What is Grupo BIG doing with the Walmart portfolio in Brazil?

Date : 10 December 2019

Oliver Butterworth

Retail Analyst

In June 2019, private equity business Advent International acquired an 80% stake in Walmart’s Brazil operations. Walmart maintains a 20% stake in the business, which has been renamed Grupo BIG. In early 2019 it announced its plans to invest BRL1.2bn (US$287m) into modernising and expanding stores over its first 18 months. For more information on the acquisition see our article.

Rebranding and remodelling stores

Grupo BIG currently operates stores across seven banners, some of which are being rebranded. The business has retained Walmart’s approach to having regional banners, with only slight variations to its already distinguished brand names. Hypermarkets in the south, southeast and midwest will be renamed BIG, and in the northeast, they will be called Big Bompreço.

Christianne Rego, CMO of BIG Group stated “We want to win the hearts of consumers and make them feel that the change in brand really reflects a new momentum for the company. Restructured stores, a more consolidated sales strategy and a wide range of products will support us in building this new brand”. By June 2020, the business aims to have remodelled 100 of its hypermarkets.

Source: Grupo BIG website

The business also operates two supermarket banners (Bompreço and Nacional), a neighbourhood supermarket (TodoDia), a cash and carry (Maxxi), and Sam’s Club, which will retain Walmart’s original branding. Its heavy mid-term investment involves the expansion of the Maxxi and Sam’s Club banners.  

Increased investment in cash and carry

Prior to Advent International’s acquisition, Walmart operated 43 atacarejo’s (cash and carry stores) under its Maxxi Atacado banner. 10 of these were conversions of underperforming Walmart hypermarkets. Grupo BIG is remodelling all these stores to a more modern design, which will make it more competitive in the market. 38 will have been remodelled the end of 2019 and the final five will be completed in 2020.

On 28 November 2019 Grupo BIG opened its first Maxxi store in São Paulo and a second will be open in the city by the end of the year. This demonstrates Grupo BIG’s confidence in expanding the banner in major cities. Including the two openings in São Paulo, it aims to open 10 stores by the end of 2020, taking its total store numbers to 53 under the Maxxi banner.

Evolving the Maxxi proposition

As before, the proposition serves both small-to-medium sized businesses and individual customers. This is reflected in its new slogan “Come to Maxxi. Good for your business. Good for you.” The product mix includes a varied assortment in food, beverages, butchers, cold cuts, dairy products, frozen, hygiene and cleaning products. Grupo BIG’s strategy for the banner focuses on providing greater innovation, improved customer service, lower prices, and an expanded assortment.

Maxxi stores are roughly 3,300 sq. m and stock between 4,000 to 6,000 SKUs. The layout of the store has been revised and the product assortment has been increased by around 40%. The range incorporates a larger number of regional products. The checkout area has been made bigger, with 24 checkouts, to better facilitate high traffic and larger trolleys. The new visual identity of the Grupo BIG brand extends to its Maxxi stores. Its red façade now features a distinctive bold ‘X’.

Source: Grupo BIG website

Beto Alves, Executive Director of wholesale at BIG Group said; “The atacarejo format has gained a lot of momentum in recent times and we see great growth potential by repositioning the brand with a differential in assortment, price, service, self-service and shopping experience, focusing on all audiences, from small to large commercials and end consumers.”

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