caused significant disruption to commercial activity in key sectors of the Brazilian economy throughout 2020 and in early 2021, when daily death tolls reached their peak in the country with over 4,000 per day.
Digital payment methods are expected to continue emerging as a key element of the shift towards online engagement in Brazil’s retailing industry during the forecast period. Indeed, with huge numbers of Brazilians still experiencing low levels of engagement with the financial services system, it offers fertile ground for the development of digital payment systems that enable consumers who do not have bank accounts or who have no access to credit to complete payments for online orders.
One of the more unfortunate outcomes of the pandemic on Brazil’s chained variety stores has been the negative impact that the substantial declines in revenues registered over the course of 2020 and early 2021 have had on their outlet expansion programmes. Leading player Americanas has for several years been engaged in an ambitious programme to extend its reach to numerous key states.
The adverse economic environment and low consumer confidence that have unfolded since the emergence of COVID-19 are likely to remain relevant, with expectations of a substantial recovery for both likely to take time. Amidst such an unfavourable scenario, leading player Americanas partnered with retail bank Banco do Brasil to launch credit card Ame BB through the former’s digital wallet Ame Digital.
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Understand the latest market trends and future growth opportunities for the Variety Stores industry in Brazil with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Variety stores are chained or independent retail outlets with a primary focus on selling a range of merchandise across several categories. Variety stores are chained or independent retail outlets with a primary focus on selling a range of merchandise across several categories, although they may also sell grocery items. Includes fixed-price stores (e.g. dollar stores) and catalogue showrooms. Example brands include Dollar General, Woolworth (Germany), and Miniso.See All of Our Definitions
This report originates from Passport, our Variety Stores research and analysis database.
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