Carrefour Dilemma March 11

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Carrefour Dilemma March 11, 2010, for Europe's largest, second largest international retail chain

Carrefour, is a black day. It is in this day, completely out of the Carrefour Japan - Carrefour in Japan All 6

stores renamed as "Aeon", which also means that Carrefour's 10 years in the Japanese market

ignominious end sadly hard to leave. However, this is not the aspect of this global market was the most

hurt the retail speculators the beginning, it should not end. Carrefour signs of defeat, the terminal in the

highly competitive retail market, will face a worse situation. Meanwhile, Carrefour has just produced is

not satisfactory earnings in 2009 In 2009, Carrefour profit dropped by 70% to 3.85 billion euros, sales fell

1.2% to 860 million euros. France, Europe and Asia are the decline in revenue, only the Latin American

market achieved revenue growth. In fact, the plight of Carrefour a long time, many markets around the

world are the last to leave an end in 1993, when Carrefour was forced to launch the world's largest retail

market - the U.S. market, only two stores in the United States after another was closed in 1999,

struggled in the Hong Kong market after more than 3 years, also announced its withdrawal from its four

stores in Hong Kong in September 18, 2000 closed down across the board, a loss of 3 million, in 2004,

Carrefour sold in Portuguese retailer ModeloContinente 22% of the shares, and sold in Spain, Argentina

and Brazil, 57 supermarkets, Carrefour withdraw from the Czech Republic in 2005, its 11 supermarkets

in the Czech Republic and 4 stores in Slovakia transferred to TESCO In 2005, Carrefour sold to the

Mexican competitors Chedraui 31 in local shops, in 2006, ten years into South Korea, Carrefour exit

South Korea, in 2007, Carrefour hypermarkets selling master Distributies AG50% of the shares of

companies exit the Swiss market in October 2009 to exit the Russian market, but this time, newly

opened in Russia from the Carrefour supermarket less than half the first time, while the second

supermarket in the just opened in January among the .2010 southern Italy has quit markets, off 21

stores in Belgium. But in China, has also been reported that Carrefour will exit the Chinese market, were

subjected to negative Carrefour, Carrefour in the Chinese market thriving, but the time has gone.

In a series of market rout in front of Carrefour seems tired filling, although in China, Brazil, Argentina

and other developing markets, Carrefour is still in a relatively advantageous position, but this relative

advantage in front of a huge market variables, Carrefour seems did not catch the last straw. the

successive contraction of both the strategic or just the tactical adjustments Ye Hao, Carrefour had to

face the bitter fruit of the global market debacle.

Carrefour's defeat was not accidental, as a Fortune 500 company, the world second only to

multinational retail giant Wal-Mart, or any measure of market behavior has its profound reasons, the

plot should be a tumor disease successive defeat of the Carrefour core factors. The summary of

successive defeat in the cause of Carrefour, it should broadly include the following:

1, equity volatility, managers frequently change



Relevant information, in 2008, Carrefour Group is no longer the whole Harley founding family

ownership, quit the board of supervisors, France and the United States Private

Arnault group together to become the largest shareholder capital. As "blue

capital" of the actual controller, Bernard Germany Arnot increased control of Carrefour, a series of

personnel changes. This includes the executive vice president of marketing, Nestle, Lars CrioloFusong

as chief executive of Carrefour. Durand outgoing CEO of the main The reason is because of poor

performance and his group and the conflict between major shareholders caused. Chief Financial Officer

of the helm but also from Germany, Schneider Electric PierreBouchut replaced EricReiss.

Halley family and focus on retail, the new top shareholder in Carrefour, the world's poor performance in

the case, wants to sell pArt of its business to return the funds to do other investments, so there will

want to sell some of Carrefour, said to withdraw from emerging markets including China, market

rumors. and Carrefour can not enter the top three in the regional market to the idea of withdrawal, but

also a Carrefour out one of the reasons some of the overseas markets.

2, not suited to local Culture

Carrefour in the course of business over-reliance on the French-style management. From general

manager to Marketing personnel, including many middle managers are sent from France, not only

increased the personnel costs, but because of language and cultural differences, difficult to understand

and master the French employees local consumer groups consumer psychology. These factors lead to

huge losses Carrefour management rigid and, last not withdraw from the market.

