Wal-Mart Wants Brazil

Wal-Mart opened its first neighborhood-style store called “Wal-Mart TodoDia” on Thursday in Sao Paulo, Brazil. The Bentonville, Ark., retaileralso opened a distribution center outside of the city earlier this week,large enough to supply 100 outlets. Wal-Mart has plans to open at leastfive more stores this year alone in Brazil.

The new store format Toda Dia (meaning “everyday” in Portuguese) is asmaller, stripped-down version of the typical Wal-Mart super-center.Peter Hardtmeier, a Brazilian supermarket veteran, named director of newbusinesses for the retailer last year, has concentrated on expandingthis new format throughout Brazil. The inside of these new stores looksmore like a warehouse with its concrete floors, lack of air-conditioningand displayed products shown in factory-shipped boxes. The constructionis so simple that one store can be built in a three-month time frame.

The Toda Dia offers a narrower selection of products than the average Wal-Mart, but will sell food and household items for 5 percent less thanits competitors. This format is expected to go over well in Brazilbecause of the community member's low income level and their desire totravel short distances to reach discount centers. Wal-Mart's Toda Dia ishoping to attract locals by offering Brazilian “pastel” (pastries) andthe national staple, black beans, for shoppers.

According to a survey done by the University of Sao Paulo, winningcustomer loyalty is the key in Brazil. In hopes of doing just this, TodaDia promotes its credit card, which offers no interest on merchandisepaid for within 45 days of purchase. So far, more than 4,000 people haveenrolled.

Wal-Mart Stores Inc. already claimed the title of biggestmass-merchandiser in Mexico and continues to have a strong presence inseven other countries overseas. Currently in Brazil, Wal-Mart fallsextremely short in sales compared to market leader Pao de Acucar Group,and number two, Carrefour. Retail expert Claudio Felisoni de Angelo,anticipates that Wal-Mart will become a force to be reckoned with as itcontinues to expand across the country.