Argentina: Distributing a product

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Distribution

Types of Outlet

Hypermarkets and supermarkets: Located outside the city centres, supermarket outlets sell food and other products. They usually offer the lowest prices.
Carrefour, Coto, Jumbo, Yaguar, La Anonima, Libertad, Cencosud, Disco
Small supermarkets with a small range of products: Located in the city centres, sell food and other first necessity products. Higher prices
Carrefour Express, Mini Libertad
Small traditional shops (locally called “chino”): A type of a 'mini-market' located throughout neighbourhoods and in Buenos Aires downtown
Small shops that sell one specific line of product: In each neighbourhood there are several small shops that specialise in one line of product. They are bakeries, butchers and cheese shops.
Traditional markets and street markets: A type of outlet which sells fresh produce, usually fruits and vegetables.
Mercado San Telmo, Mercado del Progreso, Feria de Mataderos
Shopping centres: Malls are usually located in town and have several stores inside. They usually sell clothing, but they can also sell shoes, accessories, books, electronics and food.
Galeria Pacifico, Abasto Shopping, Galeria Alto Palermo
Department stores: These stores offer a wide range of products, such as clothing, shoes, accessories, bedding, furniture, jewellery, beauty products and houseware.
Falabella
Specialised stores: Stores that sell only one line of product. The most popular ones are the ones that sell office supply and building materials.
Staples, Teorema, Sodimac
Wholesale stores (known locally as 'Hard discount'): These outlets mainly sell food with discount prices. They usually don't sell brand name items.
Walmart

Evolution of the Retail Sector

Growth and Regulation: Argentina is the second-largest economy in South America in terms of nominal GDP, with 46.2 million inhabitants in 2022 (INDEC), and a GDP per capita (PPP) estimated at 20,770 USD in 2020 (World Bank, latest data available).
According to INDEC, in 2021 supermarkets recorded a 1.5% increase in sales (constant prices), as a consequence of continued urbanisation of the population (92.3% in 2022, according to CIA's Factbook). During the first two months of 2022, sales increased by 5.4% year-on-year.
Argentina's retail formats under 500 m2 perform slightly better that the larger ones.
In recent years, nearly all retail formats have been increasing in number: supermarkets, wholesalers, traditional grocery stores, and shopping malls. However, the Argentinian retail market continues to face certain challenges such as high operating costs, inflation, bureaucratic barriers, and high taxes. Furthermore, the supermarkets channel has been affected by the economic recession, resulting in the closure of branches. As a response to consumption contraction and the decrease in consumers' purchasing power, bigger chains have been further developing private labels, which is expected to boost their sales, especially for food products.
Market share: A significant number of consumers prefer hyper and supermarkets, as they find them more convenient in terms of time passed on shopping and prices. During the last couple of years, traditional stores have continued to lose market shares to hyper and supermarkets as a consequence of their highly competitive prices and discounts.
Hypermarkets, superstores, and warehouse stores account for approximately a third of the Food and Beverage market (which accounts for more than 70% of total sales) (Ambito). The sector is very concentrated, with six chains representing 80% of the market. The main leaders are Carrefour, Cencosud (Disco, Jumbo and Vea),
Coto Supermarkets, Walmart (Chango Más), La Anonima and Dia (iProfesional).
Retail Sector Organisations: Camara Argentina de Supermercados
Argentinian Confederation of Medium-Sized Enterprises (CAME)

E-commerce

Internet access: Argentina has a population of 43 million and it is particularly young: more than 15% of the population is between 15 and 24 years old. Compared to its regional neighbors, Argentina has a higher level of income and a wider middle-class. Around 30 million of Argentines have internet access. An estimated 22.5 million persons use a smartphone and 16.8 million shop online. Google, Facebook and Youtube are the main visited websites while MercadoLibre, Latin America’s major actor in e-commerce, ranks at the fifth place.
E-commerce market: In 2017, retail e-commerce sales in Argentina amounted to USD 5.9 billion, a growth from USD 5.1 billion in 2016. The market has been growing steadily and is expected to reach USD 10 billion by 2021. Like in much of Latin America, e-commerce is really dynamic in Argentina. The country ranks third in Latin America in terms of e-commerce turnover, behind Brazil and Mexico, but is expected to enjoy the fastest growth in the region in the coming years. Among the key players of e-commerce in Argentina, MercadoLibre is undoubtedly the biggest. Launched in Argentina in 1999, this website is designed for selling and buying between individuals and is now the largest e-commerce website in Latin America. It offers the possibility for other sellers to have their own e-shop on MercadoLibre’s website. During the month of January 2017, it recorded 11 million unique visits on its website. At the second place was Ebay with 2.4 million visits. The other major e-commerce websites in Argentina are Amazon, Avenida (similar to Amazon), Garbarino (home products) and Fravega (mainly household appliances). Travel and booking websites are also popular in Argentina with online stores such as Despegar and Booking.com. Cross-border e-commerce was hampered for a long time through high taxation and other disincentives, but these measures have been progressively removed by the new government, in office since late 2015. As a result, Argentina is expected to become one of the fastest-growing markets for cross-border e-commerce in the world in 2018, according to Forbes.
Social media: In 2017, there were 22.9 million social media users in Argentina, a number expected to reach 25 million in 2021. Smartphone use is booming in the country, and in 2017 more than half of the total population had one. As in much of Latin America, communication is not made through SMS or phone calls but rather through communication apps such as WhatsApp and Facebook messenger. Although not user for communication, Youtube is also a key player in Argentina. However, Facebook is by far the most popular social media platform in the country, with 21.3 million users in 2017. WhatsApp, used by 16.3 million people, is the second most popular one and an essential tool for communication in Argentina. Other popular social media networks in the country are Google+ (14.2 million users), Twitter (10.5 million users), Instagram (9 million users) and LinkedIn (6.7 million users). As of August 2018, the biggest social media platforms in Argentina by market share were Facebook (80.41%), YouTube (7.32%), Twitter (4.78%), Pinterest (4.71%), Instagram (2.46%) and Tumblr (0.17%).

Distance selling

Evolution of the Sector: The World Federation of Direct Selling Associations (WFDSA) shows Argentina's direct selling market grew 2.2% in 2017, USD 2.22 billion and involving 864,000 independent representatives. According to Euromonitor International, direct selling continued to grow in small cities in the interior of Argentina, representing 2/3 of direct sales. Many brands have opened stores to sell directly to consumers without the need of intermediaries.

WFDSA classified 2017 retail sales by product category as follows: cosmetics and personal care (72%); household goods and durables (20%); wellness (5%); clothing and accessories (2%); and home care (1%). Main direct selling companies also include Avon, Natura, and House of Fuller (with 20% of its sales derived from Fuller Cosmetics and 80% from the Tupperware brand. Other direct selling companies in Argentina can be found here.

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