| Boom in Brazil’s Retail Sales |
|
|
|
| Saturday, 03 November 2007 | |
|
The retail sales in Brazil is showing strong growth, thanks to growing disposable incomes, less import costs, increment of minimum wages, more cash handouts, and so on. Brazil’s retail sales grew 0.7% in the month of August (2007) from July (2007). The growth in retail sales was due to monthly expansion for the eight time in a row - sales of appliances, furniture, and clothing increased, as per IBGE (Brazilian Institute of Geography and Statistics), a statistics agency. The Reuters published this news.According to the IBGE, sales registered by the clothing, textile and shoes segment increased by 4.6% from the month of July (2007). The sales of appliances and furniture rose by 4.7%. The retail sales in August (2007) grew 9.9% compared to the same month in 2006. The 6.4% profit in the food, drinks, tobacco and supermarket sales led the annual growth in retail sales. The strong rally by the Brazilian Real against the dollar ever since 2000 has helped in lowering the import costs allowing the people with lower incomes to increase their purchasing. The rising disposable incomes as well as pent-up demands are surging the real estate returns in Brazil, thereby fuelling the home appliances, PCs, and automobiles’ demands. Amidst the declining inflation, other factors like tourism, foreign investments, and internal growth are helping the growth of the country’s economy. The Brazilian families in the poor northern states are also making more and more purchases of the consumer goods in a faster pace than national average. This indicates that the handouts by government are leading to the growth in that region resulting in the Brazilian retail sales to grow. Luiz Inácio Lula Da Silva, the President of Brazil, pledged to encourage the annual growth to 5%, and increased the minimum wage, cash handouts for poor people as well as the state pensions. This has increased the capacity to spend. A Senior Research Analyst at RNCOS said, “Brazil is amongst the largest retail markets of the world. Retail sales in the country are showing strong growth and expected to continue growing, as the steady decline in inflation rates are allowing the expansion of real income and easing the credit conditions. But the market faces two main challenges - increasing population in Brazil that will need more food, and fast adoption of urban mannerisms and lifestyle by the people. Therefore, the retailers are compelled to put extra resources to alter their plans according to customer’s habits time and again”.
|
| < Previous | Next > |
|---|
.jpg)
