Physical retail can compete with e-commerce and large networks

In an increasingly disruptive commercial environment, street stores need to find effective ways to compete with large chains and the e-commerce It is the new paradox of the sector, because the person who passes on the sidewalk can choose between the local physical establishment, the global brand installed in the nearest mall or a digital platform. The decision no longer depends on geography, but on attention, convenience and experience.

The numbers help to understand this scenario, according to SellersCommerce, an American platform specialized in e-commerce, 2.77 Billion people, or 33% of Earthlings, buy online. The global e-commerce market is estimated at US$ 6.8 trillion in 2025, with a projection of reaching US$ 7.95 trillion by 2027. And not only that, because only sales through social networks were scaled at US$ 1.17 trillion last year, according to E-commerce Germany News (EGN), reference portal on e-commerce.

Competition is both local and international.The buying public is omnichannel. The urban environment has become the scene of a fierce dispute. The consumer does not interact only with local commerce. He searches on his mobile phone while walking. He compares prices within the store itself. Discover brands on Instagram and finalizes the purchase on the sidewalk. Retail is no longer a territory delimited by walls.

In this context, the inevitable question is: how to ensure that street commerce remains competitive? Public policies are fundamental that allow it to compete against global giants. This is important, considering that this retail is a fertile universe of entrepreneurship and small companies, generating jobs, income and social inclusion. In a city like Sao Paulo, the largest economic hub in the country, with about two million active companies and an economy that accounts for a relevant portion of the national GDP, giving prominence to the stores of our sidewalks is a strategic decision.

In this sense, there are positive signs. Recent municipal public policies have been friendly to business. From 2021 to 2025, 869,004 companies were created in the city (number does not include MEIs), in addition to the immigration of 89,840 to the state capital. Only last year, 185,121 were opened and another 15,616 moved to the city.

This consistent movement reflects the reduction of bureaucratic barriers, the simplification of processes and a continuous agenda of legislation and public policies aimed at attracting and expanding investments, built in a coordinated way between different areas of government. Measures such as the reduction of ISS for strategic sectors, provided for in Laws 17.719/21 and 17.875/22, the modernization of public procurement with Federal Law 14.133/2021 and the regulation of the Technological Order, by Decree 64.062/2025, contribute to a more competitive and predictable environment.

There is also an ongoing urban structuring process, referring to the revitalization of the city center, a traditional pole of street commerce. The resumption of this historical region occurs through two interconnected programs, the PIU (Urban Intervention Plan) and the Requalifica Centro.

The first is operationalized in two major sections: the Historic Center Sector and the Metropolitan Center Sector, which covers Bras, Belem, Pari, Bom Retiro and Santa Cecilia. It proposes three clear axes: to thicken, mix uses and face the housing shortage. It foresees expansion of housing supply, retrofit of underutilized properties, preservation of historical-cultural heritage, encouragement of mixed uses, including commercial, and public-private cooperation in territorial requalification.

The Requalifica Center is aimed at adapting existing buildings to current standards of safety, health and accessibility, expanding the offer of area suitable for densification through retrofit. To make it economically viable, a comprehensive package of incentives was adopted: exemptions from IPTU for prolonged periods and ITBI, reduction of the ISS rate for engineering and architectural services linked to the works, remission of previous debts of the property, exemptions from municipal fees and gradual return to full taxation after the benefit period. There are also economic subsidies to cover a relevant part of the construction expenses.

These initiatives are not peripheral to the debate on e-commerce. after all, the dispute, more than digital, is also territorial, because the advance of e-commerce is growing and irreversible. It has brought convenience, expanded access and democratized offers. However, despite its importance to the consumer, it is necessary to keep increasingly strong and prosperous street retail, in which there is a living ecosystem of entrepreneurship, jobs and income.

The paulistanos, like me, know very well what I am talking about. The city pulsates in the windows, on the busy sidewalks and on the open doors. If the competition is now global, the answer needs to be local, intelligent, structured and courageous.

Alessandra Andrade's he is president of Sao Paulo Business, an investment and export promotion agency of the municipality.