Tag Archives: Brazil
SAO PAULO (Reuters) – Amazon.com Inc is launching its long-awaited in-house fulfillment and delivery network in Brazil after months of delays caused by complicated logistics and a highly complex tax system in the largest Latin American economy.
FILE PHOTO: The logo of the web service Amazon is pictured in this June 8, 2017 illustration photo. REUTERS/Carlos Jasso/Illustration/File Photo
Amazon, which some rivals had expected to kick off direct sales of items beyond books as soon as the Christmas selling season, said it will directly sell 11 categories of merchandise from over 800 suppliers from L’Oreal to Black & Decker as of Tuesday.
Its shift to stocking and delivering goods itself from acting mostly as a marketplace is expected to intensify competition for fast delivery of goods in Latin America’s largest economy as it exits a painful recession.
“We are launching (our direct sales platform) with 320,000 different products in stock, including 200,000 books… Our obsession is always to increase this catalog and to have everything Brazilian consumers seek and want to buy on the internet”, Amazon’s Brazilian country manager Alex Szapiro told Reuters.
In November, Reuters reported that Amazon’s attempt to advance with its so-called Fulfillment by Amazon program in Brazil had run into difficulties such as the nations’s tangled tax system, complicated logistics and testy relations with some prominent vendors.
“As in every negotiation, you take a seat at a table and you want to agree on the best possible terms”, said Szapiro when asked on the tone of conversations with suppliers, without entering in details.
Amazon entered Brazil quietly in 2012, selling e-readers, books and then streaming movies in the fast-growing Brazilian market. The company made its first big move into merchandise in October 2017, when it began offering the use of its Brazilian website to third-party merchants to sell electronics.
The company does not reveal the number of sellers in its marketplace, which it has slowly expanded over the past year, adding new categories while laying the ground for a direct sales platform.
As part of the fulfillment program, Amazon leased a 47,000 square-meter (505,904-square-foot) warehouse just outside of Sao Paulo, as first reported by Reuters almost a year ago.
Szapiro, who previously worked as Brazil country manager for Apple Inc, declined to say how much the company is spending on the new distribution center or how many people it is hiring, but said Amazon employs directly and indirectly over 1,400 people in Brazil.
In a report published on Monday, analysts at investment bank BTG Pactual said the expected direct sales launch signaled the company was ready “to strengthen investments, potentially via more partnerships with fulfillment operators and last-mile carriers.”
Even though the bank predicted Amazon would take a “gradual approach” and was likely to vye for a “low double-digit market share,” shares of Brazilian retailers reacted negatively to BTG’s report, with B2W, Magazine Luiza e Lojas Americanas among the biggest losers in Monday’s session.
Reporting by Gabriela Mello; Editing by Sandra Maler
SAO PAULO (Reuters) – Amazon.com Inc (AMZN.O) is looking to lease a 50,000-square-meter warehouse just outside Sao Paulo, people familiar with the matter told Reuters, as it steps up its push into Latin America’s biggest retail market, Brazil.
The logistics investment, which would be four times the size of its current book-shipping operation in the country, is a sign the online retailer may soon handle distribution of electronics and other goods sold on its Brazilian website.
That would be the first step of its kind for Amazon in Latin America’s largest economy, where it currently relies on third parties to ship their own goods sold on its marketplace, and it underscores the seriousness of the e-commerce giant’s renewed push into Brazil.
Amazon declined to comment to questions about leasing a warehouse.
While an estimated two-thirds of Brazil’s 209 million people have internet access, online retail was slow to take off at first, amid concerns over security and complications with tax and logistics in the continent-sized country.
E-commerce accounts for around 5 percent of Brazil’s roughly $ 300 billion retail market — about half its share in the United States — but it has doubled in the past four years and is forecast to keep growing annually at a double-digit pace.
Now Amazon, which expanded its Brazil business from books to electronics in October, is gearing up to fight rivals such as Latin Ameria’s homegrown e-commerce champion Mercado Libre Inc (MELI.O) and B2w Cia Digital, (BTOW3.SA) which is indirectly controlled by partners of private equity group 3G Capital.
