CarrefourChain in The European Market
CarrefourChain in The European Market
Theretail industry is believed to be one of the largest and profitableindustry in the entire globe. There are thousands of supermarketswhere customers can get most of the items they demand at a discountand wholesale price in the big cities around the world. CarrefourSans happens to be one of the largest chain stores with manyoperating branches across the world. Carrefour is a French retailerwith over 16,000 hypermarkets as from 2015. In size of its revenueand total outlets, the hypermarket ranks second overall in the entireworld after Walmart. The retail chain store currently operates inmore than 30 countries, which include countries in Europe, America,Asia, and Africa. The name Carrefour implies “Crossroads” and“public square” in French. Carrefour Sans is also a member of theEuro Stoxx 50 market index. The company employees are over 364, 969in all the outlets across the globe. The company makes over 76billion euro annually in terms of its revenues.
Carrefourretail chain store opened its first store in 1960 within a suburbanAnnecy next to crossroads (McDermott, 2012). This crossroad locationis where the chain store got its name. The Carrefour group wasestablished by “Marcel Fournier, Denis Defforey and JacquesDefforey” in 1958 after they were influenced by several seminarsthey had attended in the United States of America that was led by the“Pope of retail” by the name of Bernardo Trujillo. Mostimportant, the Carrefour Group was the first to open a hypermarket, abig supermarket as well as a departmental store under one roof in theentire Europe. The Carrefour Group opened its first hypermarket inSainte-Geneviève-des-Bois, next to Paris in Frances on the 15th June1963 (McDermott, 2012). This hypermarket covered a ground area ofapproximately 2,500 square meters, had twelve checkouts and a parkingspace for more than 400 vehicles. In the year 1976, the grouplaunched a private label known as “Produits libre” meaning, “freeproducts” which comprised of fifty lines of foodstuffs such as oil,biscuits, and milk that were sold in unbranded white packages at aconsiderably low prices. In the year 1999, the group merged with“Promodes,” referred to as Continent which was its maincompetitor in France.
Carrefourhas set its mission to doing their job well (Network, 2012). In thismission, Carrefour retail chain stores aim to be considered as thestandard in contemporary retailing in every of its markets. They alsoaim to offer their customers the best prices and the greatestmerchandise, in each store, and in each country where they operate(Network, 2012). This mission can further be explored as follows:
Carrefourhas a clear strategy of swiftly expanding its three major types ofstores, which include “Hypermarkets, supermarkets, and thediscounters” globally. Through this strategy, it intends to buildmarket share in every nation in which it operates through expansionof the best retailing outlet suited to the local market as wellthrough taking the advantage in the manner in which the three formatscomplement one another.
Inits mission, the company has also ensured that it gives back to thesociety by forming a food program foundation where people can donatefoodstuff they have to help the needy people in the society. As aresult, many people are donating to the food aid program.
Carrefouris globally committed to promoting the application of human rights inall countries in which they operate, through performing theirbusiness fairly and ethically, establishing a working environmentthat benefits everyone, including social responsibility in thedecision making and provides safe and healthy commodities as well asprotecting the environment. As such, Carrefour has demonstrated itscommitment to the economic growth of local environment it operates.In its mission, the company believes that retail encompasses peopleand always gives preference to recruit individuals who reside in thelocality and train its managers and staff on the operation site.
Carrefourhas ensured environmental sustainability in its mission byestablishing a Department of Prevention, Health and the Environmentin 2000 to ensure that all its operations promote environmentalsustainability in all countries where they operate. This departmentis management by a small team that gets support from a wider networkof in-house contacts from all the departments, for instance,marketing, supplies, logistics, and operations.
Carrefourhas a hierarchical organization with a much more organizationalconfiguration. This hierarchy, the Chief Executive Officer occupiesthe highest rank within the management structure with the ChiefFinance officer below him. Throughout the management structure, thepeople in charge also ensure that there is quality management, properdesign and strategy, a well-functioning human resource, and aninventory management as illustrated below:
Carrefouris committed to supplying quality-core market commodities that complywith the strict requirements for traceability, quality, and taste(Christopher, 2016). Additionally, quality and continuous managementsolutions accomplish the designs, the implementation, and theevolution of the operational and technological quality requirementsof Carrefour products.
Carrefourmanagers are responsible for designing strategies that enable theirdepartments to succeed in meeting their targeted goals. The strategyis based on a fit that between the company and the environment whereit operates. Similarly, the managers are given the responsibility ofdesigning the aims and the internal structures which ensure that thatthe company succeeds in its business environment, despite theincreased level of competition. As such, the company can facehead-to-head with the competitors.
Carrefouracts as the central place for human resources, which include knowinghow to sell and buy. The company is passionate about its commoditiesand enjoys dealing with its customers as they have a sense of service(Christopher, 2016). Chain store makes its employees work easier,train them, and help them on a daily basis so that they can becomemore available and to help the customer better. The employees areencouraged to show initiatives, be sociable, and create links betweenCarrefour and its customers.
InCarrefour, the inventory manager is in charge of tracking themovement of inventories. Carrefour always ensures that there areenough products on the shelves. He shelves are frequently checked toensure that they are fully occupied with the right product demandedby the customers. The inventory manager determines the probability ofwhether the stock in the shelves will be sold or end up the trash.The manager always works hard to reduce wastage as too much wastewould cost the company.
