Ecuador Retail Market

[slideshow_deploy id=’1744′] Ecuador retail market has made a come back over the past two years in large part thanks to public spending and higher remittances from Ecuadoreans living abroad. The increased purchasing power of the population has translated into higher demand for consumer goods.  Ecuador retail sales grew by 8.6% during 2011 and are projected to stay at 5.7% through 2015, according to the Economist Intelligence Unit (EIU). Retail growth in the next 3 years will be driven by the increasing expansion of retail chains such as La Favorita, El Rosado, and Tia in both non-grocery and grocery outlets and primarily in low income and rural areas. ecuador retail market

Ecuador, a nation of 14.4 million, has undergone steady development of shopping centers. In 2011 there were 77 shopping centers in the country and 269,000 retail outlets. Ecuador’s retail sector is dominated by major supermarket chains such as Quito based Supermercados La Favorita, which is owned by Corporación Favorita, who operates Supermaxi supermarkets, Megamaxi hypermarkets, Aki and Gran Aki. Guayaquil’s El Rosado, who owns Mi Comisariato, Hiper Market, Ferrisariato, Mi Jugueteria, and Supercines have a market share of 8.4% (103 stores), and Tia (Ecuador), which operates smaller discount stores, has a 6% market share with 119 stores.With over 70% of medium- and high-income groups already purchasing food in supermarkets, the next move for the sector will be to target middle- and low-income consumers and to expand to smaller cities, where there is more informal retail. Food sales represented an estimated 55% of Ecuador’s total retail sales in 2011, which is higher than in other Latin American countries. Imports make up the bulk of the retailing market. Corporación Favorita and the Ecuadorean government have launched the Ecuador buys Ecuador program, which aims to promote certain local products by purchasing around US$200m of goods per year.

Ecuador’s various retail segments offer opportunities for international retailers. EIU projects consumer spending on restaurants and dining out ($2.5 billion in 2010) to grow 8.4% in 2011-15. All major U.S. QSR brands are present in Ecuador’s although highly concentrated in the largest urban centers. Demand for consumer electronics, along with other big-ticket items is projected to increase gradually during 2011-15 in line with improved economic conditions and rising incomes. Ownership of PCs, televisions and other household audio equipment is low by both international and regional standards. Demand for apparel and footwear, particularly more fashionable brands from the US, is expected to increase by an annual average of 7.1% and 6%, respectively. Demand for white goods and big ticket items will pick up slowly supported by better access to credit, and stronger growth.


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