Brazilian food retailer GPA SA expects e-commerce sales to jump by more than five times over the next four to five years while maintaining margins, chief executive Jorge Faical has said.
Speaking at a Credit Suisse online event, Faical said that digital sales across the sector have tripled since the beginning of the pandemic, to about 1.5% of total sales.
At GPA, where the largest shareholder is France's retailer Casino, 9% of all sales are online.
Online Growth Challenges
Faica mentioned a series of challenges for supermarkets to sell online, such as the delivery of products in increasingly shorter deadlines, which makes the process more expensive and puts pressure on margins.
Even so, he said the company believes it can maintain the same profitability levels in e-commerce sales as in physical stores, which should be facilitated by the group's network of around 800 stores across the country that can be used as distribution centres.
In November, GPA set out ambitious expansion plans, saying that it planned to open 100 Pão de Açúcar stores by 2024, compared to the previous goal of 50 by 2023.
It also plans to open 100 new outlets under the proximity formats Minuto and Pão de Açúcar Fresh by 2023.
Late last year, GPA reported consolidated net revenue from third-quarter sales of 12.1 billion reais (€1.89 billion), with LFL sales, excluding hypermarkets and drugstores, in line with Q3 2020. The figures include the performance of GPA Brasil and Grupo Exito (Colombia, Uruguay and Argentina).
The group recorded all-time high online food sales of 475 million reais (€74.5 million), up 46% and accounting for 9.3% of total sales (6.3% in Q3 2020).