Why this is important to Wisconsin businesses: Wisconsin exporters may find a variety of opportunities to market their products in the region’s retail stores and online channels.
Latin America’s retail industry is poised for strong growth. With expanding metropolitan areas, a growing middle class, and rising disposable incomes, consumers are buying more goods.
In particular, e-commerce is showing rapid growth, representing 9% of total retail sales in Latin America in 2023, with nearly 318 million people making online purchases valued at combined total of $168 billion. By 2025, e-commerce is expected to account for 15% of the region’s retail sales.
Here are specific market trends in four Latin American nations (Argentina, Chile, Colombia, and Peru):
Argentina: E-commerce is expected to reach $20.5 billion in 2024. With a compound annual growth rate (CAGR) of 8.55% between 2024 and 2028, it will likely increase to $28.5 billion in 2028, according to ResearchAndMarkets.com. The food and grocery retail market—which consists of household products, tobacco, food, and beverages—had total revenues of $76.3 billion in 2022, representing a CAGR of 49.8% between 2017 and 2022. The food segment accounted for the market’s largest proportion, with total revenues of $57 billion, or 75% of the market’s overall value. Argentina’s overall CAGR is expected to increase at least 4% over the 2022-2027 period.
Chile: The brick-and-mortar infrastructure is well-developed, with a modern network of shopping malls, including the Costanera Center in Santiago (the largest shopping mall in South America). Chile has one of the highest percentages of internet penetration in Latin America, with 94% of its nearly 20 million residents connected to the internet and using it on a regular basis, according to the Internet Society Pulse. E-commerce is projected to grow at a CAGR of 7.5% from 2024 to 2028, reaching an estimated $17.3 billion by 2028, according to ResearchandMarkets.com. Chile also has a long list of free trade agreements with major global economies, ensuring competitive import costs for consumer goods.
Colombia: In 2023, Colombia became the sixth-largest worldwide destination for U.S. agricultural products, according to the U.S. Department of Agriculture’s Global Agricultural Information Network (GAIN). Imports of consumer-oriented food products from the U.S. totaled $2.7 billion, and those goods represented 29% of all of Colombia’s imports from that sector. Food makes up the largest share of household expenditures (38%), and food processing represents 27% of Colombia’s total manufacturing. The imported food and beverage products that showed the biggest increases from 2022 to 2023 were beer, eggs, fresh vegetables, and pork products, GAIN said. Small, local grocers recorded 44% of consumers’ food-related expenditures.
Peru: The textiles and apparel sector is known for its high-quality fibers and innovative production methods. Peru is the world’s leading producer of alpaca fibers. Textiles generated $1.9 billion in exports in 2023, a 20% increase over the previous year, according to Texdata International. E-commerce sales are expected to reach $13.3 billion in 2024, up 8.4% from the previous year, according to ResearchAndMarkets.com. Brick-and-mortar stores continue to draw customers, as well. The $85 million Mall Aventura San Juan de Lurigancho opened in Lima in November 2023 with more than 250 stores and is expected to have 1.5 million visitors a month. Peru’s estimated retail CAGR is 4% from 2023-2027.
With increasing internet availability and smartphone adoption, traditional stores are encouraged to embrace e-commerce strategies, and to deliver personalized shopping experiences and customized offers to build sales and customer loyalty.
Wisconsin companies in the retail sector have a variety of opportunities in Latin America, both in traditional shops and via e-commerce.
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