2021 PRESIDENTS SPECIAL INTERVIEWS
Economic recovery depends on more stability, reforms and vaccination.These are the pillars that the leaders of the electronics industry consider the basic principles for Brazil to move forward.
By Leda Cavalcanti and Dilnara Titara
The abrupt halt in activities caused by the pandemic in 2020 put obstacles that seemed insurmountable ahead of all sectors, precisely in a year that had started reasonably well, with an 8% increase in sales of home appliances and electronics by the beginning of March. With the stores closed and a climate of near inertia, the segment went to the fight with agility and creativity.
Retail accelerated e-commerce, expanded the product mix and created support actions for those unfamiliar with the platform. The industry used its director channel to communicate with the consumer. If he could not reach them, both moved towards him, facing the well-known challenges of the Brazilian logistics network. There were losses, it is true, but the actions contributed to making the scenario less impactful.
Now, strategic planning is urgently needed to recover the economy. Measures such as emergency aid helped to ease the situation last year, injected resources into the economy, but there are no conditions to make them permanent. Palliative actions are useful at any given time but, advances necessarily involve mass vaccination of the population. It is she who will dictate the pace of the resumption.
Brazil needs a consistent agenda, with the inclusion of long-awaited reforms, such as the tax since the current system hinders growth and productivity. There are countless problems to be solved and many uncertainties. The country needs to be faster and offer greater stability so that 2021 does not become another year of multiple challenges.
The Pernambuco distributor specializes in home appliances and is active in the Northeast. Its goal is to grow in 2021, says the president. “We work to achieve it, but the loss of purchasing power can affect us.”
The challenge today is to guarantee the supply of the main products without compromising revenue, says Sebastião. “In the distribution, the line between positive and negative results is always very thin. We don’t have our own brand.”
“In the distribution, the line between positive and negative results is always very thin.”
Unlocking the reform agenda is necessary, but in the short term, emergency aid helps, says Sebastião. “The dollar rate, coupled with the scarcity of inputs and high steel prices, hit the backbone of the segment.”
Expectations are of significant improvement by the second quarter, considering the progress of immunization and supply regularity, says the president. “Retail and industry started 2021 with low stock levels and with the dollar impact. E-commerce has become more relevant; we’ve improved efficiency in internal processes and have implemented upgrades in store experience. These, added to the GDP increase forecasts, even if minor, make us believe in a better year than 2020.”
In other crises, the Country’s economy has displayed a great ability of recovery and it should not be different now, tells Teruo. “Brazilians won’t stop consuming. Some aspects that have helped speeding up the economy refer to improvements in the tax and administrative reforms. Dollar oscillations also reflect on operational costs. Equipment, software and tools used are, in some form, subject to cost oscillations due to the currency.”
“Market attention and the perception of opportunities are essential to our success.”
Fujioka wants to accelerate in 2021. “Market attention and the perception of where we could have more opportunities are essential to our success. In the distribution channel, we’ll invest heavily in technology and logistics. In retail, we’ll continue to optimize stores with greater sales potential, and we will search for consistent expansion opportunities”, says Teruo.
The company expects a higher revenue in 2021, says the director. “Despite 2020 being atypical, we’ve managed a nice recovery and ended the year with positive results. In 2021, the expectation is for a 25% growth in revenue over the previous year. We will have many releases in our lines, such as audio, wearable tech, and connected homes. The implementation of new segments is part of our strategy, which we intend to display at Eletrolar Show.”
In the economy, Rafael observes that after January being eventful, he sees a more favorable environment for some issues at stake for a long time. It’s the case of the tax reform, at least in the sense of streamlining. It’s the surveillance of brands that operate irregularly.”
“In 2021, the expectation is for a 25% growth in revenue over the previous year.”
Today, differently from the past, a large portion of the company products is imported, and there’s direct dollar influence in pricing. “We are mitigating as much as possible significant increases, in such a way to find alternatives to keep our products with quality and prices compatible with the Brazilian market. The company seeks, through financial tools, to maintain an average dollar to work with greater peace of mind or, at least, within a threshold for a period, so as not to experience high oscillating increases and reductions.”
The company’s expectation is positive for 2021, says the CEO and president. “We expect a minimum growth of 100% in revenue compared to last year, when, even with the pandemic, we obtained excellent results. With the news that we will have this year, the revenue, for sure will be higher than 2020.”