“You obviously can’t underestimate a company like Amazon,” said Pedro Guasti, CEO of Brazilian online consultancy Ebit. “It has huge capacity to invest and it’s obviously taking a bigger bite of the cake than it did last year.”
Mercado Libre Inc, B2w and local retailer Magazine Luiza SA (MGLU3.SA) have stolen a march on Amazon by storing and shipping goods appearing on their websites even when offered by third-party sellers, to ensure speed and customer satisfaction.
Amazon, by contrast, has been slow to tackle the challenges of shipping in a country where tricky logistics and tax issues have long made online retail an unprofitable venture.
In Mexico, Amazon launched its third-party marketplace coupled with its own shipping service, called “Fulfillment by Amazon,” in 2015.
The contrast has been stark. Nearly 20 percent of reviews on Amazon’s Brazilian marketplace are negative, compared with 10 percent in Mexico and just 4 percent in the United States, according to e-commerce analytics firm Marketplace Pulse.
Complaints in Brazil often focus on delayed or canceled orders – a problem dramatically reduced in other countries when Amazon itself packs and posts orders of third-party goods stored at its warehouse facilities.
In an early sign of Amazon’s Brazilian logistics push, the company posted more than a dozen listings for distribution jobs in the country to LinkedIn last year, including “Site leader, Fulfillment Center”.
The new warehouse site outside of Sao Paulo, in the municipality of Cajamar, looks to be a step in that direction.
There San Francisco-based logistics company Prologis Inc (PLD.N) has offered a 50,000-square-meter space to Amazon in a new industrial park that hosts DHL and Samsung, according to sources, who said adaptation of the warehouse had not begun.
Prologis, which also partnered with Amazon on a mega-warehouse north of Mexico city last year, declined to comment.
The preparations in Brazil come as Luft, the local logistics operator for Amazon’s book business, readies a move into another Prologis site nearby in Cajamar, sources said, leaving its current 12,000-square-meter facility in the city of Barueri.
Amazon registered in October to conduct operations in Cajamar, according to municipal records seen by Reuters.
The new logistics investment could spell trouble for rivals.
Mercado Libre has been a success story among Latin America tech start ups: its shares have nearly tripled since 2014, bringing its market capitalization to more than $ 15 billion.
Magazine Luiza’s stock has risen sixfold in each of the past two years as it shifted its rolled out an ambitious e-commerce strategy built on its brick and mortar stores.
Reporting by Gabriela Mello; Writing and additional reporting by Brad Haynes; Editing by Daniel Flynn and Alistair Bell
SAO PAULO (Reuters) – Brazilian wireless carrier Oi SA’s (OIBR3.SA) two biggest creditor groups on Monday reaffirmed their commitment to an alternative debt-restructuring plan, about a month after pushing back against a proposal from the company’s management.
In a statement, the International Bondholder Committee and the Ad-Hoc Group of Oi bondholders, along with a group of export credit agencies (ECAs), said their plan would have the company invest 6.5 billion reais (1.55 billion pounds) per year, a 30 percent increase from current levels.
Both groups and the ECAs are owed a combined 22.6 billion reais, or more than one-third of Oi’s 65 billion reais in debt being restructured in court as part of Brazil’s biggest bankruptcy protection case ever.
Their insistence on an alternative to Oi’s proposal highlights the conflict between Oi management, shareholders and creditors at Brazil’s No. 4 wireless carrier.
Oi’s Chief Financial Officer Ricardo Malavazi Martins resigned on Monday, the company said in a securities filing, without specifying a reason. Current head of investor relations Carlos Brandão will take on his duties on an interim basis.
The creditor groups had said in August they would agree to swap 26.1 billion reais worth of their Oi bond holdings for 88 percent of the company’s equity.
They also endorsed injecting 3 billion reais of fresh capital into Oi, revamping governance practices, repaying regulatory debts and equal treatment for Oi’s unsecured creditors.
Their proposal contrasts with the management plan to inject 8 billion reais worth of capital into Oi through a sale of new stock and a debt-for-equity swap. Oi executives suggested last week they could increase the size of the capital hike to 9 billion reais, but creditors did not vote on the change.
Reporting by Bruno Federowski; Editing by Tom Brown
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