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flag Chile Chile: Distributing a product

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Distribution

Types of Outlet

Supermercados and hipermercados
This is the most common type of supermarkets which can be found in all Chilean towns.
Lider, Ekono, Santa Isabel, Jumbo, Tottus, Unimark
Wholesale supermarket
A system of free-service supermarkets, which are primarily targeting shop owners, restaurants, hotels and large families.
Mayorista 10 and Alvi Club Mayorista
Farmacias
In addition to medication, pharmacies sell cosmetics, cold drinks, processed foods, fruits, vegetables and meat. These are very common, you find one practically on every corner.
Farmacias Salcobrand, Cruz Verde and Ahumada
Tiendas por departamentos
Located in the capital and in large cities.
Falabella, París, Ripley and La Polar.
Tiendas des ultramarinos
Businesses located on the outskirts of cities and in less populated areas. They offer different types of products but usually little choice. The larger ones also sell fresh products.
Tiendas de conveniencia
Small kiosks (including at gas stations) strategically located and offering a limited range of products such as snacks, drinks, milk, bread and fruit.

Big John, OK Market
Multitiendas
Targeting middle- and lower-income households, these offer less choice than tiendas por departamentos.
Johnson’s (Cencosud), Hites and Corona
Tiendas de mejora del hogar
Shops specializing in household goods.

Sodimac (run by Falabella), Construmart (SMU), MTS, Easy (Cencosud) and Chilemat.
Shopping centers / Malls
Found in all large cities.
Alto Las Condes, Parque Arauco, La Dehesa, Vivo el Centro, Apumanque, Costanera Center.
Traditional shops and markets
In most of the country there are central markets selling fresh fruits and vegetables, fish and other goods, supplying households but also restaurants and small shops.
Travelling shops (ferias libres)
Small stands selling fruit and vegetables and other products, which visit towns once a week. They offer quality products at better prices than supermarkets.
 

Evolution of the Retail Sector

Growth and Regulation
The Chilean food retail sector is composed of a mix of large supermarkets, mid-sized grocery stores, convenience stores, gas station markets and thousands of smaller independent neighborhood convinience stores. The Chilean retail industry is the most developed in the Latin American region, with retail sales reported at USD 27.9 billion in 2020, with a 2.9% increase over the previous year (US Foreign Agricultural Service). Supermarkets food sales totaled USD 15.1 billion, or 54.2% of total food sales in 2020 (US Foreign Agricultural Service). On-line food sales are growing, boosted by the social distancing measures and strict quarantines implemented in 2020 to avoid the spread of the COVID-19 virus. Online food and drink sales totaled 1.2 billion and grew by 133% in 2020 (US Foreign Agricultural Service).
According to the National Institute of Statistics (INE), in 2019 (latest available data) the Chilean food retail sector comprised 1,382 stores, including hypermarkets, supermarkets and other small food retail stores with a minimum of three checkouts, with 34% of them are in the Metropolitan region.
It is worth noting that Chile is becoming increasingly urbanised. This is not only true in the Santiago Metropolitan Region (which accounts for one-third of the country's population), but also in provincial or second-tier cities. The distribution sector has been adjusting to this trend, especially grocery retailing, which has been adopting a convenience store model through chained convenience stores and smaller supermarkets located close to consumers in the middle of residential neighbourhoods. This development is also due to a scarcity of retail space and Chilean consumers' interest in convenience.
Market share
The distribution sector in Chile is highly concentrated with only a small number of actors sharing a majority of total sales. There are eight major supermarket chains in Chile, targeting different customer profiles with different format stores, spread all over the country.
Chile’s main supermarket groups in 2020 were (US Department of Agriculture):
- Walmart Chile, the largest supermarket chain in the country in terms of revenue with a market share of approximately 12.9%, operating around 363 stores under the Líder and Express de Líder brands
- Cencosud, with a market share of around 7.5%, operating around 247 hypermarkets and supermarkets under the Jumbo and Santa Isabel brands
- SMU is the third largest chain with a market share of 6% and 290 stores under Unimarcbrand
- Tottus (owned by Falabella) with a market share of 2.1% and 69 hypermarkets and supermarkets.
 
Retail Sector Organisations
Asociacion Gremial de Supermercados de Chile
 

E-commerce

Internet access
With a population of over 18 million, Chile is the 7th most populated country in Latin America. As of June 2017, there were 14.1 million Internet users in Chile, which accounts for 77% of the population. According to WeAreSocial, in 2017 laptops and desktops account for 56% of web traffic (decrease of 16% when compared to 2016), while mobile phones represent 42% (increase of 34%). The use of broadband is widespread, although the speed and cost may vary from one place to another. According to Pewglobal, as of 2017 65% of the population owned a smartphone, out of which 86% were aged between 18 and 35 years old. The most popular search engines are Google (97.73%), Bing (1.16%), Yahoo! (0.98%), DuckDuckGo (0.05%), MSN (0.03%) and Baidu (0.01%).
E-commerce market
In the last five years, e-commerce has more than doubled in Chile. The Santiago Chamber of Commerce estimates that online B2C sales in Chile in 2017 have reached US$ 3 billion, a dramatic increase of 20% since 2016. This has opened the appetite of many national and international actors, including the established retail, which entered to compete in this segment. Several traditional stores have been investing in technological and logistical solutions that allow customers to have an online shopping experience. Chile’s digital economy currently accounts for 3% of GDP. By 2020 it is expected to increase to around 4.5%.
E-commerce sales and customers
In 2017, Chilean B2C e-commerce turnover grew by 15% to US$ $3 billion . Chile had an online population of 12.4 million of people who were aged 15 and older, and 5.7 million of those were online shoppers. Mobile purchases are growing in the country, and 40% of the population makes mobile monthly purchases. In addition to B2C online sales from large Chilean retailers, such as Falabella, Cencosud (Almacenes Paris, Jumbo, Easy), and Ripley, Chilean online consumers also regularly use Alibaba, Groupon and other international e-commerce only retailers present in the Chilean market. In the first quarter of 2017 e-commerce sales in Chile went up by 30% compared to Q1 2016 and totalled US$ 864 million. The total of e-commerce sales in 2017 in reached US$ 3.7 billion—a 20% increase from 2016. E-commerce platforms are complementary to physical stores since Chileans often look for products online before making a physical purchase.
Social media
There are 13 million active social media users in Chile, with a penetration of 71%. Of all the social media users, 68% access a social network on a daily basis. There are 12.3M Facebook users in Chile, out of which 51% are female. Over 70% of all Facebook users who live in Chile are aged 18-44. The most popular social networks in Chile are Facebook (68.31%), YouTube (13,46%), Pinterest (9,6%), Twitter (5,53%), Instagram (2%) and Tumblr (0,67%).

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Distance selling

Evolution of the Sector
According to the World Federation of Direct Selling Associations, Chilean direct retail sales in 2016 ascended to USD 593 million (a 7% increase compared to 2015). The sector also includes 374,800 independent representatives. Euromonitor International states a reduction in Chile's economic growth has fostered direct selling. Internet retailing has also slowed direct sales, representing the greatest risk for this industry.

Chilean direct selling formally began in 1977 with the entry of Stanhome and Avon. Although Avon is the current market leader, even this company have decided to open a number of outlets in shopping centers in Santiago, the Chilean capital. Beauty and personal care products are the industry bestsellers.
 

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Latest Update: September 2022