Day 2 of the IBC Global Forum immersed attendees into overviews from retailers in varied regions of the world. The morning began with a look at Honduran retailer Corporación Lady Lee.
Since 2012, Carlos Zelaya has been the Commercial Manager of Corporación Lady Lee’s department store group, Almacenes Lady Lee. Mr. Zelaya is responsible for commercial strategy, all purchasing and inventory for all product lines within the 20 Almacenes Lady Lee stores. Prior to working for Corporación Lady Lee, Mr. Zelaya was a product manager for Grupo Elektra. He has an MBA from University of San Pedro Sula in Honduras.
Headquartered in San Pedro Sula, Honduras, Corporacion Lady Lee has several business units under its portfolio, including Lady Lee department stores. Within the main cities of Honduras, the 20 Lady Lee stores offer a full range of products, with a focus on home and housewares.
Market demographics
Honduras, one of the countries of Central America, has a population of 8,630,890 people. Five major cities dominate the economy, with 65% of the nation’s economy centered in the two top cities—the capital of Tegucigalpa with about one million and San Pedro Sula with 500,000, where manufacturing of auto parts, textiles and other products takes place. Per capita income is $5,000, compared to the average $6,500 in nearby countries. Major exports include silver, coffee, bananas and grains and foreign investment is growing.
Holidays that impact retail sales: Mother’s Day (second Sunday in May), June 14 Honduran’s Day, and November Black Friday, which features promotions and begins the most important sales season of the year.
Retail overview
Department stores: Lady Lee 20 stores, Diunsa 5 stores, Walmart 2 stores
Specialty stores: Jetstereo 22 stores, Elements 2 stores, Ashley furniture 1 store
Internet/catalogs: online sales are growing, currently 50% of the population has internet access.
Honduras maintains Free Trade Agreements with Central American countries, assuring zero import taxes. For other importing countries, retail price is defined as the sum of the FOB price, freight interest, other expenses, import taxes, margin, and the VAC of 15%.
Company profile
Lady Lee has operated for 44 years in Honduras and its business group is responsible for 3,000 jobs and more than 15,000 jobs indirectly throughout the country. The company is focused on strengthening its portfolio of companies and is planning expansions.
The company includes casual dining, real estate, department stores in four formats and our foundation that offers help to needy communities. The foods division includes five Applebee’s and five Wendy’s restaurants. The real estate division owns and operates 14 shopping centers; City Mall in the capital is a first class shopping center with premium brands and high design and architecture. The company is expanding to other countries; their 200,000 sq. meter shopping center in Costa Rica opened last year and features prestigious brands and innovative design.
Sales Staff and Structure
Lady Lee’s wholesale division tends 250 customers around the country. They select their best customers to invite to two main fairs each year in March and October.
In the retail division, each format store group—the 14 Lady Lee department stores and six Lady Lee Express stores—serves targeted demographics. In the top categories, 90% of products are major brands and 10% are private label. Ninety percent of the products are imported. They like to work directly with brands instead of distributors or sales representatives in order to keep costs down. Four housewares buyers manage the product selection. Expectations from vendors include display, training, warranty, coop advertising and digital marketing.
In the short question period, Mr. Zelaya commented that Lady Lee plans to expand to Nicaragua and other countries in the coming years.
