Vending in Brazil

2021 DEVELOPMENTS

Vending as a way to diversify retailers’ omnichannel strategies

One of the factors that supported low declines for vending in Brazil compared to some channels in 2020 and was reflected in its more positive performance in 2021 was the decision by various vending companies to diversify the range of products they offer in their machines, with a focus on products consumers started to purchase more frequently during the pandemic. Therefore, many vending machines began to offer hand sanitiser and disposable face masks as soon as the presence of COVID-19 in Brazil was announced.

Easing of restrictions contributes to mild recovery for vending

The main factor suppressing sales growth in vending in 2020 was the strict adherence to the principles of social distancing and home seclusion by the Brazilian population since the pandemic emerged in Brazil in the April. This meant fewer people circulating in the streets and spending time in public places, resulting in a significant diminishment of the potential consumer base for vending as lockdown restrictions formed a central element of Brazil’s strategy to contain the spread of the virus.

Electronic modes of payment to help position vending as contact-free retail channel

While the general scenario was unfavourable for vending in Brazil in the early days of the pandemic, the channel did benefit from the fact that using a vending machine reduces the need to come into personal contact with another person. Therefore, vending sales enjoyed a gradual recovery from late 2020 and throughout 2021, with shopping via a vending machine widely seen as a convenient and easy way to comply with social distancing protocols.

PROSPECTS AND OPPORTUNITIES

Diversification of vending operations is key

In terms of the more traditional types of products that are typically associated with vending machines in Brazil, specifically packaged food and packaged drinks, healthy options are expected to become increasingly relevant. This addresses the health and wellness trend that has seen a general shift towards healthy lifestyles amongst the local population in recent years and which has gained traction amongst Brazilians seeking healthier drinks and snacks for consumption on-the-go.

Digital payments to take the place of classic coins

In addition to paying by using points from loyalty programmes, the generation of dynamic QR codes in vending machines to enable customers to perform electronic payments is expected to continue being utilised over the forecast period. The reasons behind this are twofold.

Increasing Brazilians’ exposure to vending machines is on players’ radars

Vending is expected to register dynamic growth over the forecast period due to an expectation of recovery after a decline caused by social distancing measures during the pandemic, but it will also be attributed to the expansion that is anticipated in the range of locations in which vending machines are situated. Franchising is likely to prove another key strategy in the development of vending, with the owners of vending machines likely to offer their operating franchisees the freedom to choose the locations for their machines and also to change their locations as and when they deem necessary.