HOME AND GARDEN

SPECIALIST RETAILERS IN
ECUADOR
Euromonitor International
February 2016
HOME AND GARDEN SPECIALIST RETAILERS IN ECUADOR Passport I

LIST OF CONTENTS AND TABLES

Headlines ..................................................................................................................................... 1
Trends .......................................................................................................................................... 1
Competitive Landscape ................................................................................................................ 1
Prospects ..................................................................................................................................... 2
Channel Data ............................................................................................................................... 2
Table 1 Home and Garden Specialist Retailers: Value Sales, Outlets and
Selling Space 2010-2015 ............................................................................. 2
Table 2 Sales in Home and Garden Specialist Retailers by Channel: Value
2010-2015 .................................................................................................... 2
Table 3 Home and Garden Specialist Retailers: Value Sales, Outlets and
Selling Space: % Growth 2010-2015 ........................................................... 3
Table 4 Sales in Home and Garden Specialist Retailers by Channel: % Value
Growth 2010-2015 ....................................................................................... 3
Table 5 Home and Garden Specialist Retailers GBO Company Shares: %
Value 2011-2015 .......................................................................................... 3
Table 6 Home and Garden Specialist Retailers GBN Brand Shares: % Value
2012-2015 .................................................................................................... 3
Table 7 Home and Garden Specialist Retailers LBN Brand Shares: Outlets
2012-2015 .................................................................................................... 4
Table 8 Home and Garden Specialist Retailers LBN Brand Shares: Selling
Space 2012-2015 ......................................................................................... 4
Table 9 Home and Garden Specialist Retailers Forecasts: Value Sales,
Outlets and Selling Space 2015-2020 .......................................................... 4
Table 10 Forecast Sales in Home and Garden Specialist Retailers by Channel:
Value 2015-2020 .......................................................................................... 5
Table 11 Home and Garden Specialist Retailers Forecasts: Value Sales,
Outlets and Selling Space: % Growth 2015-2020 ........................................ 5
Table 12 Forecast Sales in Home and Garden Specialist Retailers by Channel:
% Value Growth 2015-2020 ......................................................................... 5

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HOME AND GARDEN SPECIALIST RETAILERS IN ECUADOR Passport 1

HOME AND GARDEN SPECIALIST

RETAILERS IN ECUADOR
HEADLINES
 Current value sales of home and garden specialist retailers grow by 4% to reach US$5.2
billion in 2015
 Property appreciation and inheritance laws generate uncertainty in the category
 Comohogar SA leads sales with a 2% current value share in 2015
 During the forecast period, value sales of electronics and appliance specialist retailers are
expected to decrease at a CAGR of 1% at constant 2015 prices

TRENDS
 In May 2015, Ecuadorian president Rafael Correa informed the public about the property
appreciation law, which in fact is called the Tax of Extraordinary Value, which seeks to do
away with land speculation and cut the legitimate sources of accumulation based on
inheritance. Owning to the society’s discontent with the law, the president decided to
postpone its approval and start an open debate with different affected sectors, amongst which
real estate is the principal one. This uncertainty has generated a contraction in the short-term
real estate investment.
 At the same time of implementing a law of property appreciation, there was an attempt to
execute an inheritance law also. Taxes would be applied over inheritances, legacies,
donations and every inheritance gain at free title. This project was also temporarily suspended
because of the political unrest generated during July 2015. The attempt of executing this law
generated uncertainty in the real estate market because the purchase of goods and real
estate would cease to be attractive, as it could be subjected to taxes and because of this, its
inheritance would stop being profitable.
 Customs duties to imports implemented at the beginning of 2015 directly impacted demand of
imported products destined for construction and real estate decoration. Home and garden
retailers looked for national alternatives to imported products since the Ecuadorian consumers
are highly sensitive to the price of these kinds of goods.
 Current value sales growth in 2015 was slower than the CAGR registered over the review
period. Home and garden products are mainly imported and were very affected by the
customs duties to imports decreed at the beginning of the year. At the same time, the
uncertainty generated by the attempt of implementing the property appreciation law and the
inheritance law generated a contraction in real estate projects and therefore in the
consumption of home and garden products.

