‘We will have a plan for Lula, another for Bolsonaro,’ says president of Lojas Colombo

Eduardo Colombo was only 5 years old when his grandfather, Adelino Colombo, gave him a badge of “grandson CEO”.

“It was a huge thing, bigger than my chest, but I used to parade it all over the place, very proud,” he told sheet the 39-year-old executive, who since last month, with the death of his grandfather, started wearing the royal badge of the CEO of furniture and electronics retailer Lojas Colombo, the largest in the south of the country.

A lot has changed since the time when Adelino took Eduardo, his eldest grandson, on Saturdays to walk around the stores of the retailer he founded in 1959, in Farroupilha (RS), until today, when retail is undergoing a true digital revolution, accelerated by the pandemic.

With 306 stores in Rio Grande do Sul, Santa Catarina and Paraná, the Colombo group has 4.6 thousand employees and had revenues of R$ 1.95 billion in 2020, when it had a net profit of R$ 231.7 million. In addition to the chain of stores, it owns a finance company, Crediare, a motorcycle retailer, Colombo Motors, and a pet retailer, Colombo Casa Pet.

In 2022, total investments total R$ 50 million, which includes the opening of a new distribution center in Recife. The idea was also to open 50 stores in the southern region, but the group stopped the plans.

“If all goes well and the macroeconomic conditions don’t get in the way, we will have a good Black Friday and a good Christmas,” he says, referring to the economic uncertainty resulting from political instability.

“We are going to invest between R$ 25 million and R$ 30 million to open 30 stores, an expectation that is more down to earth with the current reality of the country”, says Eduardo, who highlights the challenge of selling with soaring inflation.

“A television costs practically twice what it used to cost before the pandemic,” he says.

Regarding next year, the executive sees a big question mark over economic activity. More questions still hang over 2023.

“We have two different strategic plans, depending on who wins the elections next year”, he says, referring to former president Luiz Inácio Lula da Silva (PT) and Jair Bolsonaro (no party), however without , give details.

“Brazil is very poor from a political point of view,” he says. “It’s like football in Rio Grande do Sul: either you’re Grêmio or you’re Inter”, he says, referring to the two great teams from Rio Grande do Sul, Grêmio and Internacional, characterized, respectively, by the colors blue and red.

To keep the company competitive in an environment in which large national and multinational networks such as Magazine Luiza, Americanas, Via (Casas Bahia and Ponto), Mercado Livre, Aliexpress and Amazon advance with well-oiled logistics, capable of reaching all regions of the country , Eduardo will have to mix the lessons accumulated by his grandfather in more than six decades of retail with a new posture, more open to innovation and thinking “outside the box”.

It’s not an easy task. Adelino Colombo led the retailer for 62 years with an iron fist, to the point where he was unable to get executives from outside the family in charge of the chain. He tried twice, in 2002 and 2011, to leave the CEO, but each departure lasted less than a year.

Even passing the baton within the Colombo family proved to be a complex decision: daughter Gissela was even named in early 2018 as the new president, but she stayed in the position for five months. Adelino returned to command and, six months later, announced Eduardo as his future successor—son of Carlos Alberto, Adelino’s only son, who was also the father of Gissela and two other daughters.

“I believe that I managed to better translate the demands of modern retail to my grandfather and, at the same time, take his wishes for the future of the company to the board of directors,” says Eduardo.

Adelino’s reputation as a “turrão”, however, brought him important achievements: 12 years ago, Lojas Colombo’s prestige in the South was one of the main factors responsible for the departure of Casas Bahia in the state of Rio Grande do Sul. “A retailer called Casas Bahia in Rio Grande do Sul, a region that highly values ​​local products and services, did not go down well,” says consultant Eugênio Foganholo, from Mixxer Desenvolvimento Empresarial.

Only in 2015 did Via begin to return to the region and now, in 2021, it is opening at least 12 new Casas Bahia outlets in the state of Rio Grande do Sul.

It is precisely at this moment that Eduardo Colombo intends to reinforce his trenches. “It makes sense for us to strengthen the physical operation in the South, where there is still a lot of room to grow in the interior cities”, says the executive, who does not rule out acquisitions.

Foganholo agrees. “The south of the country, especially Rio Grande do Sul, has small networks that are relevant in the local context, something different from other states in the country, where large networks dominate”, says the consultant.

But Seu Adelino’s grandson is also willing to open up new regions through e-commerce. “Our ecommerce is a mature operation, launched 21 years ago. We have four distribution centers – in Porto Alegre, Palhoça [SC], Curitiba and Serra [ES]– and next year we will inaugurate the fifth CD in Recife”, says the executive. The northeastern market is the third largest in digital sales by Colombo, after the South region and São Paulo.

“We achieved this representation basically without any advertising, only with our service, which is our differential in relation to the large chains”, says Eduardo, who started in the Colombo warehouse at the age of 14, until he reached the commercial directorship of the chain, before assume the presidency.

According to consultant Alberto Serrentino, from Varese Retail, the company’s differentiation in the market comes from credit, a great lever for customer loyalty. “In furniture, Colombo has a good profit margin and less commoditization”, says Serrentino, for whom the company understood the change in the client’s journey, when working with physical and digital sales.

“The market in general is very prostituted, with a focus on low prices, but the consumer is also looking for good service”, says Eduardo.

Today, Lojas Colombo has 150 sellers within its marketplace. “We already have 300, but we made a selection, seeking to add only those who offer a good service”, says the executive, who also led Colombo to become a seller on the Mercado Livre. “It increases our exposure”.

According to Eduardo, digital sales came to represent 48% of total sales at the height of the pandemic, but now they are at 30%, two percentage points more than in 2019. This year, the group’s turnover should reach R $2.1 billion.

Eduardo intends to prepare the company for an IPO. Until today, the company has been very conservative in directing expansion with its own resources – a wish of the founder, but which was gradually changed by Eduardo, who sees the need to expand the range of alternatives for the company’s growth.

“We’ve always had this culture, of not having partners from outside the family. Here is our livelihood: if business is bad, I don’t just lose my job, I lose everything,” he says. “We care a lot for the profit, it’s the only point where the whole family agrees to be in the blue”, says he, a committed Grêmio supporter.