Country s Context, Chile
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- Jodie Pitts
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1 Chile Supermarkets
2 1 Country s Context
3 Deterioration in consumer confidence Country s Context, Chile Perception of the economy Index Historical series of 36 years** (Index pts.*) *Note: 0 indicates pessimism and 100 indicates optimism. **Note: IPEC index was originally published on a annual basis ( ), afterwards on a quarterly basis ( ) and since 2002 its calculated on a monthly basis Source: GFK Adimark
4 Country s Context, Chile What is happening with consumption? Slight contraction in consumption Higher frequency, lower volume Preferences on Supermarkets vs Hypermarkets Smart shopping Increasingly promotional customer Labelling Law
5 Our SG&A challenges Country s Context, Chile Increase labor costs Impact of 7 Sunday new bill Surcharge of 30 % for Sundays workday Minimum wage increase Electric rate hikes and reassessment Increased security expenses
6 2 Our Brands
7 OUR POSITIONING Jumbo exists for guests to enjoy and be happy in every shopping experience /Functional Benefits Wider assortment and quality of products Better Shopping experience Greater product availability Savings through relevant promotions DIFERENTIATION SERVICE, SERVICE, SERVICE / Brand personality Accomplice and ally, empathy Uses its service orientation to transform situations and turn everyday moments in exceptional experiences / Target Highend Men and women / Emotional Benefits Trust Gratification Surprise
8 OUR POSITIONING Santa Isabel exists to make everyday convenience promise come true for customers with the seal of Cencosud quality / FUNCTIONAL BENEFITS CONVENIENCE - Quality in products and infrastructure - Physical and emotional closeness - Competitive prices with the best promotions - Promptness, ease purchase process and express checkout / TARGET Extended middle class women (C2C3D). DIFERENTIATION Everyday convenience, with the seal of Cencosud quality / BRAND PERSONALITY Santa Isabel is cheerful, feminine, close and current. It is a reflection of Chilean middle class women: with a strong practical sense, always ready to give the best to their own. A woman seeking convenience, but without leaving quality apart. / EMOTIONAL BENEFITS Savings Coverage Identification
9 3 Growth
10 1. Organic Growth: We plan to open new stores in the format of Supermarkets and Hypermarkets Growth in upcoming years will be leveraged in: Valdivia Viña del Mar La Serena Independencia Arica
11 2. SSS Growth: Remodeling New image and layout Jumbo La Reina, Santiago
12 2. SSS Growth Remodeling New image and layout Santa Isabel, Claudio Vicuña, Quilpué
13 2. SSS Growth: Remarcable Campaigns Leading the shopping experience Products Availability Self-service products Express check out Personalized promotions Jumbo commitments
14 4 Efficiencies & Profitability
15 1. Centralization of productive processes: Bakery Pasta Prepared Food We continue to seek efficiency initiatives that allow us to operate our business with lower costs and higher profitability
16 1. Centralization of productive processes : Bakery Pasta Ready Meals We continue to seek efficiency initiatives that allow us to operate our business with lower costs and higher profitability
17 1. Centralization of productive processes : Bakery Pasta Ready Meals We continue to seek efficiency initiatives that allow us to operate our business with lower costs and higher profitability
18 2. Logistics processes: New perishable DC has a storage capacity of 162,575 boxes and a sorter that can move 90,000 boxes per day, from a total flow of 120,000 boxes Launch of new Perishable DC Implementation of Unit picking Warehouse Consolidation
19
20 The new perishable DC will have an exclusive rest area for truck drivers
21 3. Inter-business negotiations: Safety, cleanliness, shipping freightage, among others Efficiency & profitability 4. Plans for underperforming stores: Closed stores and evaluation process for the closing of other stores Significant profitability improvements in under performing stores Cluster Mix Layout Sub-formats developments Specific promotional activity
22 5 Omnichannel
23 Permanent focus on Omnichannel, to continue to lead 1. Up grade web platform
24 With our new App Mobile, another channel is opened on our Omnichannel strategy 2. Launch of our Mobile App
25 With our new App Mobile, another channel opened on our Omnichannel strategy 2. Launch of our Mobile App
26 3. More and better services Click and Collect (5 stores + 16 new stores), Drive Through (4 stores + 14 new stores) We continue to offer the best Omnichannel experience to our customers
27 3. More and better services Click and Collect in Lockers, located in gas stations, subway, residential sectors, etc. In the last quarter 2016, we will implement the click and collect in lockers at 4 locations outside our stores
28 3. More and better services Shop at the store and Home delivery (4 stores), anytime of the day, 90 minutes after passing through express checkout Pilot delivery in 2 hours More flexibility for our customers Before Now
29 6 Customers and Society
30 3 Pillars define our actions We will continue working on being active brands on business development, in a sustainable way Quality of life Environmental innovation Conscious supply
31 Quality of life Campaign Cook with all: Education to customers to avoid waste Leaders in working on sustainable business More parks for Chile: to growth in Green areas and improve life quality of our neighbors Campaign Eat Healthy: Healthy eating Program Free From: Product development of specific food needs
32 Environmental Innovation Portal Rancagua: 1st store in Chile with a 100% of renewal energy Leaders in working in a sustainable business Clean points development in our stores Save energy consumption and carbon footprint program Incentives to use reusable bags to our customers
33 Conscious Supply Working program for small suppliers for the development of differentiation products Leaders in working in a sustainable business Best practices certification for our private label products Lower environmental impact certification at FFVV products Work in conjunction with small suppliers to provide preferential payment terms
34 We thank our customers and collaborators, the recognition of our management as a leader Supermarket chain in Chile Prohumana Jumbo one of the 9 more sustainable companies in Chile Mutual de Seguridad Recognition to Santa Isabel Corporate Reputation (Reputación Corporativa) Jumbo the only distinguish supermarket Procalidad Prize Jumbo 1 Place Satisfaction Customers Supermarkets Lealtad Prize Jumbo 1 category in supermarkets Plenus Prize Recognition to Jumbo for employing the elderly
35 THANK YOU!
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