Retail in Mexico: Cherokee to sell Sideout brand through Soriana

In this week's retail news, Cherokee, a "California lifestyle brand", has signed a 3 year agreement to sell and market their Sideout brand through Soriana.  The deal will include men's, women's, and children's clothing as well as footwear and accessories. 

Soriana has also announced the opening of 5 new stores in November.

Mexico Retail News: Chilean Retailer Ripley Ends Deal with Palacio de Hierro

Ripley, a Chilean department store, has ended a proposed deal with Mexican department store retailer El Palacio de Hierro.  The deal, signed in 2007, would have had Ripley investing a total of $400 million USD over a 4 year period.  Both retailers decided it was best to hold off until both countries economies have recovered. 

The two retail groups were going to target Mexico's rising middle class.  Although the deal was called off, both Palacio and Ripley have not ruled out the possibility of a deal together in the future.

Organic Market in Mexico

Did you know that 85% of Mexico's organic produce is exported to the United States and other countries?

Here are some interesting facts about Mexico's organic market:

-General public in Mexico does not understand the benefits or value of organic products yet

-A few years ago, organic farmers markets started popping up, mostly in southern states like Chiapas, Oaxaca, Veracruz

-Mexico leads the world in export of organic coffee, honey, and agave syrup

-Sales of organic products in supermarkets and department stores grew 20% last year in Mexico

-Aserca and Sagarpa (Mexican govt agencies) are pushing for higher organic consumption in Mexico

-Mexican schools recently banned the sale of junk food
 
What will it take to increase consumption of organic food in Mexico?  Education, education, education!  Consumers need to be educated on the benefits of organic produce and other organic food.  Once they are educated as to the benefits of organic food, they will be more likely to try it.  Price is also a factor.  In a country where Coca-Cola is cheaper than bottled water, producers, government agencies, and retailers will have to work together to make organic food more accessibly priced. 
 
 

Mexico's Retail Wars: Wal Mart vs. Soriana

In the past couple of weeks, TV commercials have been running in what seems to be the beginning of a new retail war - Wal Mart vs. Soriana.   

Wal Mart is going after Soriana's clients with spots that show Soriana customers comparing their grocery receipts with Wal Mart receipts for the same items.   The campaign is called "Desafio de Tickets", loosely translated as the "Receipt Challenge".

When Soriana purchased the Gigante stores, it became Mexico's second largest retailer.  People recognize Wal Mart as the low cost leader, but Soriana is a force to be reckoned with. 

The commercials have caught the attention of Mexico's PROFECO (Federal Bureau of Consumer Interests) who claim that the ads are misleading and after an investigation found several irregularities.



Soriana has accepted the challenge and launched their own commercial in response (sorry for the poor quality video):

Wal Mart Mexico going green

Recently Wal Mart Mexico (WALMEX) announced that it would be switching all of its stores to wind power by 2025.  This includes all of the units of the Wal Mart group including Superama grocery stores, Wal Mart, Suburbia, Bodegas, Sam's Club, Vips, El Porton.

The stores and restaurants will be powered by the Wind Farm 'I Lamatalaventosa Oaxaca, in the state of Oaxaca.  The farm has 27 2.5 MW turbines and will reduce CO2 emissions by 137 tons, which is the equivalent of removing 21,000 vehicles from the roads.

Soriana's profit nearly doubles!

Soriana, a Mexican retailer based out of Monterrey, said it's Q1 2010 profits nearly doubled from a year ago.  Those are pretty amazing results considering all of the economic setbacks Mexico saw in 2009.  The company claims that a change in marketing strategy has lead to increased sales.

Soriana currently has over 471 stores across the Mexican Republic.

Soriana purchased the Gigante chain of supermarkets in 2007, and since then has seen tremendous growth.

Its expansion plans for 2010 include opening 40 new stores.