This agreement does not affect the company’s operations. It’s normal life, with no impact on customers, suppliers and employees. On the contrary, cash flow relief gives the company more flexibility to negotiate with suppliers and take advantage of business opportunities that arise.
Renato Franklin, CEO of the Casas Bahia Group
Sector in crisis
The Casas Bahia Group is not alone. Recently, numerous renowned Brazilian commercial chains have closed their doors, entered into recovery processes or declared bankruptcy. The most prominent cases involve Americanas, Marisa, the supermarket Dia and the furniture and decoration chain Tok&Stok.
High interest rates are still an obstacle. Even with a reduction of 3 percentage points in the last seven months, the Selic rate is still a barrier for the sector. According to experts, the impact of the drop in the rate from 13.75% to 10.75% per year is still not very significant for the increase in purchasing volume.
Performance indicators have repeatedly shown the weakening of retail activities, especially the sale of durable and semi-durable goods. The interest rate at the top is mainly responsible for this condition.
Claudio Felisoni de Angelo, president of the Brazilian Institute of Retail Executives
The pandemic is remembered as one of the origins of the current situation. Industry analysts report that the social isolation measures imposed to slow the spread of the coronavirus caused consumers to migrate to the virtual shopping environment. The scenario coincides with a moment of expansion in the sector, when the Selic was heading towards 2% per year, the lowest level in history.
