OXXO’s Expansion Beyond Mexican BordersBy Sofía Hanna | Fri, 12/11/2020 - 08:00
On Dic. 1, the convenience store OXXO opened its first branch in Brazil. During the inauguration ceremony, it was mentioned that this step forward is beneficial for both the company and Brazil, bringing new jobs in a difficult time and providing new shopping and service options to meet customers' needs.
OXXO is a chain of Mexican convenience stores founded in 1977 that is part of FEMSA. Even though the stores took a hit from the COVID-19 pandemic, with profit dropping 50 percent in 3Q20 against 3Q19, Eduardo Padilla, General Director of FEMSA, said the company is ready to embrace new growth opportunities and move to the offensive side. “These include reactivating our store expansion strategy, accelerating digital initiatives across our platform and considering small acquisitions in some of our current business verticals," said Padilla, according to a Milenio article.
OXXO’s first branch in Brazil is only one of the first steps taken in the country, according to Milenio. The plan is for OXXO to inaugurate 500 new establishments in collaboration with Shell Select. In Chile, there are still attempts to expand the brand. OXXO’s goal is to buy OK Market to gain more territory but this agreement has not been closed yet. A deal is expected to be finalized by 2021, according to Milenio.
OXXO has released its own smartphone with access to Facebook and Whatsapp using the KaiOS operating system. The idea of releasing this product is to improve OXXO’s value proposition, offering products and devices that are packed with smart features at an affordable price, as stated by Denise Camacho, General Merchandise Manager at OXXO. The company has also worked on the rebranding of OXXO GAS. Rolando Vázquez, President of OXXO GAS, told MBN the brand is counting on the trust it has built with consumers over the years. Eventually, the company wants to add repair shops, car wash, auto care products and other services to OXXO GAS’ offering.
OXXO has strong development plans. One of its latest announcements refers to an investment of over MX$500 million (US$25 million) to open 402 new stores in 43 Mexican municipalities by 2023, reported Milenio.