Retail giant Dollarama expands network into Latin America
Posted February 5, 2013 10:21 am.
This article is more than 5 years old.
The Canadian discount retailer giant Dollarama has entered into an eight-year agreement to help the Central American chain Dollar City expand its network of stores and provide more products for sale.
The Montreal-based company won’t take on operational responsibilities or make a capital commitment, but could eventually acquire a majority interest in the chain.
“Dollarama is as much an importer as it is a retailer. Our business isn’t just based on growing our network of stores; it’s also based on the continued development of our low-cost direct sourcing platform,” said Larry Rossy, Chairman and CEO of Dollarama.
The terms of the agreement say Dollarama will share its business and operational expertise with Dollar City as well as leverage its direct sourcing and importing expertise to provide their growing network of stores with a compelling product offering.
“Dollarama’s unique dollar store concept and compelling product offering continues to be very successful with Canadian consumers. Our objective is to test the potential of the Latin American market in a way that minimizes risk, capital and time investment and we believe that we have found the right strategic approach and the right partners to achieve this,” added Mr. Rossy.
The retail landscape in many regions of Latin America, including Central America and Andean Pact countries, is increasingly modern, with a growing presence of global retailers with global brands.
Despite the presence of many global retailers and a retail landscape similar to North America’s, the dollar store market is underdeveloped and underserved, providing for significant growth potential.
“This collaboration with Dollar City will provide us with a timely window and a strategic entry point to participate in the long-term potential of this dynamic emerging market,” Rossy said.
“Furthermore, we believe that our product offering can be easily adapted to appeal to local tastes as well as offer consumers tremendous value,” Rossy added.