Asopposed to other globally operated retail chain stores such as Metro(Zoe, 2012), which possess financially independent worldwideoperations, the operation strategy of Carrefour is driven by thefunding from its French operations. The operations of Carrefour canbe divided into the following sections:
Culturaladaptation (3 PL)
Carrefouris globally committed and adapted to promote its brands worldwide.The company adapts to the culture of the region where it operates.The cultural adaptation can be witnessed by its operation in thefollowing three culturally differentiated countries around the world.
Egypt,Africa.Carrefour is the first multinational hypermarket to operate in Egyptwith a wide stretched scalability comprising of more than 21 storesin just three governorates. On the 28th of August, the Majid AlFuttaim group opened its 9th Carrefour hypermarket in the city ofAlexandria in Egypt. The company has adapted to the culturalorientation of the country. Carrefour is doing extremely well inEgypt as it can be witnessed by improvements the Majid Al FuttaimGroup has made in running 128 stores of Carrefour retail chainstores. The success was as a result of the acceptance by the peopleof Egypt as it adapted to their culture.
SouthAmerica.Carrefour has also taken a keen interest in South America. In Brazil,the first Carrefour store was established in 1975, and since then, ithas grown to become the second biggest chain of super markets.Carrefour competes with Groupe Casina and Walmart in the Brazilianmarket. Carrefour has also ensured to adapt to the culturalorientation of Brazil so as to promote the sale of its products.
China.Carrefouralso expanded outside Europe and built 36 hypermarkets in Asia, inwhich 22 were in china in 2007. Carrefour broke the record foropening stores in a single when it entered China market. Carrefourwas the leading retailer from outside China in term of its salesfigures, until 2008 when it faced rebellion form the Chinese. Sincethen, the company has lost number one position to RT-Mart.
Carrefourhas a philosophy that its performance should also be measured by thecontribution it makes to the society in which it operates. As such,it ensures that it trains the locally available individuals to takemanagement positions, and any other position available. The localsare given the priority during recruitment. As such, the Carrefour hasmanaged to improve its performance through training the localindividuals who also aim at improving their performance to remaincompetitive in the job market.
Carrefourhas modernized its in-store customer communication systems leavingbehind the outdated print poster strategy for communicating with itscustomers world-wide. The company decided to go digital to counterthe increased competition in the retail industry. As such, Carrefourexplore the following areas to improve its network globally.
Carrefourexplored the digital platform to include E-Commerce solutions toallow its customer shop anytime they want, anywhere, from theirphones, computers, or tablets. It was developed on the basis ofcustomer experience to provide the best comprehension of usageanticipations.
Carrefourhas opened many distribution centers across all the countries inwhich it operates. The distribution centers are expected to act asthe overpass of Carrefour global chain supply to form a radiation oflogistic s and distributions networks.
Theclosing of stores
Carrefourhas considered closing some of its stores that do not bring muchimpact to the performance of the company. Among the stored closed bythe company includes those in Hong Kong after complaints from themanufacturers concerning selling of commodities whose prices are farmuch below those of its competitors.
Theemployment impact of Carrefour chain stores can be observed by theimproved competitiveness of the company globally, beyond Europe.Through employment, Carrefour has contributed to the attainment ofthe objective of corporate social responsibility world-wide.
Carrefourhas plans to increase its investments through opening more chainstores in countries which it has not explored. This plan is incontrast to Tesco’s plan to reduce spending. Carrefour believes inspending for better returns.
Carrefourhas designed competitive strategy to curb the ongoing competitionamongst the major retail store worldwide (Zoe, 2012). Its biggestcompetitor includes Walmart Stores, Inc., Auchan Holding, and TescoPlc. Among the competitor, Wal-Mart Stores, Inc. is the greatestcompetitor that always put Carrefour on toes. The group has devotedto taking practical actions to remain competitive in the nations inwhich it operates through increased awareness, provision ofhigh-quality products and services, and giving back to the community.As such, the company continues to attract customers as they canidentify with it.
Carrefourhas always focused on increasing its productivity and its operatingefficiencies through quality service provision and improvedcompetitiveness especially in Europe to gain control of the retailmarket. Carrefour has managed to do so by ensuring that overallquality of its products as well reduced errors by the employees whoaim at the provision of highly standardized services its customer.Carrefour has put much priority to its customers, and as such, it hasoffered extensive training to its personnel to give quality services.
Inconclusion, even though Carrefour began as a small retail store, andnot a hypermarket in the 1960, it is clear that it has grown to beone of the largest hypermarkets as it has extended its wings beyondEurope to control the global retail chain stores in the world with itover 16,000 hypermarkets globally. It is one of the largest retailchain stores after Walmart in terms of revenues generated from theannual sales. Its growth is attributed to its strong missionstatement always to be the best in the market. The company is stillgrowing and expects to open more branches all over the world beyondthe 39 countries where it operates. Similarly, it operationalmanagement as well as its operating strategy has helped it climbabove other players in the ladder of the retail industry. Lastly, itsnetwork communication across the globe and competitive strategy, aswell as its high improved productivity and higher quality servicesrendered to the customers, has maintained is competitiveness in theretail industry.
Christopher,M. (2016). Logistics& supply chain management.Pearson Higher Ed.
McDermott,M. C. (2012). U-Turn at Carrefour:`De-globalization`and ForeignDivestment. TheGlobal Journal of Finance and Economics, 9(2),149-160.
Network,B. (2012). Mission & Vision 5.
Zoe,Z. Y. (2012). Management Strategies of Carrefour and Ito-Yokado inChina: A Comparative Study. InternationalJournal of Business Anthropology, 3(1),134.