A chain with 330 stores in the South of Brazil expects revenue of R$1.7 billion in 2022
“Each company has to act in it’s niche and format.” -Otelmo Drebes
A retail chain with 330 stores in the South of Brazil expects revenue of R$1.7 billion in 2022. This October, Lojas Lebes celebrates its 66 years as one of the main retail chains in southern Brazil. Founded by Otelo Drebes, in 1956, in the city of São Jerônimo, countryside of Rio Grande do Sul State, it began its trajectory as a small retailer of food products. Today, it is present in more than 290 cities in the states of Rio Grande do Sul, Santa Catarina and Paraná and presents great numbers: it has 330 stores, 3 thousand
employees and 1 million active customers registering a growth of 15% to 20% per year. In 2022, the expected revenue is R$ 1.7 billion.
The development took place with a professionalized family management and corporate governance practices. In 2015, the founder handed over the command of the company to his son Otelmo Drebes, who invested in technology, consolidated new businesses, increased capillarity, and accelerated the integration between the physical and online channels. “One of the biggest challenges
in retail is to keep up growing. In our case, the biggest challenge is to be able to differentiate ourselves with the customer in terms of service, variety of products and speed of delivery”, says the president of Lojas Lebes in this exclusive interview for Eletrolar News.
How do you define Lojas Lebes?
Otelmo Drebes – As a modern and advanced company that pays everything on time. We go through all economic plans; we don’t have any rental issues and we don’t fight. We have been working with the same suppliers for over 20 years. We are traditional, correct, very modern and innovative. We are very close to the consumer, aiming at their loyalty. Loyalty is difficult, as the consumer always looks for the cheapest one first.
“Each company has to act in its niche and with its format. We have plans for a more expressive number of stores in Santa Catarina and, also, to go further in Paraná. Lebes is big enough to serve the states of Rio Grande do Sul, Paraná, and Santa Catarina well.”
How does the company retain its consumer?
OD – With a total focus on the customer, Lebes invests heavily in omnichannel to make the consumer increasingly protagonist in their purchase journey. Thus, he buys what he wants, in the physical store or at Lebes digital, pays as he wants and picks up or receives wherever he prefers. In order to truly meet all needs of the client and his family, the group is formed by a complete ecosystem aimed at exceeding all his expectations, not only in terms of products, but also services that make his day to day easier.
What are these services?
OD – These are financial services such as personal loans, family and home insurance and easy access to doctors with Chama Doutor, a telemedicine platform. Lebes Financeira is a company authorized by the Central Bank, audited by KPMG, which enables the autonomy of the entire chain to manage the business, without depending on third parties, from credit analysis to collection, if
necessary.
In which other areas does Lebes operate?
OD – We also operate in the clothing industry with our own brand New Free. The factory, located in São Jerônimo (RS), produces more than one million pieces per year, sold exclusively in the chain’s stores. We also have an administrative center in Eldorado do Sul (RS), in an area of 2 thousand sqm, and a logistics center, with 19 thousand sqm, in the GPL Logistics Park, in Gravataí (RS). In this way, Lebes’ ecosystem is fully aligned with our purpose, which is to facilitate people’s access to their dreams.
What is the network’s differential in its market?
OD – Lebes is one of the largest retailers in the South of Brazil and stands out for its close and personalized service, both in the experience in physical and digital stores. With the slogan “Dress you, dress your home”, it offers a complete and varied mix of products in fashion lines, footwear, accessories, bed, table and bath, furniture, home appliances and technology. Thus, the customer finds everything he needs for the family and for the house in just one place. Another differential is the ease payment, which, through Crediário Lebes, offers exclusive conditions with installments that fit in our client’s pocket.
“From now on, it will be necessary to live with the issue of vertical sales. In the case of physical and online stores, there will be accommodation, not least because one complements the other.”
Did the pandemic leave lessons?
OD – Yes, we saw how much faster we need to adapt to situations, how much more productive, skillful, and quick we need to be. We also saw the importance of credibility and structuring to get through difficult situations more easily.
How many types of stores compose the network?
