Careefour

Hellal Mariem

Erasmus Student Number: 069092107

Word count: 9722 words

ACE 3002: Strategic Marketing

The internationalisation of Carrefour

[pic]

A marketing critic of Carrefour’s international expansion

Executive summary:

Carrefour opened its first hypermarket in Spain in 1973. It is the first store out of its domestic market. After that Carrefour gradually spread across the world in three main geographic areas: Europe, Latin America and Asia. Now Carrefour, the world’s second largest retailer after Wal-Mart has announced this year a net profit increase of 10,8 percent to 706 million euros. This improvement is due to an aggressive price reduction and the will to attract new customers across the world by opening new stores. These results exceed most analysts’ expectations. In France, sales grow 6, 3 percent to 17, 94 billion euros and overall. Moreover, more than a half (almost 52 percent) of the Carrefour consolidated net sales in 2005 is made out of its domestic market. “We are growing faster in a more targeted way” said the Chief executive officer who confirmed also that Carrefour was in line to open 100 hypermarkets before yearend.

With the emergent market, which is represented by the Chinese market for instance, Carrefour sees in the Asia-pacific area the ability to develop its activities and to increase its revenue. Their overseas expansion focuses on a few key emerging markets. These markets, which offered growth opportunities, are characterized by the need to have retail structures. Carrefour’s marketing strategies is mainly to strengthen its position by increasing the number of overseas store and by cutting prices. The aim is to develop the Carrefour brand worldwide. Thus the challenge is to success the development of the Carrefour network in Latin America, Asia and especially in China.

Nowadays Carrefour has to be confronted to increasingly strong competitors like Wal-Mart or Tesco. Therefore it has to develop international...