Latin American e-commerce giant MercadoLibre is among the few companies which still believe in burning out cash in the midst of coronavirus impacting the economies around the world. The Argentine company is intending proceeding with its initial plan of spending 4 billion reais ($717 million) in Brazil this year, a company executive told Reuters on Tuesday.
Although the U.S.-listed company saw demands slumping slightly in second half of March, but reported stronger sales in April as consumers increasingly shopped online while remaining under lockdowns.
The company might have to spend more on its logistics operations because of the rising e-commerce demand, but currently it is focusing more on saving money due to pandemic’s impact, said Stelleo Tolda, vice president for Latin America at MercadoLibre.
The shelter-in-place orders diverted more number of smaller sellers towards online platforms from the likes of MercadoLibre to keep on doing business while preserving their cash flows, Tolda noticed.
In order to make its logistics operation stronger and properly address to growing number of home delivery orders, the online seller not only employed 200 more of the direct staff but also tapped third-party employers to hire 2,500 workers since second half March.
He was expecting that many of the new consumers and sellers joining its platform during the current stay-at-home measures would remain using online marketplaces even the situation came back to the normal.
I am seeing the e-commerce’s business settling up at a larger point than it was before the crisis, Tolda said.
Moreover, MercadoLibre is also in this year plan of opening another warehouse in Brazil’s northeastern region which should be its fourth in the country, as said Todla.
Besides hiring new staff and planning new warehouse, the company is also aiming achieving goal of expanding MercadoPago, a financial service unit of the online platform.