Sales decreased by 25%, is Shein, Shopee, and AliExpress’s dream in Brazil shattered?
Did Shein, Shopee, and AliExpress's dream in Brazil shatter due to a 25% decrease in sales?
BusinessDialogue has learned that according to the latest analysis report released by the research team of Banco Santander Brazil (SANB11), the growth prospects of foreign e-commerce platforms such as Shein, Shopee, and AliExpress in Brazil are facing threats.
In April, the amount of goods imported from Shein and AliExpress platforms in Brazil decreased by 20% year-on-year, marking the first year-on-year decline since May 2020.
Compared with March, in April, the total amount of purchases made by Brazilian consumers on Shein, Shopee, and AliExpress platforms decreased by 25%, from 938 million reais to 700.9 million reais. In April 2022, the total amount of purchases made by Brazilian consumers on overseas platforms was 877.7 million reais.
SANB11 analysts Ruben Couto, Eric Huang, and Vitor Fuziharo pointed out that several factors, including a challenging macroeconomic environment and lack of attractive prices, led to this decline. However, in their view, the main reason is that consumers are worried that purchasing goods from other countries may be subject to taxation.
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BusinessDialogue understands that although the Brazilian government has decided to temporarily suspend the policy of taxing imported goods below 50 US dollars, international consumers are still highly concerned about e-commerce taxation. Due to concerns about cost increases, foreign e-commerce companies such as Shein, Shopee, and AliExpress are working hard on “localization”.
Shopee, which is owned by Singapore’s Sea Group, is trying to establish itself as a local platform that connects Brazilian sellers and users, similar to Mercado Livre. The company claims that 85% of the products it sells in Brazil come from local sellers who advertise on the platform.
However, at present, most sellers on the AliExpress platform are international sellers, and there are not many local Brazilian sellers.
Analysts said that the decline in the position of foreign e-commerce platforms such as Shein, Shopee, and AliExpress may have a positive impact on local Brazilian companies, especially clothing retailers such as Renner (LREN3), C&A (CEAB3), and Guararapes (GUAR3), which view Shein as their biggest competitor.
The author ✎ Nicole/AMZ123
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