More resistant than other retail branches to this moment of tightening in the consumer’s pocket, the pharmacy suffers less from the reflection of the rise in interest, but feels the inflation in costs, according to Antonio Carlos Pipponzi, chairman of the board of the giant RaiaDrogasil.
The businessman, who has already headed the IDV (Instituto para Desenvolvimento do Varejo), one of the main associations of Brazilian retailers, recognizes that the effect of the PEC of benefits should irrigate sales in the sector as a whole, but he sees an electoral orientation and says that alleviates inequality.
“It’s a topic that will boost retail sales, it’s a topic that has everything to do with election. What we need is to solve structural problems and not simply make an emergency injection.”
Pipponzi, who is part of a group of businessmen who call themselves Nem Nem, nor Lula nor Bolsonaro, still sees the possibility of growth in the third way.
How is inflation feeling in the sector in general?Detaching a little from my pharmaceutical retail figure, which has specific characteristics, retail in general today suffers, especially in durable goods. When interest rates go up, it misaligns, sales fall, because there is a lot of financing. In the lower purchasing power of the population, the most expensive product gets its purchases postponed.
Consumer goods companies, on the other hand, suffer less, because sales are predominantly in cash or on card. I’m not saying that they are doing well at the moment, because there is inflationary cost pressure. But demand is more stable, especially in the pharmaceutical trade. It has greater resilience, but it is a peculiar characteristic of the sector.
In the case of durable goods, how can credit hold a little?It’s difficult. Sometimes, loosening a little more the rules of acceptance, of granting credit. It’s a little there.
What about pharmaceutical retail, which had a great time with the pandemic? What’s on the horizon when this period passes?Pharmaceutical retail has lived through three important cycles in the last decade. The first was the gold rush, from filling physical spaces to having a large network and being close to the customer. The second was the wave of multichannel, in which the world is no longer just physical and becomes also digital. The third, which came before the pandemic, is the pharmacy as a health center.
We were already getting ready to have a pharmacy capable of offering more services. When the pandemic comes, it accelerates this offer. Come tests, vaccination. And telemedicine comes, not specifically within the pharmacy, but you are already starting to aim, through agreements. We come to see this world closer.
About consumption: in the beginning, there was acceleration in medicines. Then a sales reaction period with tests and self-tests. Today, it begins to stabilize. The trend is for it to stabilize at a higher level, because people start to monitor not only Covid, but other flu more often.
Is the expansion of services not subject to regulation? Years ago, large foreign drugstore chains, which had this more evolved standard of service, looked to Brazil. What is missing from regulation?Brazil has always had regulatory obstacles. This made it difficult for outside companies to enter, not only from a sanitary point of view, but also from other issues, such as taxation. It doesn’t happen overnight.
Telemedicine, for example, is not fully regulated. And it’s something that I think will end up going through the pharmacy.
There is the matter of laboratory tests. This habit of going straight to the hospital when you feel small symptoms, for example, will overload the health system. Can part of this demand not be met at the pharmacy? A network like ours has 10,000 pharmacists. They are professionals, who know when they can solve a problem or when they should refer to a doctor.
If we don’t make room for this concept, we will have a bottleneck in regulation and, consequently, the system will become increasingly expensive.
As a member of the IDV, Mr. follow the discussion of the fight against the digital camelódromo? How does pharmaceutical retail get into this?The IDV is in a strong fight. Nothing is worse in any business than competition with different rules. If formalized companies pay tax, when space is made for other competitors that do not have the same requirements, they lose competitiveness in favor of informality or illegality. What we want is balance in this and accountability.
It is essential to understand the marketplace and take responsibility for the products it sells, for its suitability, for issuing invoices.
At the end of the 1990s, there were withdrawals in pharmacies. They stole products with a huge frequency and distributed them to distributors for R$ 2. Today, they don’t have that in medicine anymore. But take a camelódromo like that. This even gives rise to theft. Hence the need to regulate marketplaces. In the case of pharmaceutical retail, very little goes through marketplaces.
What do you expect from a tax reform?This government came in with a very reformist proposal. Now, there are ways and ways to do reform. It seems that the goal is to say that a renovation was carried out, regardless of quality and length. The point is to focus on increasing the collection base. It’s bringing everyone to collect within the system. Whether the system is a digital tax, which I’m sympathetic to, or another, doesn’t matter. What matters is that the base has to be increased. If you don’t widen the base, you can’t turn down the volume.
The IDV does not want to take a stand against tax reform. What we want is a competitive balance. And this is analogous to other reforms. The administration was almost all prepared, all of a sudden, concessions start here, concessions there and park.
So it was with the privatization process. Until that theme still had a recent forwarding a little more aggressive. But that’s it with all reforms. Labor itself is already beginning to talk about reversal or adjustment. We fought hard for labor reform. It is difficult to talk about reform. It’s not just ticking them off one by one and saying they were reformists.
Lula’s campaign talks about messing with labor. How do you rate?It’s one thing to make some adjustments, even appropriate ones. What it cannot do is dismantle the scope of reform. That exaggerated power cannot be returned to the unions, which fostered a giant structure and even with the allocation of resources that many questioned. Cannot return discussion about loss of suit, of paying attorney’s fees for claims without procedure. Another important point is part-time work.
Adjustments may have. Now, I’ve heard of revoking completely. At another time, that would be adjustments. The speech is not very clear.
Mr. is part of a group of businessmen who call themselves Nem Nem, defenders of the third way. What are you guys thinking?We are advocates of the third way, relentlessly, until the end. I don’t think of anything other than a third way. My candidate is Simone Tebet. I think the campaign gains weight with the release of funds. I have no plan to support another candidate.
I see problems with both. Bolsonaro assumes a lack of knowledge of the country. I think it’s very serious for him to say that he has no knowledge of economics. I can’t understand how anyone can run a country without knowing economics. He changes ministries, the Ministry of Education, the most important in the country, five, six changes of ministers and did not walk. There are extraordinary recipes for education, alternatives that have been successfully deployed in states and municipalities. It is a matter of political will.
On the other hand, we look at a candidate like Lula with great concern about the path of strengthening the State, anti-reform. Honestly, between one and the other, I have no choice, I only think of a third way.
What kind of change of scenery did Mr. expect to see after the effects of the PEC resources that expands social benefits?Injecting more resources into the economy surely solves a momentary problem. It can leverage retail sales. But it does not solve the country’s structural problem at all. The inequality that the country is experiencing today, and the scenario that it faces, are extremely worrying.
Sometimes we tend to say that Brazil is bigger than all crises. Brazil is bigger, but inequality grows more and more. So, I think it’s a topic that will boost retail sales, it’s a topic that has everything to do with elections. It is intended to interfere in the election process.
What we really need is to solve structural problems and not just do emergency injection. Now, it’s going to be good for retail, which is going to capture some of that.
RaiaDrogasil
Created in November 2011 after the merger between the Droga Raia and Drogasil chains, which formed the largest pharmaceutical retail chain in the country, RD (RaiaDrogasil) operates in all Brazilian states, with 2,500 units. Last year, the company recorded revenues of R$ 25.6 billion
I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.
