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Colombia: Hard-Discount Growth Bet - D1 sets its sights beyond local dominance, aiming to build a multi-regional footprint

Updated: Jul 24

Discount Retail Consulting D1 has become one of the protagonists in the commerce sector in recent years. Its growth has been sustained and, by 2025, it had a turnover of 24.3 billion pesos, growing at double digits, with an expansion that, in the opinion of Christian Bäbler, president of the company, is progressing at a "good pace". Last year, 200 stores were added to reach about 2,800 in the country.


It was a good year," says Bäbler, explaining that the market, in general, grew in value in 2025. "For us, as discounters, it has gone well. The discount has been growing strongly in recent years compared to other channels," he adds.


It refers to a successful model, known as hard discount, which offers basic basket products at low prices, seeking the greatest operational efficiencies and reducing costs.


"The concept of the discounter has played a similar role in the countries where it has been present. The main impact is to contain prices. In other words, we are really an inflation thermostat. We try to ensure that our operational efficiencies are systematically and consistently transferred to price, without reducing quality. And this makes the context of competition move and improve. This is the basis at the end of the discount," he says.


Explaining the role of the model in commerce, Bäbler anticipates that the discount has found its place, "but it does not exclude the others either. Our assortment is shorter than the rest; is part of the concept. Still, we try to offer a complete basket, but there is room for everyone."


Christian Bäbler maintains that the company is a leader in toilet paper, as well as detergents.

He explains that the D1 portfolio aims to offer the complete basket that Colombians need in their day-to-day lives. "What happens is that we try to do it in the most efficient way possible, that is, with a very short portfolio compared to others, but at the same time very efficient: with few references we cover the needs that others cover with more references. This is part of the keys to the model."


According to Bäbler, D1 has between 70 and 90 categories, "those that the customer demands and demands. What happens is that our portfolio in each of them is governed and concentrated on the basics and what is necessary."


In this basket, says Bäbler, many of the categories at the basic level are even leaders, with their own brands that occupy the role and space that commercial brands have in other channels. "For example, we are leaders in toilet paper, as well as in detergents. We are also very strong in other categories, such as cheeses and yogurts."


Others have been added, such as household items, decoration and textiles, and some seasonal ones, such as barbecue, categories that have attraction, traffic and a new dynamic for the chain.


Likewise, D1 is in pilots to incorporate fresh meat into its portfolio. "Meat has a very important challenge, which is the maintenance of the cold chain; it is the very profitability of the category to make it sustainable. Of course, we buy all the meat and we are going to buy it in Colombia. I think we're destined to be one of the biggest meat sellers in the country. We are going step by step, trying to make the product the right one in quality, but also in price for the Colombian," says Bäbler.


Regarding fruits and vegetables, the president of D1 highlights its operation and points out that "the fruver has worked very well". He adds that it continues to penetrate and, each time, they have more references "within a short assortment." And he adds: "D1 is destined, as in meat, to be one of the largest distributors of fruit and vegetables in the country."


Investments last year totaled 400,000 million pesos, resources that, Bäbler explains, basically stay in the country, "which has an impact on a growth of suppliers who advance with us"; while it stands out, for this year they have an expectation of double-digit expansion and maintain the same pace of investments as in 2025.


For this year, D1 aspires to open 400 new stores, in a strategy to densify its presence, with slightly larger stores and a better customer experience.


Investments have focused on infrastructure, basically logistics, but also on sustainability issues. "Energy efficiency has weighed heavily in the face of climate change, energy costs, potential constraints and now with an approaching El Niño phenomenon," Bäbler says.


Are you looking to have self-generation? "Yes, solar panels and Colombian law admit it. There is also the variant of solar farms, where one can, in quotes, generate energy and consume it remotely. There are several alternatives that we are working on. Also in distribution centers that are large generation entities. Basically for self-consumption, but the surplus can be sold on the grid. This is an issue that is already regulated and makes all the sense in the world."


While growing in the local market, D1 is advancing in a new strategy: the internationalization of its model.


"It is an initiative that is still on the radar, in a deeper and clearer way. "We would love to be a Colombian multi-regional retailer. I think that as a model we have been a benchmark in the region and on the radar there is an interest in this crystallizing," says Bäbler.


For this year, D1 aspires to open 400 new stores, in a strategy to densify its presence


Although it recognizes that the hard discount format is in other markets, perhaps not with the penetration it registers in Colombia, "but they are on their way," such as in Ecuador, Peru, Chile and, logically, in Venezuela. "Everyone is attentive, despite the misfortune of the earthquake, to what happens in that country and its evolution in the coming years. I would say that there is a discount gold rush in the region, not only in South America, but also in Central America."


Faced with the possibility of arriving in Venezuela, Bäbler says that there is expectation, "wanting to help energize a market that has been off the radar for many for various reasons, known to all. We would love to help Venezuelans also enjoy the advantages of a format like ours. They already do it tangentially because we have stores on the border where many Venezuelans already know our brands and we have specific weight."


He adds that the hard discount in Venezuela would generate an important function and social impact. "Venezuela's products are not cheap, and even less so if one compares it with the purchasing power of the population in general. And I think we are called, as a channel, to generate a positive impact on the population there."


According to Bäbler, for the development of the model in other markets, it is key to have local suppliers. "We import the minimum necessary. Anything we can buy here, we buy here. And the impact we generate on suppliers is gigantic. The same would have to be done in any other country where we could enter."


And he adds: "But this requires development, stages, growth, and that has to be built little by little, as was done in Colombia with D1 15 years ago." In addition, he warns that the opportunities are open to the possibility of having local partners or in an individual D1 strategy.


On the other hand, in the face of the increase in the minimum wage, Bäbler says that the impact in his case was less. "We have 28,000 employees and we pay practically all of them above that level. In other words, this increase affected us in a group of workers to whom by law we must pay the minimum wage, which is about 3,000 of the 26,000 we had at that time. The rest are above the minimum wage."


With the arrival of the new government, the president of D1 warns that one of the challenges is security. "It would be a pleasure to see how the safety conditions improve for our employees and also for our carriers, in many areas of the country. This is not only a desire of D1, but also thinking about its consumers and the population in general."


He stresses that legal certainty is also fundamental and says that it is advisable for polarization to be lowered. "It seems to me that any government should govern for everyone. We must think about the common good, about everyone's good," he concludes.



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