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Carrefour
Carrefour is a French international hypermarket chain and the largest retailer in Europe, operating 11,000 stores across over 30 countries. It employs over 495,000 people and had sales of 112.245 billion euros in 2010. Carrefour operates various store formats including hypermarkets, supermarkets, convenience stores, and cash & carry wholesale outlets.
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Carrefour
- 2. A French international hypermarket chain Headquartered in Levallois-Perret-France 11,000 stores More than 32 countries and areas Over 495,000 employees (2009) Sales: 112.245 billion euro in 2010 4 store formats - Hypermarkets - Supermarkets - Convenience - Cash&carry
- 3. The Carrefour company iscreated by: - Marcel Fournier - Denis Defforey - Jacques Defforey
- 4. •Carrefour opens its first supermarketin Annecy, Haute-Savoie • Promodes is created by a merger
- 5. Carrefour invent a new store concept: the Hypermarket
- 6. •Carrefour introduces “produits libres” - unbranded productsbut “just as good and cheaper” • Carrefour gets listed on the Paris stock exchange
- 7.
- 8. •Carrefour creates “filiere quality systems”- guarantees product origin and traceability •Takes a controlling stake in Comptoires Modernes •Carrefour and Promedes merge
- 9. Carrefour group adopted a new governance structure with leading to a more fluid and effective operation able to respond with greater speed.
- 10. 1969- the first overseas hypermarket was built in Belgium. 1973- hypermarket in Spain 1975- hypermarket in Brazil 1982- hypermarket in Argentina 1989- first hypermarket in Asia, in Taiwan 1990- first hypermarket in Philadelphia,United States 1991- second hypermarket in New Jersey 1993- first hypermarkets in Italy and Turkey. 1994- first hypermarkets in Mexico and Malaysia 1995- first hypermarket in China mainland 1996- hypermarkets in Thailand, Korea, and Hong Kong
- 11. Lars Olofsson CEO and Chairman of Carrefour Pierre-Jean SIVIGNON, Chief Financial Officer José Carlos Noël PRIOUX, Thierry GARNIER, Eric LEGROS, GONZALEZ- Executive Director Executive Director Executive Director HURTADO, Chief France China and Taïwan Group Merchandise Commercial Officer
- 12. Year Revenues Profit 2008 89 billion Euros 382 million Euros 2009 87.2 billion Euros 385 million Euros 2010 87 billion Euros 1.87 billion Euros
- 13. Primarily a hypermarket, but also operates supermarkets, hard discounts, convenience stores No. 1 retailer in Europe and China in terms of size Reputation of variety, freshness and low price
- 14. Barriersto entry : 1) Product differentiation –All consumer goods under one roof 2) Economies of scale -Operates 10,378 stores in 29 countries 3) Switching Costs - Promotions, discounts, partnerships, credit program increase switching costs for consumers, suppliers, and partners alike 4) Access to Distribution Channels – Very difficult for new entrants to get access to new channels Expected Retaliation - Vigorous retaliation can be expected when the existing firm has a major stake in the industry, when it has substantial resources, and when industry growth is slow or constrained
- 15. Supplier groups are less concentrated Many substitutes available to the firm Retail giants important for supplier groups Minimum threat of forward integration from suppliers
- 16. Buyer’s are very important to the retail industry But no single buyer purchases enough to impact the industry Important to know buyer’s taste and preferences Special promotions and discount decrease buyer’s power
- 17. This depends on region or country of operation Generally low – promotion and services increases switching costs – tailoring to local needs Culture dependent – Mom and Pop store more popular in Asian countries
- 18. Numerous or equally balanced players Rapid Industry Growth Storage Costs and Fixed Costs High Strategic Stakes High Exit Barriers
- 19. A hit withcustomers: One-stop shopping Extremely low prices Full range of choices High quality of products From a business perspective: Seamless capture of international markets Resource integration High level of local sourcing
- 20. Hypermarket – Less cost, more variety of products, low to mid level quality Supermarket – Low cost, one stop shop for household’s needs Hard Discounts – Lowest cost, products with high shelf life and bulk buying Free Shuttle Services – Differentiation, increasing the reach of products Child Play Areas, Home Delivery, Cultural Center, Free Credit, Themed Corners
- 21. Value Creating Diversification ◦ Economies of scope: Sharing Activities Transferring Core Competencies Market Power – Vertical Integration Financial Economies – Efficient Internal Capital Market Allocation Value Neutral Diversification – Low performance, Uncertain Cash Flow, Synergy International Level Corporate Strategy ◦ Transnational Strategy – Global efficiency and local responsiveness. Combination of multi-domestic and global strategy. ◦ Entry Mode – Initially Strategic Alliance, later on wholly owned subsidiaries
- 22. 1) Largest hypermarketchain in 1) High operating expenses terms of size 2) Weak positioning in Asia and 2) Second highest revenues middle east 3) Joint ventures in various 3) Expansion plans taking too countries much time 4) Strong private label 4) Poor E-commerce performance SWOT 1) Walmart’s low prices biggest 1) Joint ventures and acquisition threat for more expansion 2) New players/ Local players in 2)Discount stores development the industry 3) Improve sale performance 3) Less knowledge of Asian countries 4) R&D in marketing 4) Slow expansion outside France
- 23. In China ◦ Govt. has stopped preferential treatment ◦ Rental prices high in Tier I cities ◦ Expansion plans halted In Europe ◦ Fall in operating profits ◦ Non food spending down by 10% ◦ Overall sales down by 4.4%
- 24. Continue the practices that have been successful Leverage knowledge of international market and expand into emerging economies Find innovative ways to improve products and services Be vigilant about threats to its operations