In the economic area, Monique says that the sector in which the company operates is doing well but makes a reservation. “We need a lot of attention on the issue of taxes, especially in the IPI, to stimulate sales growth.” The dollar has a direct influence on products. “The brand is international, but as we have a good inventory schedule, we managed to hold the value in the pandemic.”
“We will have many launches and a new accessories brand, which is a partner of our iMonster, in the United States.
This year, the company is fully focused on digital growth, customer service, marketing and the new e-commerce site. “We will have many launches and a new accessories brand, which is a partner of our iMonster, in the United States. Our batteries will be approved by Anatel for greater security for customers, technical assistance and franchises”, says Monique.
The feeling is of optimism and higher revenue before 2020, says the president. “Due to the closing of the brick-and-mortar stores, our sales were very concentrated in e-commerce, but with the return to normal economic activities, although slow, we expect to grow and return to pre-pandemic sales volumes.” In the plans for 2021, there is an increase in the supply of “small appliances”, such as a pizza oven, mixer and blender, and a greater presence in some markets. Not long ago, Nagem opened another store in Salvador (BA).
Today, success depends on administrative and tax reforms, which urgently need to be carried out, are fundamental to the country’s economic growth. Otherwise, we will have major problems, says Halim. “The most consistent solution is to mass vaccinate the population. This is what will recover the economy, jobs and income.”
In the plans for 2021, there is an increase in the supply of “small appliances” and a greater presence in some markets.”
Living with the dollar fluctuation already had an impact on consumers. “There was a loss of purchasing power. The high appreciation of the currency affected all social classes. The prices charged were impacted by up to 30% on the consumer at the end. How will he react? We are competing with other items in the families’ priorities, such as food, school and health. This affects not only our sector, but the entire economic chain”, observes Halim
The company expects to grow above double digits this year, says the director. “The pandemic has increased demand for our products. Before, the home desktop was for the family, but in 2020 more devices were purchased and also notebooks and tablets. In addition, many upgraded their devices they already owed. We are investing heavily in new products, a team of professionals, and a new system, preparing for this growth.”
The year 2021 started well for Newex, says Marcelo. “In this quarter alone, there were dozens of launches in the categories of audio, kids, games and in the Oex Enjoy line. We will have more releases this semester and we will reinvigorate existing lines, which is always valid for successful items. We are also structuring the team, with more trained professionals and a new bi-weekly program recycling our products technical content.”
“In this quarter alone, there were dozens of launches in the categories of audio, kids, games and in the Oex Enjoy line.”
At the beginning of the year, the economy is at a standstill, but it should improve as of May, says Marcelo. “The most important thing is that there are no layoffs nor a decline in GDP growth estimates.” Of the company’s products, 90% are imported, therefore, affected by the dollar exchange rate and international freight. Currently, what is most concerning, is the increase in the price of commodities. “This has a direct impact on the prices of our products,” says the director.
The company expects the recovery of economy, even if slow paced, says the CEO. “We believe that sales will increase along with the market rising. We have a complete product lineup, and news shall come in 2021.”
Among them, chargers and music lineup, tells Jeferson. “The diversification of accessory lines for the Apple market is our DNA. Our goal is to expand the mix and work with other renowned brands in the market.”
“We have a complete product lineup, and news shall come in 2021.”
As it works with imports, the dollar directly affects the company’s business, with an immediate impact on the price of products. However, its customers realize the brand’s added value. “We care more about the user experience than about other factors,” says Jeferson.
2020 was an excellent year for Oderço, says the CEO. “The growth target was 40%, and we reached more than 90% compared to 2019. We sell chairs, computers and accessories. We grew with the demand generated by the pandemic. In 2021, it is possible to grow more.”
Earlier this year, it expanded the Geek category by bringing the Funko leader to its collectible portfolio. The Pcyes brand, which focuses on the PC gaming segment, is the flagship. It also enters the solar energy sector and will bring new products with investment in technology.
We grew more than de 90% compared to 2019.”
The appreciation of the dollar, however, affects the company, says Matheus. “It is notable that premium products sell less and are replaced by entry items because the Brazilian’s income remains the same, which
reduces their purchasing power.”
It projects a more stable year, with growth, says the marketing director. “It is part of the company’s DNA to dare. In 2021, we will release our online Rcell Store, a B2B platform, which will take our products to the most remote regions of the country, with automated sales, order tracking information for the customer, and better tax models. It will also diversify the portfolio, including of its own brand of smart products Rsmart.”