COMPETITIVE LANDSCAPE
 Comohogar, which is part of Corporación Favorita, led sales in 2015 with a 2% current value
share. This was thanks to its brand Sukasa, which is a format of retail that offers whole
solutions for construction and real estate decoration.
 Homewares and home furnishing stores showed the fastest growth in the category with a 4%
increase in current value terms. The problems over the inheritance and the property

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appreciation laws affect this category with a lower intensity as the Ecuadorian consumers still
feel the necessity of renewing their house decoration in spite of these laws.
 National companies approximately represent a 7% value share. These companies are part of
corporations such as El Rosado and Favorita, which are of local tradition and are strongly
positioned in the Ecuadorian consumers’ top of mind.
 Due to the political and social problems behind the inheritance and property appreciation
laws, the market has not been seen the entrance of new key players to the category.

PROSPECTS
 Forecast period value sales are expected to decrease at a CAGR of 1% at constant 2015
prices. It is expected that the real estate market contraction will remain in the short term, and
depending on the results of the debate over the inheritance and property appreciation laws in
the mid-term, the category’s growth could deteriorate or start to stabilise in a progressive way.
 Considering the latest events in national politics, it is expected that the inheritance and
property appreciation laws will cease to be applied in view of the upcoming presidential
elections of 2017.
 It is expected that internet and mobile retailing will not be attractive during the forecast period
due to the Ecuadorian consumer’s habit of choosing home and garden products in a personal
way.
 Owning to the real estate industry’s contraction generated by the debate of the inheritance
and property appreciation laws, it is not expected that new participants will enter the category,
depending on the decision over the laws. An opening to the mid-term entrance of new key
players could be expected.

CHANNEL DATA
Table 1 Home and Garden Specialist Retailers: Value Sales, Outlets and Selling
Space 2010-2015

2010 2011 2012 2013 2014 2015

Value sales USD million 3,752.5 4,165.1 4,436.8 4,758.2 5,000.6 5,207.0
Outlets 17,464.0 17,696.0 17,960.0 18,205.0 18,464.0 18,729.0
Selling Space '000 sq m 7,165.2 7,514.4 7,666.5 7,833.1 7,962.3 8,075.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 2 Sales in Home and Garden Specialist Retailers by Channel: Value 2010-2015

USD million
2010 2011 2012 2013 2014 2015

Home Improvement and 2,253.7 2,553.4 2,684.2 2,883.7 3,031.1 3,150.6

Gardening Stores
Homewares and Home 1,498.8 1,611.7 1,752.6 1,874.5 1,969.5 2,056.4
Furnishing Stores
Home and Garden 3,752.5 4,165.1 4,436.8 4,758.2 5,000.6 5,207.0
Specialist Retailers

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Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 3 Home and Garden Specialist Retailers: Value Sales, Outlets and Selling
Space: % Growth 2010-2015

% growth
2014/15 2010-15 CAGR 2010/15 TOTAL

Value sales USD million 4.1 6.8 38.8

Outlets 1.4 1.4 7.2
Selling Space '000 sq m 1.4 2.4 12.7
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 4 Sales in Home and Garden Specialist Retailers by Channel: % Value Growth
2010-2015

% current value growth, retail value rsp excl sales tax

2014/15 2010-15 CAGR 2010/15 Total

Home Improvement and Gardening Stores 3.9 6.9 39.8

Homewares and Home Furnishing Stores 4.4 6.5 37.2
Home and Garden Specialist Retailers 4.1 6.8 38.8
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 5 Home and Garden Specialist Retailers GBO Company Shares: % Value
2011-2015

% retail value rsp excl sales tax

Company 2011 2012 2013 2014 2015

Corporacion La Favorita 3.0 3.5 4.1 4.4 4.1

CA
Corporación el Rosado SA 1.7 1.6 1.6 1.7 1.7
Colineal Corp Cia Ltda 0.6 0.6 0.7 0.7 0.8
Almacenes Boyacá SA 0.5 0.5 0.5 0.6 0.6
Others 94.2 93.7 93.1 92.6 92.8
Total 100.0 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 6 Home and Garden Specialist Retailers GBN Brand Shares: % Value 2012-
2015

% retail value rsp excl sales tax

Brand Company (GBO) 2012 2013 2014 2015

Sukasa Corporacion La Favorita CA 2.2 2.4 2.4 2.1

Kywi Corporacion La Favorita CA 1.3 1.7 2.0 2.0
Ferrisariato Corporación el Rosado SA 1.6 1.6 1.7 1.7
Colineal Colineal Corp Cia Ltda 0.6 0.7 0.7 0.8

