The Impact of Brazil’s Truck Drivers Strike on Its Ecommerce

First of all, this post does not endorse or condemn the truckers’ strike currently taking place in Brazil. I am writing it only in order to let our readers know about its impact on Brazilian ecommerce.

Brazilian truck drivers have been obstructing Brazil’s intercity roads, preventing deliveries of fuel (though the army has managed to allow some of these to be made in the last few days) and cargo in general from being made since January 21st. All sectors of the economy are suffering dearly, but since this blog is about online marketing, we will focus on the impact caused on ecommerce.

Brazil does not have a rail network, only a few train lines, most of which are mere tourist attractions. For this reason, it really depends on its roads. With the current state of things, Sedex delivery service, which is the fastest, has been suspended by Brazil’s postal service and, last Thursday, 38% of deliveries in general had not been made.

Now a little more background: Brazil’s post office has earned a very bad reputation for delivering terrible service in many ways such as losing packages (losing as in packages getting stolen) and delivery delays. So Brazil’s ecommerce customers, who already suffer from this problem, have hit the breaks on their online shopping. It has been reported that some of Brazil’s large ecommerce sites are experiencing a substantial drop on their conversion rate and even on product searches.

It’s important to note that this is happening two weeks from Lovers’ Day (Brazil’s equivalent to Valentine’s Day), which is on June 12th. This is an important yearly event for Brazilian ecommerce. It accounted for 2.85% of its sales in 2017 (1.71 billion BRL from a total of 59.9 billion BRL or 460 million USD from 16.1 billion USD in today’s exchange rate). And since the World Cup will be kicking off just two days after Lovers’ Day, ecommerce operations that sell TV sets, for example, are really missing out on a golden opportunity to make some good sales. After all, a lady who is in love with her boyfriend might just buy him a brand TV set for him to watch the national team on, even if she has to pay for it in installments.

At the same time, according to Ecommerce Brasil, the motorcycle delivery workers’ unions have been threatening to strike as well. And motoboys, as they are called here, are also an important delivery channel for many ecommerce sites.

Last but not least, according to Estado de Minas newspaper, Ebit, which is a reference on Brazilian ecommerce market intelligence, already foresees a retraction in the growth expectation for 2018. Previously 20.7%, they have now set it at 13.3%, an estimated loss of 280 million BRL, or 75 million USD.

I will keep following the events in order to keep our readers informed.