OD – There are 330 stores distributed in the states of Rio Grande do Sul, Santa Catarina, and Paraná. We work with two types of stores, those with 1,000 sqm, which operate in the hard line, that is electronics. The others work with the soft line, that are clothing, footwear, and bazaar. In recent years, we have opened compact stores, measuring up to 150 sqm, digital and with a smaller mix of products. Today, we have over 1 million active customers and 3,000 employees.
How is the electronics segment performance?
OD – Sales of furniture and electronics account for 70% of sales.
What is the revenue forecast for this year?
OD – The expectation is to reach R$ 1.7 billion, a good number for a company of our size.
Is it difficult to be a retailer in Brazil?
OD – The retailer is a surviving hero due to the difficulties it faces, such as competition, demands and taxation. However, the presence of Brazilian businessmen at the NRF, which takes place annually in New York (USA) is by far the largest. They go in search of innovations in technology and new products. Brazilian retail does not lose anything to anyone from another country.
Why is the discussion on tax reform so long?
OD – Everyone is in favor of the reform, but who will earn less? Will the entrepreneur have to pay more? The question about tax reform is who will give up what.
How do you evaluate the performance of Brazilian retail in 2022?
OD – The situation this year has been very challenging, especially due to political uncertainty and financial instability. To improve the situation, the expectation is to reduce interest rates, increase consumer confidence and maintain inflation at the projected rates.
What are the biggest retail challenges in the coming years?
OD – One of the biggest challenges in retail is to keep growing. For this, Lebes continues to invest heavily in technology and digitalization to facilitate the customer journey. It is also necessary to be creative to attract and retain the consumer, since the products and prices are very similar. Today, we have regional companies serving the places where national companies do not enter. In our case, the biggest challenge is differentiate ourselves with the customer in terms of service, variety of products and speed of delivery.
How is the company’s logistics?
OD – We have a logistics center in Gravataí (RS), with 19 thousand sqm, in the GLP Logistics Park, which supplies all stores. The distribution oversees Intechlog. It is an outsourced fleet, and products are delivered within 24 hours.
“We have avoided opening stores in shopping malls because the cost is too high. Today, the middle lass is more likely to shop in street stores. A store in the shopping mall, which opens from 10 am to 10 pm, needs to have more employees, which doubles the cost. We have a few more traditional stores in malls.”
Does the company have plans to go forward to other regions of the country?
OD – Each company must act in its niche and with its format. We have plans for a more expressive number of stores in Santa Catarina and, also, to go further in Paraná. We want to get faster to the customer. Lebes is large enough to serve well the states of Rio Grande do Sul, Paraná, and Santa Catarina. We don’t think about going to other regions of the country.
When did the digital transformation start in the company?
OD – In 2017, we were the first in Brazil to implement the German SAP system, aiming to facilitate consumer experience. We invest R$ 10 million in technology/year.
How do you see the competition between the physical and online store?
OD – From now on, it will be necessary to live with the issue of vertical sales. In the case of physical and online stores, there will be an accommodation, not least because one complements the other. For example, those who already know all features of a cell phone will buy it online, but the physical store, in turn, has affection and service. It is an experiencing point, a place to look at and test products.
Does the company work with marketplace?
OD – We have a marketplace, but it’s not the company’s focus. It is not advantageous; the profit is very low.
As negociações estão mais difíceis atualmente?
OD – Negotiation is more difficult because the supplier wants to charge more, and the other party wants to pay less. It’s no use going into a war, dialogue is needed. Today, industry and retail are closer.
What is better? Shopping Malls or street stores?
OD – We have avoided opening stores in shopping malls because the cost is too high. Today, the middle class is more likely to shop in street stores. A store in the shopping mall, which opens from 10 am to 10 pm, needs to have more employees, which doubles the cost. We have a few more traditional stores in malls.
“Lebes is big enough to serve the states of Rio Grande do Sul, Paraná and Santa Catarina well.”
In these 66 years what were the biggest consumer transformations?
OD – Consumers have become more demanding, they want more agility and more facilities, such as paying with two credit cards. He wants to buy and withdraw the product wherever he wants.
What do you expect from 2023?
OD – Regardless of who wins the election, there will be greater development and more investment. I believe in growth in the year 2023.
Source: Eletrolar News #151
