LYCOS RETRIEVER 
Casas: Casas Bahia
built 606 days ago
Because Klein hated to pay rent, almost half of Casas Bahia's stores were the company's own property. In buying merchandise from about 300 suppliers, Klein preferred to pay immediately in cash, if possible. In dealing with them he had powerful leverage, since the chain was bu ying more than 10 percent of the production of the principal national manufacturers of home appliances. Even so, the suppliers liked deali ng with him because he came to a decision immediately and paid on the spot. Much of this work was being conducted by his younger son, Sa&u acute;l, while the older one, Michael, concentrated on finance. But K lein was not averse to micromanaging his enterprise by such means as personally determining the price of sale for any of the thousands of items that the chain was selling, using as a guide the newspaper ads of competing chains.
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Casas Bahia is the largest retail chain in Brazil, selling electronics, furniture and appliances. With 55,000 employees and more than 500 stores, the company has developed an innovative financing model to service the lower-income segment of Brazil's population.
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Buffeted by the fluctuating fortunes of the Brazilian economy, Casas Bahia sustained a 17 percent drop in sales in 1997 and its first reco rded loss, about $7 million. "They had problems, but they adopted an intelligent strategy," an executive of a rival chain told Jos&eac ute; Roberto Caetano for an article in Exame. "They kept their prices high, at least 15 percent higher than ours. They relied on th e loyalty of their clients. continu ed buying from Bahia because they were afraid of losing credit and no t being able to get it from another store." After opening its books t o outsiders for the first time, Casas Bahia successfully floated its debentures and a six-month promissary note.
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When IBM discontinued support for OS/2, Casas Bahia needed to standardize on a new platform for its enterprise architecture. The company estimated that moving to a proprietary solution would cost more than US$8 million. Instead, Casas Bahia turned to Linux for an open platform that would provide greater flexibility and scalability.
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