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Will American consumers prefer private labels as Europeans do?

June 25, 2009

Analysis of:Is Wal-Mart onto something? | www.homechannelnews.com

People in Europe prefer private labels for different products, as retailers can offer them with their own brands, better deals eliminating several merchandising expenses. Some people think that it is better to buy a product, that a prestigious retailer has approved (and supported with their brands), getting more quality for a lower price, instead of a brand that has been top of the market because of it’s spends in advertising, that finally raises the price, without a perceived benefit for consumers. How can this work in Walmart?

How does a legal problem between Pepsico and PBG would affect the sales on trade and the probable value of the companies?

May 12, 2009

Analysis of:PepsiCo Sues to Void Pepsi Bottling’s ‘Poison Pill’ | www.bloomberg.com

Is the legal problem an issue to intensify the normal differences that are always present among the interests of the owner of the brands and the bottlers? How can you be fighting with your partner and expect him to be loyal to you and your interests?   Pepsico has declared that the acquisition will provide the opportunity to get synergies for savings between 400 million and 800 million. But is it really possible? Are they considering extra expenses they will need to make in IT or improvements in operations?   How will this operation affect relationships with Dr Pepper Snapple Group, Coca Cola or some other agreements they already have?

The Hispanic Market in America, does not behave as it does in their countries

March 19, 2009

Analysis of:Wal-Mart to open supermarkets targeting Hispanics | www.marketwatch.com

Several supermarket chains from Mexico have experienced bad incursions into the US, trying to reach the Mexican customers that live there. Something that they have learnt is that the customers do not shop as they do in their original environment in their country. Gigante and Liverpool (the biggest department store in Mexico) are two very good examples of failures, trying to reach that market. There are several things that have to be brought in consideration before managing the market in the same way they do in Mexico. Small independent stores as “The Gonzalez Northgate Market”, “The Metate Market” and “El Super” – The Chedraui brand for USA (the Mexican private company, which is the third most successful supermarket chain in Mexico, just behind WalMart and Soriana) – have experienced success in the market, while others fail. And which are those successful factors that WalMart should take into consideration for their business model?

OXXO (FEMSA Commerce) could face a good opportunity with the actual crisis

February 17, 2009

Analysis of:Mexican Stock Gains Hinge on U.S.'s Pains | online.wsj.com

There may be a real opportunity for FEMSA with all the world economic problems. Here's why. Participating in a country in which poverty doesn’t mean the same than in developing countries, OXXO (FEMSA Commerce) could accelerate their growth during the further months. Even though the economic conditions of half of the population in Mexico were really bad previous to the crisis, they will not experience many difference in their economies during a crisis like the one we are living, as most of us do. They didn’t loose their savings or retirement plans. They are not on debt. If they do not have a car to go shopping to a big store (and carry all their bags back home), a credit card (to afford buying for a fortnight), and finally, do not have a refrigerator to store the food, they must find a place to buy near their places. That’s why there are more than 450,000 independent retailers in the country, and the reason why the main investments in the trade for Beverage Companies are coolers.

Understanding customer needs to respond to this war

August 13, 2007

Analysis of:Grocery War Heating Up | www.twincities.com

Each comunity has different needs, and if a grocery store try to serve all in the same way are commiting suicide. In some places, going to the supermarket means the weekly shopping day for the family, where they will buy clothing, furniture and more. For some others, is something necessary that people could avoid. If you bring to those places supercenters, where you are not going to be able to support your investment, due to low sales in not grocery supplies, and you will make your possible customers loose a lot of time on those stores, may be you will be in competitive disadvantage. By the other hand, if you try to find some way to take groceries to the customers in an easy and faster way, you will reach more share of that market. The big question is if the companies playing out there now, are understanding the customer needs. You can not treat customers the same way, as some of the bigger ones do, unless you have a competitive advantage over the others that make you irresistible.

Can Major retailers can replace small stores in Mexico?

July 31, 2007

Analysis of:P&G's Global Target: Shelves of Tiny Stores | online.wsj.com

Income for most people in Mexico is an issue which determines where to shop. Most of the population in the country, especially in the south, earn less than $200 dollars per month and do not have car or credit cards to buy in a Supermarket the weekly shopping. Some do not even have a cooler to preserve food. That's why we have small stores in the neighborhoods, like OXXO (FEMSA’s convenience stores), which is growing annual sales with rates over 20% a year, and are the 4th major retailer in the country, only behind Walmart, Soriana and Comercial Mexicana, with smaller and more profitable stores. With more than 5,000 stores, and a new one every 18 hours, OXXO is a competitor to study. That’s why some companies are now looking for this channel, but with some concerns of how getting to the more than 350,000 stores within the country.

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