How Did the Company’s Improvement Initiative Identify Market Opportunities and Business Expansion?

The improvement in technology will allow Carrefour to perform better analysis of data related to their store’s performance and use them to analyze and evaluate merchandizing plans and sales results which increased the understanding of store performance.

By looking at key drivers such as inventory levels, sales margins, and inventory receipts, operations managers are better able to understand and locate the success and risk factors. For example, Operation managers can quickly respond to underperforming store with the inventory information and they can measure the true profitability of the stores. This understanding comes about by taking into account the role of other factors such as fixed costs, which often distort results about store performance, particularly of newer stores.

The introduction of EDI connection with top suppliers which establishes full-two way, live, electronic inter-connection with most of its 3,000 suppliers will allow Carrefour have a good relationship with the suppliers which Carrefour respond fast to suppliers, hence the inventory-holding periods in stores can decrease dramatically.

With the IT improvement, Carrefour is now better able to determine what initiatives to invest in and where expansions make sense. This improvement allows Carrefour to improve its supply chain, which is enabling Carrefour to offer low prices.

The price is the important factor that influences consumer’s purchase behavior. With the low price strategy, Carrefour can attract more customer than other competitors in the market.

The retailing business like Carrefour will incurs high level of management of operation costs. Thus, minimization of the operating costs is important for the profitability of the retails business. Carrefour has achieved by redesign the distribution network which involved consolidation of 31 distribution center to 9 regional distributions centers and the introductions of 4 national distribution centers where goods are received directly from...