With low sales, supermarkets in Brazil reduce stocks even of eggs and milk

Published 2022년 7월 19일

Tridge summary

Supermarket chains in Brazil are negotiating better prices for products like eggs and milk by ordering only what is forecasted to be sold, leading to lower inventories and more judicious discounts for large orders. This strategy has resulted in lower breakage rates and less unavailability of products on shelves, except for essential items like long-life milk and eggs due to factors such as drought, increased cattle feed costs, retail milk price increases, the rising dollar, the Ukraine war, high inflation, and electricity tariff increases. The Brazilian Association of Supermarkets (Abras) is encouraging its members to negotiate more with the industry to understand price increases and identify any unjustified increases. Despite these disruptions, there are no significant shortages in stores, and consumption in Brazilian homes has seen a slight increase compared to the same month in the previous year.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

While negotiating with suppliers better prices for the goods, chains reduce the purchase of products such as eggs and milk. Chains order from suppliers just so they are sure that it will be sold and they negotiate prices. With demand in free fall due to inflation, supermarket chains have worked with smaller inventories and sought to balance orders, by ordering only the forecast of what the consumer will actually buy. With this greater selectivity, however, the arm wrestling between retailers and the industry has increased, which has been more judicious in discounts for large orders. The shopkeepers, in general, have been right in the forecasts. The so-called breakage rate (when the customer does not find all the brands of a specific product), calculated by Neogrid, a company specializing in supply chains, fell in June, to 11%, compared to 11.5% in May. This indicator shows occasional shortages, due to lower inventories and delayed deliveries. Although overall the index has ...

Source: Sintracoop