In the Japanese market, the French store Carrefour copy mode, the whole store into a typical French

atmosphere created with a completely different style supermarkets in Japan, while the degree in terms

of cleanliness and tidiness is not the local supermarket, such as Japan, leading to the final debacle. In

Hong Kong, Carrefour's "one-stop" shopping approach is not suitable for Hong Kong is so densely

populated shopping environment. Carrefour shopping philosophy is based on the spacious, with an inch

of gold patch of land in Hong Kong runs counter to the social environment is clearly inappropriate use of

resources. This Carrefour that reflects the community in adapting to the environment and the lack of deficiencies, so toss a few years in Hong Kong, Carrefour has shown significant not meet, but did not

take the initiative to change, only in TuenMun, Yuen Long, Tsuen Wan and HengFaChuen opened four

stores, and in the most densely populated Kowloon area, but no almost deprived.



In the Chinese market has always been in the Chinese retail market dominated by single-store sales

were from Taiwan, Carrefour retail "dark horse" RT-catch. Carrefour 252 million of single-store sales, RT

this data has reached 333 million yuan. And now, as Wal-MArt entered the Chinese market has reached

the shop number 158, but only 139 Carrefour stores. Carrefour in the Chinese mainland market has

always been proud of the number of stores and single-store sales were both RT-MArt Wal-Mart and

beyond, in a more passive position. Meanwhile, in the Chinese market has also taken place in the

National People's boycott of Carrefour's major events, making the Carrefour brand image and sales

suffered a huge blow .

3, excessive squeezing suppliers, unsustainable profit

Shanghai Business Information Centre Satisfaction Survey Supplier issued by the Office of the <<2009

Supplier Satisfaction Survey>> shows that although Carrefour slotting allowance, management fees,display fees, promotional fees, festival fees, DM fees cost a lot scores fell by 0.15 points last year, but

still ranks "top."

Reflect the many suppliers, Carrefour is recognized as the Industry has always been the most charges

retailers, Carrefour about two-thirds margin from the supplier, there are Statistics show that the various

suppliers were charged slotting allowance, to achieve its business in the Carrefour the amount of 36%.

and in mature markets, suppliers are concentrated in a few large enterprises, the right to speak lies in

the hands of suppliers, it is impossible to pay the high cost of Carrefour. and this huge amount of

slotting allowances charged to the supplier's Carrefour profit model will help short-term benefits,

however, it is difficult to develop a mature market, which is the Carrefour was forced to withdraw from

the U.S., Russia and other market reasons. Meanwhile, in the Chinese market, Carrefour has been the

high slotting allowance strong resistance from suppliers, in early June 2003, the Chinese "fried

Association" s Amin, Taiwan Feng, contact contact, is forest, Alishan, a great big, Liu and other 9 have

business dealings with the executive director of Carrefour will Carrefour enterprises to suspend the

supply, making the originally mutually dependent suppliers and retailers, accounting for their

opposition, it also raised the supplier of Carrefour's deep-seated contradictions.

In the retail terminal, the Carrefour adopted a low-cost competitive strategy, this low-cost competition

is at the expense of suppliers based on the interests, therefore, a simple low-cost competition to win

market share and profitability can not establish long-term mechanism, while price competition caused

by blindly the interests of suppliers also caused damage in the upstream Industry chain Carrefour and

suppliers do not form a strategic alliance of interest, but purely commercial trading relationship, and this

simple trading relationship is very fragile, and once or suppliers to find a better balanced with its sales



channel system, the supplier of Carrefour abandonment is obvious, which Carrefour, it will be the root

of the problem of mourning.

4, lower trust in the brand, leading brand crisis

Product quality is the life. As Carrefour, it should be well versed in this. However, Carrefour does not

seem to be "low quality" in the end. In charge of large suppliers slotting allowance at the same time,

accompanied by is shoddy, loss of interest in the things consumers have occurred .2006 April, the

Shanghai Carrefour and Louis Vuitton handbags sold similar extremely cheap handbags, by the court

Panpei 30 million, in May, Carrefour due to selling expired meat and food monitoring by Shanghai

Bureau of Quality Supervision Bureau to a fine of more than 53,000 yuan, 6 months, the international

environmental protection organization "Green Peace" found in Guangzhou, the three supermarket

chains Carrefour and other fruits and vegetables sold 25% contain banned pesticide residues,September, Hangzhou Carrefour sold coliforms, colony count and mold count exceeded three indicators

serious "problems sushi" by the business department of 11 months, Su Beijing Zhongguancun Carrefour

store to buy from a box of apple banana powder, 5 month-old baby vomiting after eating, even found

this box of goods has expired. This kind of disregard for the interests of consumers is the result of

consumers abandoning Carrefour away.

Meanwhile, Carrefour 2005 retreat from South Korea and Japan, is also considered the decreased trust

in their brands. Carrefour count on in this regard reflects the scale advantages, home arrogant disregard

the interests of consumers of psychological, but also highlights the Carrefour purchasing, quality

inspection, safety inspections and other management shortcomings and gaps.

Carrefour Renaissance, Where?