“We will release our online Rcell Store, a B2B platform, which will take our products to the most remote regions of the country.”
The world industry is still recovering from the vacuum left by the pandemic, and production is expected to normalize as of the second half. “We are betting on the country’s growth projection in 2021, between 3.5% and 4%, but Brazil needs to move forward with reforms, especially tax reform, with the unification of some taxes”, comments Alexandre.
lower and less volatile exchange rate would favor imports and exports, says Alexandre. “With a volatile dollar and a devalued Brazilian real, the risk is huge of being in the red, in operations that the distributor imports directly, as in the case of its owned label products and video game consoles; since there is a huge gap between cash advanced and receivables by the retailer. In items imported directly by the industry, such as smartphones, the impact is smaller.”
The company is preparing to expand and surpass the 2020 results, which were already excellent, tells the Brazil country manager. “With the progress of vaccination against Covid-19, the year of 2021 will be of economic recovery. We hope the dollar to fall back to a much lower level, allowing imported products to arrive to consumers with a more affordable price.”
Dollar is one of the main factors the company considers for its business since it determines sale prices. “Its instability leads to more conservative strategies, and our distributors try to make imports with short-term stocks to prevent losses. Most importantly is that the currency’s high value leads to price increases, and this hinders sale results”, says Rafael.
“The company is preparing to grow and surpass the results of 2020.”
This year it will release accessories for the new generation of consoles, PlayStation 5 and XBOX Series, with modern, quality design and affordable prices. “With the trend of home office, we will also boost our Brazil catalog of webcams, mice, microphones, keyboards, headsets and office furniture”, tells Rafael. Within the expansion plan, it will change to a larger site, ensuring better operation conditions.
The company expects good sales performance in 2021, says the CEO. “Our solutions are essential to the areas of telecommunications, internet providers, healthcare/hospital, e-commerce, logistics, commercial and residential security systems. The expectation is to grow about 10% in relation to 2020.” This year, the company expects advances in administrative and tax reforms.
Even with the pandemic, sales of home appliances remained heated in 2020, recalls Pedro. “Especially due to the mass adhesion to electronic commerce, reaching other niche markets and increasing the sales ticket. The next step will be to look for the most effective ways of interaction with customers to ensure that demands are met, and the entire sales cycle is put into practice, without dropping the quality of service.”
“The company’s expectation is to grow about 10% compared to 2020.”
One adversity that marked 2020 was the constant fluctuation of the dollar, says Pedro. This ended up affecting the price correction and the import of inputs to maintain production, a scenario that was not seen in the last 19 years. “We try to remain creative in order to define medium and long-term strategies to reach the goals and serve the most varied niches that needed safe and uninterrupted energy.”
USINA DE VENDAS
The company is growing at a fast rate since its entrance in the smartphone distribution market, in 2017, says the president. “We understand there is still room for growth. Thus, our expectation for 2021 is to remain expanding even with the pandemic scenario. Vaccination needs to be speed up for the population remain safe, and thus, we avoid new lockdowns, which still haunts retailers.”
For Marco Antonio, Brazil urgently needs reforms, such as the tax reform, to develop itself in all areas. “The high dollar, on its turn, makes technology products more expensive since, even if produced locally, most part of the inputs are from abroad. We are systemically affected, exchange rate oscillations corrode and reduces the market and business opportunities.”
“Our expectation is to continue expanding in 2021, even with the pandemic scenario.”
In 2021, according to the president, the plan if to strengthen the partnership with TCL Mobile, whom the company is the official distributor in Brazil. “We have already released six smartphone models in the market and, this semester, we will release a tablet family for the education and corporate sectors. In parallel, we will keep the focus on increasing sales in alternative channels of the Samsung wearables line, whom we are official distribution partners”, tells Marco Antonio.
2020 brought challenges, says the analyst. “We faced difficulties in imports, restrictions in the economy and a slowdown in the market. But they helped us to see the market differently and focus on what is best for the consumer.”
The company trusts in the recovery of the economy. “The consumer is aware and looking for greater value in the goods he buys. We are focused on this profile to increase revenue by added value”, says Fábio.
“In 2021, the big news will be in home audio and personal audio.”
In 2021, the company expects a better exchange rate policy. In launches, the big news will be in home audio and personal audio, with speakers and headphones. “We also turned our attention to the games market,” says Fábio.
Source: Eletrolar News Magazine #141