Guatemala is one of the Central American countries where Walmart plans to invest $700 million over the next five years. The announcement was made official on May 22, 2024 during the groundbreaking of the new Walmart design in Naranjo, Mexico.
Barbara Viñales, Regional Director of Super Formats for Walmart Central America and Country President for Guatemala explained. Free Press Short and medium term investment projects.
What is Walmart’s path in Guatemala?
Walmart entered Central America in 2005, where in Guatemala it acquired the Pies and Hyper Pies supermarket chains, as well as the Despensa Familiar and Maxi Despensa brands.
Between 2011 and 2012 we transferred the Hiper Paiz brand to Walmart, and it was launched in a store in Honduras, where a full pilot project for this evolution was carried out, and then to the rest of Central America.
In these two decades, what is the current balance?
We currently have 263 stores and work across four formats. Of supermarkets, there are 27; From Walmart, 10; family pantries, 181; and Maxi Despensas, 45.
In the Guatemala operation we have three plants from which fruits and vegetables are distributed, meats and a bread plant from which products are sent to each of the stores; Two distribution centres, one for groceries and the other for general goods and textiles, with central offices in Zone 10 of the capital.
What is the profile for each format?
Family pantries have few resources for socioeconomic status, and you’ll find very basic items and some brands; Then there’s Maxi Despensas, which has the same prices as Family Pantries, but with a wider range of consumer products and a wider range of white goods brands.
“Typically, stores are remodeled every 10 years and all the new technology like solar panels are incorporated and upgraded, and investment is made in the current infrastructure.”
Barbara Vinals, Regional Director of Super Formats, Walmart Central America
The Walmart format caters to a wide range of socioeconomic levels from A to D or E, so we have a design with a wide range of assortment where all products and services are found in one place.
The supermarket is for medium and medium high socioeconomic status, where our strength is perishable products, so fresh fruits and vegetables of the best quality and a wide assortment with a very diverse menu for customers.
With the opening in Naranjo, it will be the 11th Walmart format with additional services such as in-store remittance and financial services or general services payments.
Typically, stores are remodeled every 10 years to incorporate and upgrade all the new technology, such as solar panels, and the recently announced new investment will see little investment in existing infrastructure.
What is the expansion plan for the next five years in Guatemala?
An investment of US$ 700 million has been announced, which includes existing infrastructure and the redevelopment of our group stores. We will invest in technology, new applications for our store associates and corporate customers to speed up self-checkouts and avoid waiting in line. In addition, there is expansion of new stores and expansion of logistics chain.
Therefore, this US$700 million will be divided into these items over the next five years.
What is the plan for expansion of new stores?
We don’t have an exact number at the moment, but we’re going to grow into our four formats; Where we’re going to find opportunity, we define design that’s consistent with that community and demographic, but it’s a sustainable project.
With this, we want to be very close to the communities we don’t operate in today, and we can get to where we need to be at a lower cost.
It’s a very tangible thing for our customers and even if that whole logistics and technology network isn’t realized by buyers, it helps us support that growth.
In the production and distribution logistics chain, what is going to be done?
In manufacturing plants, we currently still have capacity that we plan to continue to grow; The area we value is the grocery and consumer distribution center because we will be short on investment plans that we have.
Therefore, it could be an expansion of the existing distribution center or building a new one, which are options that are still being evaluated.
We are also growing E-commerce Through this we are attracting new customers and need improvement in logistics infrastructure.
What investment projects are expected by the end of 2024?
We’ll have a new store opening in November (Walmart El Naranjo) and another group of Despensas Familiars and Maxi Despensas stores coming up, as well as remodeling.
For example, the most symbolic store for customers is Walmart Villa Nueva, which is more modern and attractive to shoppers.
I understand that this is a very serious project…
It will be more aggressive in the next five years and we are looking for more places to invest, but we are very dependent on permits.
What is the perception of the business climate in Guatemala?
Of course, Guatemala is a very stable country financially, which gives the company a lot of security to make these investments. So, we see Guatemala as the whole of Central America, with a bright future.
In your analyses, what were the key changes you analyzed in consumers?
It depends on the socioeconomic level, but when talking about something broader, i.e. people with limited resources, they are looking for more places to buy. That is, they invest more time, but they need to save and they mainly spend three to five places to buy their food.
We strive to make sure you don’t have to travel, spend in transit, or walk several blocks to find what you need. High socioeconomic status is very demanding and can visit many supermarkets, so we are demanding in our level of service, delivery and quality of products.
A Perspective on Walmart Central America?
The future of Walmart Central America is similar to Guatemala and plans are being made for five countries in the region. In the short term we are going to focus on opening stores and expanding this logistics network; In media, continue this expansion and continue to find the right spaces for each store segment.
