Fronts of attack of Grupo Pão de Açúcar

In a year when Brazilian supermarkets plan to a modest growth of 3%, the Pão de Açúcar group, the country's largest retailer, has placed a bold expansion project. Under the command of the French Casino Group, the network will inaugurate between 2014 and 2016, 650 new stores, nearly four per week. The number is 2.6 times greater than the 249 open units in the last three years, when the company was in the middle of a crossfire between the French shareholders and the former controller, Abilio Diniz.
Now, with the Casino alone in front of the business, the expansion plan has gained more importance. The power segment, which includes the Extra flags, Pão de Açúcar and Assai, will lead the growth. And between these two marks appear as flagship: the atacarejo Assai, acquired by the group in 2007, and the neighborhood market model, with the Extra flags Minimarket and Minute Sugar Loaf (Pão de Açúcar), whose first store went into operation a week ago, in the gardens, noble region of São Paulo.
"For this year, we identified opportunities for opening of shops in all of our business, in various regions of the country", says the Chairman of the group, Ronaldo Iabrudi, who took office in January this year in place of Aeneas Pestana, Executive hired in 2002 by Abilio Diniz, who is now chairing the Board of Directors of food manufacturer BRF.
Although no retail experience, Iabrudi is known to long-time French Jean-Charles Naouri, Casino owner and right-hand man of boss in Brazil. Last year, he was hired as a representative of the Casino in the country and then became Chairman of the Board of Directors of Grupo Pão de Açúcar. With the unexpected exit of Pestana, Iabrudi assumed the Presidency and, at least for now, is responsible for leading the largest expansion of the company's recent history.
The offense of Sugarloaf coincides with a time when competitors are taking breath to re-grow. With new command in Brazil since December last year, Carrefour not inaugurates a store with their main flag since 2010. "He has to relearn to expand," said recently the French Executive Charles Desmartis, responsible for Carrefour's Brazilian operation, which is the second largest retailer in the country.
Chile's Cencosud, ranked fourth, is also not full steam ahead. Mrs. das bandeiras GBarbosa, Bretas, Prezunic, Perini and mercantile Rao, the company just announced the end of the process of integration of networks, after a period of reduction of headcount and drop in operating margin.
"How to grow with supermarkets is increasingly complicated, because of the difficulty of finding manpower, real estate valuation and the change in consumer habit, the Sugar Loaf (Pão de Açúcar) is worth of various formats that have in its portfolio to make the expansion," says Sussumo Honda, President of the Advisory Council of the Brazilian Association of Supermarkets (Open).
Two market trends were the basis to define the strategy of the Group: customers looking for low price, in the case of atacarejo, and urban centers after consumers desirability, even if it means spending a little more.