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Almacenes Boyacá Almacenes Boyacá SA 0.5 0.5 0.6 0.6

Others 93.7 93.1 92.6 92.8
Total 100.0 100.0 100.0 100.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 7 Home and Garden Specialist Retailers LBN Brand Shares: Outlets 2012-2015

sites/outlets
Brand (GBO) Company (NBO) 2012 2013 2014 2015

Kywi (Corporacion Comercial Kywi SA 20 20 22 22

La Favorita CA)
Colineal Colineal Corp Cia Ltda 21 21 21 22
Ferrisariato Corporación el Rosado SA 8 8 9 13
Almacenes Boyacá Almacenes Boyacá SA 9 9 10 11
Sukasa (Corporacion Comohogar SA 5 5 5 5
La Favorita CA)
Mega Kywi Comercial Kywi SA 1 2 2 2
(Corporacion La
Favorita CA)
Others Others 17,896 18,140 18,395 18,654
Total Total 17,960 18,205 18,464 18,729
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 8 Home and Garden Specialist Retailers LBN Brand Shares: Selling Space
2012-2015

selling space '000 sq m

Brand (GBO) Company (NBO) 2012 2013 2014 2015

Colineal Colineal Corp Cia Ltda 111.2 111.2 111.2 116.5

Kywi (Corporacion Comercial Kywi SA 38.5 46.0 50.3 50.3
La Favorita CA)
Sukasa (Corporacion Comohogar SA 17.8 18.9 18.9 18.9
La Favorita CA)
Almacenes Boyacá Almacenes Boyacá SA 14.5 14.5 16.1 17.7
Mega Kywi Comercial Kywi SA 8.0 15.0 16.4 16.4
(Corporacion La
Favorita CA)
Ferrisariato Corporación el Rosado SA 9.6 9.6 10.8 15.6
Others Others 7,466.9 7,617.9 7,738.7 7,839.7
Total Total 7,666.5 7,833.1 7,962.3 8,075.0
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources

Table 9 Home and Garden Specialist Retailers Forecasts: Value Sales, Outlets and
Selling Space 2015-2020

2015 2016 2017 2018 2019 2020

Value sales USD million 5,207.0 5,242.2 5,280.2 5,334.9 5,403.4 5,474.5
Outlets 18,729.0 18,990.0 19,248.0 19,517.0 19,781.0 20,060.0
Selling Space '000 sq m 8,075.0 8,226.3 8,393.2 8,627.3 8,765.6 8,901.8

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Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Note: Forecast value data in constant terms.

Table 10 Forecast Sales in Home and Garden Specialist Retailers by Channel: Value
2015-2020

USD million
2015 2016 2017 2018 2019 2020

Home Improvement and 3,150.6 3,165.5 3,178.4 3,204.6 3,236.0 3,272.2

Gardening Stores
Homewares and Home 2,056.4 2,076.7 2,101.8 2,130.3 2,167.4 2,202.3
Furnishing Stores
Home and Garden 5,207.0 5,242.2 5,280.2 5,334.9 5,403.4 5,474.5
Specialist Retailers
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources
Note: Forecast value data in constant terms.

Table 11 Home and Garden Specialist Retailers Forecasts: Value Sales, Outlets and
Selling Space: % Growth 2015-2020

% growth
2015/16 2015-20 CAGR 2015/20 TOTAL

Value sales USD million 0.7 1.0 5.1

Outlets 1.4 1.4 7.1
Selling Space '000 sq m 1.9 2.0 10.2
Source: Euromonitor International from trade associations, trade press, company research, trade interviews,
trade sources
Note: Forecast value data in constant terms

Table 12 Forecast Sales in Home and Garden Specialist Retailers by Channel: %

Value Growth 2015-2020

% constant value growth, retail value rsp excl sales tax

2015/2016 2015-20 CAGR 2015/20 TOTAL

Home Improvement and Gardening Stores 0.5 0.8 3.9

Homewares and Home Furnishing Stores 1.0 1.4 7.1
Home and Garden Specialist Retailers 0.7 1.0 5.1
Source: Euromonitor International from official statistics, trade associations, trade press, company research,
trade interviews, trade sources
Note: Forecast value data in constant terms.

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