[ClickPress, Fri Feb 06 2015] During 2014, grocery retailers in Costa Rica continued to focus on offering attractive value relations to consumers, which were mainly represented by discounts and offers in the case of supermarkets (even in the case of the high- end players), hypermarkets and discounters, while convenience stores remained committed with offering time-saving, differentiated items and product availability as its main strengths to attract local consumers. Convenience stores continued to develop towards reaching the mid and upper class local consumers, expanding in the main urban central locations of Costa Rica keeping the rapid growth inertia which has characterized this format over the review period, while independent small grocers continued making efforts to reinvent its traditional business model, by incorporating additional services (such as public services paying platforms) and in remodeling stores.

Competitive Landscape

Wal-Mart Centroamérica SA retained its leadership within grocery retailers in Costa Rica, accounting for 34% value share during 2014. This multinational company operated 217 outlets in the country during 2014, with most of them being discounters (180 outlets), followed by supermarkets (29 outlets) and complemented by eight hypermarkets under its core Walmart brand. This number of stores only gives a partial idea of the negotiating capacity and the strong economy of scale savings developed by this global retailer in the region, as it also operates a vast number of stores in Central American, reaching a total number of almost 600 outlets. In addition to leveraging its growth potential by targeting the vast number of lower and mid-income consumers though its discounter formats and low prices policies, this grocery retailer player has also been capable of reaching more specialised consumers through its supermarket brand Mas X Menos (targeting upper class buyers) which was also complemented by its hypermarkets which attracts lower and upper class consumers at the same time.

 

Industry Prospects

Grocery retailers’ inertia registered during 2013 to 2014 is anticipated to continue driving this channel over the forecast period, with modern channels expanding their penetration at the expense of more traditional formats, particularly in the case of convenience stores and high footage outlets such as warehouse types discounters, warehouse clubs and mass merchandisers (which shall continue increasing the mix of grocery goods offered in their outlets). Within this context it is anticipated that convenience stores will see more players participating within this category, which will begin to reach a wider base of mid-income consumers given the fast urban expansion in the main urban locations of Costa Rica. Pricing is also expected play a more significant role in the interaction between channels and consumers, boosted by the accessibility to internet shopping platforms and the consolidation of more rational shopping habits amongst the population.