Casas Bahia is a Brazilian retail chain that specializes in furniture and appliances. Founded in 1958, it had over 500 stores by 2010 focusing on lower income customers. Its core business model was credit financing, with 90% of revenue from credit sales. It evaluated customers' creditworthiness and offered installment plans at varying interest rates. Aggressive marketing and strategic store locations also contributed to its success in serving the large low-income population in Brazil. However, some criticized that it exploited the poor by inflating prices and misleading customers about interest rates.

2. INTRODUCTION Casas Bahia is a in Brazilian retail chain which specializes in furniture and home appliances. It was founded in 1958 in `São Caetano do Sul São Paulo’ by Polish immigrant Samuel Klein. Samuel Klein started his career as a peddler selling products to immigrants from the Brazilian Northeast. By 2010, it had more than 500 stores in eleven states.

3. FOCUS Brazil’s population was divided into affluent class and lower income group. Out of which 84% was considered to constitute the lower income group. The high end product companies did not target lower groups. Casa Bahia decided to serve lower income group by providing them option of credit purchase on lower rates. Primarily maidservants,cleaners,cooks,independent street hawkers and construction workers were its customers.

4. BUSINESS MODEL Credit financing was the core business model. 90% of the total revenue came from credit sales. To finance purchases customers required to submit to an SPC credit check. The client receive a credit limit depending upon his/her total income. All the information collected was centralized and made available at all the stores . Casas bahia maintained records on the personality traits of its customers for future references.

5. Contd. The information was utilized by company to evaluate the creditworthiness of its clients to see their potential to buy new items. Rate of intereset varied for different credit period. Casas Bahia could by from suppliers at lower cost from competiors and was able to sell at little lower prices. Cross selling constituted another reason for the impressive sales figures of Casas Bahia. TRUST IN THE POOR WAS THE CRUX OF CASAS BAHIA PHILOSOPHY

6. Contd. Aggressive marketing was considered another reason for the success and popularity of Casas Bahia. Company invested around 3% of its revenue on advertisement. Sales were promoted using famous singers ,actors and television personalities. Success of casas Bahia business also depended on the strategic location of its stores.

7. CRITICISM FACED BY CASAS BAHIA Casas Bahia came under criticism that it is exploited the poor in the name of selling them branded products in easy instalments. Casas Bahia targeted the poor working class people by taking advantage of their vulnerabilities and yearning for expensive consumer goods. Analysts also commented that casas Bahia cheated the poor by saying that it charged lower rate of interest whereas the prices of goods are inflated.

11. Cross selling -income derivation & maintaining relationships

12. Aggressive marketing –involving singers, actors & famous personalities

13. Ideal location –reduced costs & high profits

15. Investing in the interest of poor

16. Acknowledging their efforts for timely payments

17. Modifications of financial terms & promotions –electricity cuts & unemployment insurance

19. Casas Bahia targeted the poor working class people by taking advantage of their vulnerabilities and yearning for expensive consumer goods.

21. Casas Bahia made it easy for the poor people by financing their purchases.

23. Around 4-5 billion people in world are at the bottom of pyramid so we can see the potential.

24. The Bottom of the Pyramid (BOP) has emerged as a dominant concept in business.

25. MNCs should view BOP markets as an unexploited opportunity and be proactive in fulfilling the needs and wants of low-income consumers.