Analyzing the offerings of a supermarket, department store or convenience store and examining what type of consumers frequent those establishments is key to establishing which chains a company's products should be present in to increase their profitability.
By analyzing large volumes of data, it is possible to combine information on the products that commercial establishments sell with details of the types of consumers that are attracted to the different chains.
Finding out how many people live in the surroundings of the establishment, their income levels, their ages and their tastes and interests, is fundamental information to measure the potential of a supermarket's location.
Using the Geomarketing solutions we have developed for our clients, CentralAmericaData's Business Intelligence team analyzed the environment of some of the main supermarket locations operating in Central American countries. Below is an excerpt of the study's findings.
One of the sales points of the AM PM convenience store chain in Costa Rica, is located in the surroundings of Parque La Sabana, it has a potential market of 254 thousand consumers 15 minutes away by car, and 24% of them are interested in fast food.
Using the Geomarketing solutions we have developed for our clients, CentralAmericaData's Trade Intelligence team analyzed the environment of some of the main locations of convenience stores operating in Central American countries. Below is an extract of the findings of the study.
Given the gradual return to physical stores, customers will appreciate it if businesses disinfect stores several times a day, if other visitors are required to clean their hands before entering, and if employees use protective equipment at all times.
Although in this context of the spread of covid-19, digital channels have gained ground in Central American markets and this trend is expected to continue in the coming months and years, there are commercial establishments that will have to adjust their face-to-face sales strategy to the demands of the new normality, since there will always be customers who prefer to continue shopping in person.
Reaching consumers in a confined scenario has been a complex task for companies distributing mass consumption products, since the operation of some of the commercial channels has been limited in the region's markets.
In Panama, companies engaged in the wholesale distribution of food products such as oats, beverages, snacks and others have faced challenges during the weeks of home quarantine, which was decreed by the authorities following the outbreak of covid-19.
In April, the Walmart chain invested nearly $8.5 million in the construction and opening of four new stores in Costa Rica.
The company reported that three sales points operate under the Pali format and are located in Ipis de Goicoechea, Guayabo de Bagaces and Dulce Nombre de Cartago. The other establishment operates under the brand Maxi Pali and is located in Los Guido, Desamparados.
Between February 2020 and Easter Week, visits to shops decreased between 40% and 90% in Central American countries, but since April 13 a change in the trend has been observed, reflecting a greater movement of people to shops and other businesses.
According to the "Information System for the Impact Analysis of Covid-19 on Business", prepared by the Trade Intelligence Unit of CentralAmericaData, Costa Rica is the country with the most pronounced change in trend, since as of April 12th the reported drop in physical visits to stores was 79%, while on April 17th the reported reduction was 57% from the levels prior to the health crisis.
The restrictions on mobility decreed in the region open up new opportunities for sales points such as small self-service shops, grocery stores and corner shops, which can make use of home delivery service schemes to boost their sales in this context.
In the current context of health crisis, large supermarket chains have implemented safety and hygiene protocols, which force consumers to assume long waiting times to do their shopping.
In Costa Rica, Inversiones AM PM announced that it plans to open four new convenience stores before the end of 2019.
Representatives of Inversiones AM PM, owner of the AM PM and Fresh Market stores, explained that the store that is closest to being inaugurated is the one that will be located in Guayabos, Curridabat.
Automercado has inaugurated a new point of sale in Guadalupe, San José, and next year it plans to build another in Curridabat, in the east of the capital.
The supermarket which opened its doors in Guadeloupe, required an investment of $1 million, and is the 21st point of sale of the chain Automercado.Representatives explained that "...This is the second supermarket inaugurated under this brand name in the course of 2017 (another opened in Santo Domingo de Heredia last January), thus fulfilling the number of openings planned in the expansion plan from 2016 to 2024."
In the last five years in Costa Rica the number of these types of outlets has increased by over 30%, and companies in the sector project continued growth in the medium term.
Sales at the 141 convenience stores operating in the country, according to figures from Euromonitor as reported by Nacion.com, have also grown significantly in the last 5 years, going from $44 million in 2010 to $178 million in 2015.
On October 1st and 2nd Central American entrepreneurs in the manufacturing sector in Guatemala will be meeting with international buyers from supermarkets, convenience centers, importers and distributors.
Taken from the official website of the event, Manufexport.com.gt:
The Guatemalan Exporters Association AGEXPORT presents MANUFEXPORT Special Edition 2014 Retail Supply Expo, an event designed to promote greater competitiveness of the manufacturing sector in Central America and expand business opportunities internationally.
The dynamism and growth of the past two years is being maintained with the arrival of new competitors in a market which already totals 143 outlets in the Greater Metropolitan Area of Costa Rica.
Added to well-known brands such as Fresh Market, AM PM and Vindi, all using the convenience store format, there are now local bakeries from the Musmanni chain, branded Musmanni Super Mini, owned by Florida Ice and Farm.
Networks of convenience stores are extending throughout Costa Rica and, at least for now, coexist with small retail outlets without affecting them too much.
The main reason for this peaceful co-existence is that the market segments that both types of commerce address are different.
Elfinancierocr.com reports that "retail stores such as grocery stores, corner shops and bakeries, cling to their low prices and the tradition factor in order to face off the strong growth of chains of convenience stores over the past two years."