eCommerce

Cargo Crime Wave Hits Brazilian eCommerce

Brazil is dealing with a dramatic rise in cargo robberies, with 22,000 thefts reported in two states alone last year.

According to Reuters, those thefts – in Sao Paulo and Rio de Janeiro – amount to about 60 heists per day, a figure that has almost doubled since 2012. The criminal gangs targeting these shipments have cost businesses hundreds of millions of dollars annually.

“You are always running a risk,” said retired police colonel Antonio Marin, head of security for Braspress, one of the country’s largest trucking and logistics firms. “It starts the moment you put cargo in the truck and travel across Brazil.”

While all businesses are potential targets, authorities say criminals tend to prefer consumer goods that are easy to fence.

The criminal activity has led companies throughout the Latin American nation to come up with strategies to protect its merchandise. Electronics retailer Via Varejo SA has developed a satellite tracking system to keep an eye on its trucks, and dispatches armed guards to accompany many shipments, logistics chief Marcelo Lopes told Reuters.

“We don’t scrimp on security,” he said. “We invest heavily to protect goods and to protect people.”

The company also relies on a “click-and-collect” operation, so that customers can pick up online orders at Via Varejo stores, which helps to keep delivery trucks out of dangerous neighborhoods.

And while retailer Magazine Luiza SA has a similar program for its online sales, it has also decided to avoid expansion in the Rio state, partly due to concerns about cargo theft, noted Chairwoman Luiza Trajano last year.

This is an issue Amazon will have to think carefully about as it works toward a major expansion into Brazil. Earlier this year, it was revealed that the eCommerce giant was reportedly seeking to lease a 50,000-square-meter warehouse near São Paulo. The potential investment indicates that Amazon may soon distribute electronics and other goods sold on its Brazilian website.

While Amazon declined to discuss its strategy, retail sources said the company better be prepared.

Brazil presents “a very different reality for the companies that prosper elsewhere,” Magazine Luiza’s CEO, Frederico Trajano, said at a public event in April.

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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