Business

Partnership with Mercado Livre is among Linx's initiatives to help its portfolio amid the crisis

“There was an average drop of 50% in sales, considering all sectors in which Linx operates,” CEO Alberto Menache told NeoFeed.

The New York Stock Exchange in Lower Manhattan in New York is decorated with a banner for the Linx initial public offering
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  • Specialized in management software, Brazilian Linx has a 42% market share in this sector;
  • CEO Alberto Menache said in an interview that an average drop of 50% in sales (in all sectors in which Linx operates) was recorded since the beginning of the pandemic;
  • The executive claimed that Linx is in conditions to last a year without revenues due the current situation

The Brazilian management software company and the largest software house in retail management systems in Latin America, Linx has more than 50 thousand clients in a portfolio filled by firms that range from pharmacies and gas stations to e-commerce players. With such expertise in the retail sector, the company has already felt the impact of the current crisis in the industry.

“There was an average drop of 50% in sales, considering all sectors in which Linx operates,” said Alberto Menache, Linx’s CEO, in an interview with media outlet NeoFeed. The data compares the last days of March to the beginning of the month, shortly before the WHO decree about the pandemic.

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Having moved its workforce to a remote model, the executive declared that in practical terms, its operations weren’t affected, adding that Linx is in conditions to last a year without revenues, although this shouldn’t be the case, as 80% of the company’s revenues come from recurring earnings. In 2019, this meant BRL 762 million. But even in a more stable situation, Linx’s CEO claims this to be the “the worst crisis that this generation has gone through. It is the worst crisis since the Second World War.”

Among their initiatives to tackle the impacts of the pandemic, besides renegotiating contracts to cut expenses inside the company and freezing the profits of the company’s top management and statutory directors, Menache highlighted the partnership with Mercado Livre, to integrate the operation of customers with their marketplace. “In the digital area, there’s a lot going on. We’ve helped our pharmacy customers, which is a sector that still has little presence online, to set up their platforms, since the consumer doesn’t want to enter pharmacies, thinking they are exposed.”

Earlier this year, Linx bought Neemo, a company that makes software for restaurant delivery, enabling them to have their own app. “There was an increase in demand of at least 5x compared to what it was before the crisis,” Linx’s CEO told Neofeed. “Linx has been seeking alternatives to help its clients.”