FEMSA increases its OXXO stores in Mexico, Colombia, Chile and Peru
Fomento Economico Mexicano (FEMSA) increased the number of its OXXO stores in Mexico, Colombia, Chile and Peru in 2020.
On the one hand, in Mexico it achieved 206 openings to reach 19,295 stores.
At the same time, at the end of 2020, it operated 110 stores in Colombia, 104 in Chile and 57 in Peru, which represents 10, 14 and 6 more units than at the end of 2019, respectively.
FEMSA’s Proximity Division operates the largest small-format store chain in the Americas, measured by the number of stores.
Despite the adverse conditions due to the Covid-19 pandemic, the Proximity Division expanded its operations with the opening of 236 new stores in Mexico, Colombia, Chile and Peru during 2020.
In addition, as of December 2020, Grupo Nós operated nine OXXO stores in Brazil.
OXXO Stores
Thus, the Proximity Division has aggressively expanded its number of OXXO stores in recent years.
The average investment required to open a new OXXO store varies, depending on the location and format and whether the store opens in an existing retail store or requires the construction of a new store.
Generally, the Proximity Division can use vendor credit to finance the initial inventory of new OXXO stores.
Currently, the Proximity Division expects to continue implementing its expansion strategy emphasizing growth in areas of high economic potential in existing markets and expanding into underserved and untapped markets.
Most OXXO stores operate under lease contracts, which are denominated in Mexican pesos and are adjusted annually to an inflation index.
This approach provides the Proximity Division with the flexibility to adjust locations as cities grow and effectively adjust its footprint based on store performance.
Both the identification of locations and the pre-opening planning to optimize the results of the new OXXO stores are important elements in the growth plan of the Proximity Division.
For this reason, the Proximity Division continually reviews the store’s performance against certain operational and financial benchmarks to optimize the chain’s overall performance.
Proximity Division stores that cannot maintain benchmark standards are generally closed. Between December 31, 2015 and 2019, the total number of OXXO stores increased by 5,269, as a result of the opening of 5,586 new stores and the closure of 317 stores.
