E-commerce in Chile | flashing

Twinkle really pushes the boundaries. In the Borderless section, the authors shed light on the development of e-commerce in a country that is not often discussed, but is certainly worth discussing. This time: Retail companies look to Chile.

Any time you think of e-commerce marketplaces, Chile doesn’t come to mind. Nevertheless, the country is positioning itself as a good sub-topper in global e-commerce. They should have looked at Amazon and Ikea as well. In the first case, we can conclude based on documents seen by Business Insider and where Chile is mentioned as an expansion country. Credible because the documents revealed that Amazon was founded in Belgium. For Ikea, it’s pretty clear: In August, the housing giant opened a store in Chile for the first time. What makes it special is that the retailer is opening a store for the first time in South America. Colombia and Peru are soon to follow. Why those countries? That choice may make more sense than you think.

Logistical advantages

Ikea is an important player in South America. One of the largest platforms in Chile, Colombia and Peru, Falabella has been the Swedish furniture company’s franchise partner there since 2018. El País reports that Ikea is now mainly benefiting from this in the logistics sector. Store supplies come mainly from Barcelona. These take twelve weeks to arrive in Chile. From there, Falabella’s logistics capabilities are used to deliver to stores.

Falabella could also be a potential partner for Ikea’s online ambitions in the future. The furniture store doesn’t yet operate online in South America, but it could benefit from Falabella in the region. The latter is the largest player with a turnover of $768 million in 2021. In Chile, they love their online platforms, it turns out. Top-3 was completed by Ripley.cl and Lider.cl. The latter also sells groceries. But Chilean consumers mainly buy electronics and clothing online. The latter should also appeal to Amazon, which wants to move into Colombia in addition to Chile. It’s clear that Amazon is already promoting its cloud service AWS in Latin America and Chile. A sign that the company wants to invest in those markets.

23 percent

Last year, online sales in Chile rose 23 percent to $7.2 billion. The above three sites account for a quarter of that. Online sales in the country are expected to increase by 9 percent between 2021 and 2025. Online accounts account for one-fifth of total retail spending.