SAO PAULO — The explosion in online sales generated by the coronavirus pandemic has not slowed down in 2021, given the reopening of the economy with vaccination. One of the main players of national e-commerce, Mercado Livre (MELI34) will hire 8,500 people over the next four months to meet the strong demand.
“E-commerce still has a 10.5%-11% penetration in total retail in Brazil. It’s still low. We went from 5% at the beginning of the pandemic and we had a quick jump to 11%, as if all people and companies were forced by the force [a comprar/vender online]. It’s as if we had taken the year 2030 and moved to 2020”, said Fernando Yunes, Senior Vice President (SVP) of Mercado Livre in Brazil, live on InfoMoney.
“The number of users, both at the customer end and at the seller end, increased violently and this took the penetration of e-commerce in Brazil from 5% to 10%. This year it’s at 11%. The world average is 18%. The United States is at 25%. China is at 40%. (…) The number of companies that have not yet entered the marketplace is still great. (…) And there are still a lot of users [de internet] who is not an e-commerce buyer. We remain optimistic. By the end of this year alone, we are going to hire 6,000 own employees and 2,500 outsourced workers. There are 8,500 new hires in four months. This is what shows our commitment and confidence with what lies ahead”, he added.
Live is part of the project Inside the Results, wherein InfoMoney interviews CEOs and directors of important publicly traded companies, in Brazil or abroad. They talk about the balance sheet for the second quarter of 2021 and perspectives. To follow all the interviews in the series, subscribe to the InfoMoney YouTube channel.
Yunes highlighted that the entry of new sellers on the Mercado Livre platform was already strong in the second quarter and continues at this pace, both for small companies and large brands. In addition, the executive commented that the group is always looking to meet new segments, such as the recently launched supermarket operation.
“The supermarket in the Free Market started about a year ago and already represents 10% of the group’s total sales. It was an exponential growth. (…) Pharmacy is something we are studying and we have been talking to potential partners. In the coming months, we do want to bring news about this segment”, said the SVP.
The executive mentioned the investments that have been made by the Free Market in the country. “We started the year with three distribution centers and we’re going to end it with eight or more CDs, maybe we’ll even announce something more by the end of the year,” he said. Yunes highlighted some competitive advantages of ML over the competition, such as same-day delivery service to many zip codes.
Regarding logistics, the Free Market’s SVP commented that 91% of the company’s deliveries are currently made by its own transport and that it would not be interested in participating in an eventual privatization auction of Correios. He also spoke about how the group is prepared to have a big Black Friday in 2021, even stronger than last year.
Tulio Oliveira, vice president of Mercado Pago and who also participated in the live, commented on the growth of the arm of fintech of the group, which already represents a third of ML’s total revenue in Latin America. The executive highlighted the growth of credit in Brazil: 27 million users have pre-approved credit available.
He spoke about the recent launch of the Mercado Pago vehicle tag, Ultrapasse, in partnership with ConectCar. “We are putting this as another level six benefit of our loyalty program. It has all the content and the free tag. The other customers pay a monthly fee”, he said.
“There are markets that are already consolidated, such as the machine, where we compete head to head with our main competitor. And now we are getting into products for individuals, digital account, payment account, credit card and we are working on a better investment solution. Other solutions are to come. We want to serve the individual very well”, he added.
Yunes and Oliveira also talked about ML having opened up the option for people to pay to be at the highest level of the company’s loyalty program, about competition, about increased fuel prices impacting the cost of fleet delivery and free shipping, and about occasional Fusions and acquisitions. Watch the full live above, or click here.
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