“It is possible that by the end of the year local companies will recover some of the accumulated losses” – Algomais Magazine
Bernardo Peixoto, president of the Fecomércio/Sesc/Senac-PE system, analyzes the continuation of the trade, services and tourism sectors after the impact of the pandemic. It also assesses the impact of inflation and high interest rate scenarios and the outlook for the hotel sector in Serinhaém, where Sesc will open a hotel later this year.
During the pandemic, major transformations were recorded in retail, services and tourism. Some of them, such as the growth of e-commerce sales, will remain there, according to the analysis of Bernard Peixot, president of the Fecomércio/Sesc/Senac-PE system. Other changes, which were previously understood as trends, did not remain in this period when Covid-19 cooled down. This is the case of consumers who join the so-called proximity retail, also known as a neighborhood store. “With the general increase in prices, cash registers and sales points are strengthening”, says Bernardo Peixoto who, faced with the scenario of unemployment, inflation and high interest rates, believes in a partial recovery, this year, of trade losses accumulated in 2022
In this interview with Cláudia Santos, the president of Fecomércio also referred to the resumption of services – especially due to the return of touristic, educational, concert and event activities. In tourism, including, the opening of the Hotel do Sesc on Gauadalupe Beach, in Sirinhaém, is expected this year, a business that, according to Bernard Peixot, should attract new investment to the region.
E-commerce has grown a lot in the pandemic. Is he here to stay or has he retired at this point? Is logistics a bottleneck?
E-commerce in Brazil was already showing a trend of expansion before the pandemic, but at a pace that was still very slow compared to world standards, especially compared to Brazil’s important trading partners, such as the United States and China. The shutdown of face-to-face activities during the health crisis eventually helped speed consumer online presence to a standard that was only expected at the end of the decade.
Given this recent progress, it’s safe to say that e-commerce will continue even after the pandemic. Brazil is a promising market for small and large e-commerce players. In Pernambuco we also have this vision and the state, due to its privileged position, attracts the logistics operations of large companies in the segment.
The second half usually shows an increase in retail sales. Will that happen again this year, or could inflation and interest rates be an obstacle to a more sustainable recovery?
In fact, there is always an expectation that the second half of the year will be warmer and that this will help to overcome any difficulties, in terms of sales, at the beginning of the year. But what is already noticeable, as of 2018, is a very low result of retail sales in the country, even with sales heating up in the second half of the year. The fact is that the success of the local labor market no longer contributed to this, and the national economic situation, with inflation, acceleration and increase in interest rates, puts additional weight on the purchasing power of families from Pernambuco. A reflection of this can be seen in the research on retail sales: according to IBGE, sales in the country accumulated a decline of 5.3% until July, compared to the previous year, and in July 2021, this result was positive for 10.2%. Despite this, it is possible that by the end of the year, the domestic economy will compensate part of the accumulated losses, since the formal labor market has been performing well since May.
What are the prospects for shopping centers and street trade?
Shopping centers are gaining more and more supporters at the time of shopping, in different income classes. This is because consumers have recognized the advantage of being able to shop in a controlled environment, with security, where they can use the moment of purchase to access a service. These factors boosted spending in shopping centers after reopening. To give you an idea, according to the Brazilian Association of Shopping Centers, sales in shopping centers increased by 38% in the second quarter compared to the same period in 2021 and 4.3% compared to the same period in 2019. Practical price research, without high volume, yet is one factor that can influence consumer behavior. High street retail is still attractive, but the fact is that in the coming years it will increasingly share consumer preferences, with competition from shopping centers and e-commerce.
Has the pandemic encouraged consumers to shop in neighborhood stores, close to where they live?
Before the pandemic, stores in the neighborhood store, the so-called proximity retail, were already a growing trend. The pandemic briefly helped to reduce the demand for this business format, especially in the food products segment. But currently, with the general rise in prices, wholesalers and outlets are getting stronger. In these areas, the consumer sees an opportunity to continue consuming some items at a price below the market average.
Read the entire interview in issue 198.5: sign.algomais.com