First supermarket chain to introduce organics in Brazil
Posted - October 4, 2009
Pão de Açúcar champions health and well being
By Adriana Michael and Carla Pioli
Pão de Açúcar, part of the Companhia Brasileira de Distribuição, celebrates its 61st anniversary this September as the most successful food retailer in Brazil. It can also boast being a pioneer, since it introduced organic foods in its stores 15 years ago, the first supermarket chain in Brazil to do so.
What began in 1940 by Portuguese immigrant Valentim dos Santos Diniz as an ordinary food store in São Paulo, has turned into the biggest Brazilian retailerof food, general merchandise, electronics and home appliances, one of the most successful retail operations in Latin America. The group operates under different concepts and store names, including supermarkets, gas stations and pharmacies. The company has 1200 outlets spread across 17 states in Brazil, with a total sales area of over 1 million square meters, and a sales force of more than 79 thousand employees.
Ten years ago, only a limited selection of organic fresh produce was available at the stores. Today, Pão de Açúcar has a portfolio of over 600 organic products, from fruits and vegetables to grocery items, dairy, meat, bakery and frozen foods. Fresh produce is still the bestselling category according to Sandra Caires, manager of the organic department. More than 70% of all the volume of fruit, vegetables and organic vegetables sold by the Group are concentrated in São Paulo.
Pão de Açúcar is a local showcase for some of the best organic brands from Brazilian suppliers. The gourmet section is expanding this year, along with a section of imported wines. Some other imported brands, such as the cereal beverages by Italian firm La Finestra sul Cielo are performing well . “Brazil offers soy drinks, but rice milk and other cerealdrinks are not produced locally”, says Jeffrey Sidi of Sim Alimentos distributor of La Finestra. “Gradually, Brazilian consumers are more aware of the difference between conventional and organic certified products. We need to make the effort to increase awareness with education, local fairs and direct contact with the consumer”. Non-food products such as natural cosmetics are another emerging segment of interest at the stores.
Own wellness brand TAEQ
The group also carries around 300 products for the health and environmentally-conscious consumer under its own brand, TAEQ. It is the only complete ‘wellbeing’ brand in Brazil, available in the Group’s Extra, Pão de Açúcar, Sendas and CompreBem stores. The line offers products based on nutrition, organics, sport, home and beauty. The company has created exclusive selling spaces for the products under the TAEQ brand, on display in its own specialized thirteen stores: ten in São Paulo, two in Rio de Janeiro, one in Fortaleza and one in Brasília.
New model for green retailing
Pão de Açúcar is committed to further developing and converting into a fully sustainable enterprise. In view of the current boom for organics and the search for eco-friendly lifestyles, the Group invested in building the Pão de Açúcar Loja Verde last year, Latin America’s first “green” supermarket. The store serves as a model for sustainable retailing. It is the first supermarket in Brazil to apply for certification from the Leadership in Energy and Environmental Design (LEED), in accordance with the standards set by the U.S. Green Building Council. The store also serves as a working laboratory for testing new business practices in sustainable technology, innovations that can be applied throughout the Group’s stores. Pão de Açúcar Loja Verde carries around 750 organic food and non-food and sustainable products. Displays are set up in diagonal positions rather than the traditional vertical layout. Similar products are shown together for consumer convenience.
Features to enhance the shopping experience of the health conscious shopper include: introduction of reusable shopping bags to reduce use of plastic bags; shopping carts made out of recycled plastic bottles; biodegradable produce trays made out of mandioca (”yucca”) starch; better lighting and displays, increased number of locally- sourced organic and natural products, in addition to highly demand imported goods not found in Brazil; less use of paper in marketing activities; increased in- store and consumer recycling programs; expansion of its “Little Citizen” (PA Kids Program) to foster responsible consumption in the future generations; better logistics for reducing packaging materials, transportation costs, water and energy usage and offers of incentives to suppliers who adhere to sustainable policies. Within nine months of its opening, water consumption at the Green Supermarket dropped by 10 percent, and energy use is 14 percent lower, compared with other stores.
Pão de Açúcar awards suppliers
Since 1995 Pão de Açúcar has developed a strong partnership with its suppliers, as it was the first retailing group to envision the potential of the organic sector. To recognize its top suppliers, Pão de Açúcar created an award this year granted to the best companies in the following categories: Pioneer (Native), Innovation (Friboi), Store Action (Cultivar), Success Story (Quinua Real), Customer Service (Fazenda Salvaterra) and Own-Brand (Engenho da Terra).
“We hope to go further in this segment with this Award and keep our leadership position, “says Sandra Caires.
In 2009, the company will include for the first time sustainability indicators to rank companies, in addition to factors such as punctuality, Quick Response, quality control, optimization of resources and logistics to reduce pollutant emissions and packaging.
There is still a long way to go in the evolution of a giant retailer like de Pão de Açúcar Group, but it is encouraging to see the willingness of top management and the commitment of employees and shoppers to find better ways to live and do business with an effort to leave a smaller carbon footprint on the planet!
