Duty Free Americas is preparing to open its first Brazilian border store next month in Uruguaiana, the second largest city on the Brazilian border with Argentina.
The store is located across the street from the 850sq m Dufry outlet which opened in July. The Dufry opening followed the unveiling of the inaugural Brazilian border stores in Barra do Quarai and Yaguarao.
Leon Falic, President, Duty Free Americas tells TRBusiness that the Uruguaiana store will be relatively similar to the Dufry outlet. He said: “In our business, it’s tough to differentiate. Everybody carries the same product and the rule of thumb is that there is always demand for a certain product locally. This is the product we end up selling the most of.”
He added: “We will differentiate ourselves perhaps in terms of service, pricing and promotions, but in terms of products, our offer will be similar.”
BRAZILIAN BORDER STORE PLAN
Further Brazilian border stores operated by DFA are also in the pipeline, according to Falic. “When we enter a country to open a single store it is very difficult. We are definitely going to open more Brazilian border stores.”
The gradual opening of land border duty free stores in Brazil comes after legislation was finally approved following the submission of a draft bill in 2012. The approval of the legislation was announced by Gustavo Fagundes, ASUTIL President and Dufry General Manager Brazil at the inaugural Summit of the Americas in Orlando last year.
DFA’s Brazilian operations include a state-of-the-art 10,000sq m store in Rio Branco on the Uruguayan border with Brazil which opened last year. The retailer also runs shops in many of Brazil’s main airports including São Paulo-Congonhas, Tancredo Neves Confins in Belo Horizonte and Afonso Pena in Curitiba.
Political uncertainty before and after the general election in Brazil last year and the devaluation of the Brazilian real against the US dollar have not been conducive to strong DF&TR sales, but Falic remains upbeat. “To be honest, Brazil has been difficult for us. It is not where it is expected to be. Brazil will only get better which is good news and the new government is excellent.”
He added: “We are still investing and bullish on Brazil, but it is going to take some time until it gets to where we want it to be.”