Managing Director, Advantage Group Brasil, Ana Fioratti interviews CEO, Cencosud Brasil, Sebastian Los, on how the retailer has adapted its business strategy and approach to collaborating with manufacturers amid the pandemic.
Q: What are the greatest challenges that Cencosud faced during the pandemic?
A: The main challenge was to take care of the health of our team and clients. Our top priority was to implement this in a practical and effective way.
Q: What changes do you expect in the retail business after the crisis? Which trends and changes do you expect in the market?
A: The experimentation of different channels that shoppers have been doing for some time tends to stabilize or even reduce, consolidating the one-stop-shop concept. I think that in the future, consumers will prefer the value propositions based on quality and companies/brands that guarantee safety.
Retailers and manufacturers are working on a better understanding of future demand, especially where past performance does not provide a reliable base.Sebastian Los, CEO of Cencosud Brazil
Q: How did Cencosud Brasil improve/change its collaboration efforts with its suppliers during the pandemic? What behaviour has been more valuable during the crisis, and what are your expectations for the evolution of collaboration?
A: We basically increased the frequency of virtual meetings, with more objective agendas, focusing on the issues that needed to be resolved, especially ensuring product availability in our stores. I expect increased collaboration and a sense of urgency from both sides.
Q: What are the differences in the challenges of the banners and retail formats that Cencosud Brasil operates (Bretas, GBarbosa, Mercantil Rodrigues, Perini e Prezunic)? Are consumers loyal to the stores?
A: The challenges differ mostly based on the geography where each company operates. We identify and adopt a value proposition for each banner according to the profile of its clients, based mostly on the social and cultural aspects of each region. The back office is totally integrated with operations, especially in regard to support systems.
We have been getting very positive feedback from our clients, especially emphasizing the protocols we implemented at the beginning of the pandemic. We did it without cost constraints, with the sole objective to ensure safety for our employees and clients.
Q: How did the increase in e-commerce impact the FMCG industry in Brasil? How are manufacturers and retailers managing the growth of the online business?
A: The growth of online-only accelerated a trend we all knew that would happen. It was not a surprise. Retailers and manufacturers are working on a better understanding of future demand, especially where past performance does not provide a reliable base. It is increasingly necessary to align data and work collaboratively in order to test the new limits, and to quickly adjust any issue that arises. It’s an ongoing learning process.