Carrefour in trouble for it, now is not to the point of no intractable. Predators as a global retail market,

Carrefour goods relying on the deployment system of globalization and achieve the shortest path of

circulation, the best, which maintain the product The price advantage is still quite large and so the corecompetitiveness. In China, Brazil and other emerging markets in developing countries, Carrefour still

maintain relatively good growth. the face of aggressive global campaign Wal-Mart retail boss, in the face

to RT-Mart and other local retail giants to lose ground in China, Carrefour is the taste of really having a

hard time before and after the attack. Perhaps, only to face the real problem, and adjust its Marketing

Strategy to adapt to the changing retail market, Carrefour's revival Road will not seem so long.



1, the clear market positioning

As the world's second-largest retail giant Carrefour in the heart of the business circles hope to bring

consumers the convenience of shopping, where consumers can hope to buy cheap goods. However, this

market position can not meet the consumption environment changes and changes in consumer

shopping habits. as Carrefour, the strategic mode of adjustment has become a top priority. For

consumers, the hypermarket model and can not bear with everything. For Carrefour, in the face of Wal-

Mart, RT-Mart and other retail heavyweights of the competition, must establish its own unique market

positioning, market positioning that is implanted in the mind of consumers of resources, can not be

replaced. such as Wal-Mart's "Sam's Club," has become Wal-Mart's own market positioning of the

distinctive characteristics, RT is also integrated into the high-cost consumers place frequented shopping.

And Carrefour addition to the powerful reputation, in their own market position and did not establish

own unique personality, so that consumers can not produce consumer associations.

2, localized Marketing Strategy

Of Carrefour in Japan, South Korea, the sink like a stone, a large part of the reason is not close to the

local market, there is no local market for the unique market environment changes accordingly, the

results have paid a heavy price.

Localization of any multinational Marketing is a necessary Strategy of transnational operations. Any

geographical region has obvious characteristics of consumer groups, and these groups is characterized

by a long history of sedimentation in the formation of culture. Different nationalities, different customs

and habits, different level of income will lead to different consumption habits of consumers and

consumer characteristics.

As for Carrefour, to take close to the localization of Marketing strategies, will reduce the barriersbetween consumer communication, adherence to the "Localization, localization service" in an effort to

itself as a localized company in the layout of stores , product promotion, product display, product

introduction, etc. for different countries, different regional markets, different strategies in order to

please consumers, in order to win broad consumer resonance.



3, the shape for the supply of zero-win-win system of cooperation

As retail businesses, the relationship between suppliers and retailers should be the relationship between

fish and water coexist. In it, the retail business as a carrier of the role, to provide space to display and

sell to retailers, to provide products and services to to the end consumer, in order to achieve the

transfer of the value of product trial.

At present, Carrefour was proud to fortune "high admission" has increasingly become a barrier to the

Development of Carrefour. Many suppliers unilaterally imposed on the high entrance fee Carrefour

expressed great indignation, some of suppliers even taken counter-measures. This is for both sides, is a

negative outcome.

Therefore, Carrefour, how to create a harmonious, win-win cooperation in the supply system is to

enhance the competitiveness of the important magic Carrefour. As upstream suppliers, Carrefour should

be fully goodwill, the spirit of win-win mentality and suppliers, equal footing, reduce or suspend the

admission widely criticized, not for profit should be placed on the admission charge. but rather by

strengthening the management, control costs, develop new market space to pursue their own profit

margin implementation, to achieve win-win situation with suppliers to create win-win value chain

system.

4, establish a service-oriented retail brands

The retail Industry is the industry directly to end consumers, but also the most competitive industries.

The competition in the retail industry, the service level will be to determine the quality of the retail

enterprise is the driving force for sustainable development. No good service to there is no customer

loyalty, there is no customer loyalty, there is no brand reputation, brand reputation is not, it can not

produce sustainable purchasing power. as a global retail giant Carrefour, in the face of changing market

front, dragging tired huge body, rigid dogma, the process cumbersome, as the center of its own, can not

respond quickly to market changes and customer needs, not establish a strong service brand. consumerawareness of Carrefour or remain in the "big" above, but deep from the heart does not agree with its

"good", including the products and services.

As Carrefour, the abandon prejudice and short on consumers as to seriously study the behavior of

consumers, from their own service began, by means of Carrefour a strong brand awareness, build a



strong alternative service can not be copied and advantages, Carrefour started service brand in the

minds of consumers establish a "large-scale supermarkets, service Carrefour best" brand reputation,

Carrefour, the first being that hobbled cow, must be able to shine with new luster, and no doubt will

find themselves lost now, but still for the smooth road.

Change the channel of retail Marketing model

Carrefour's defeat is only a microcosm. It reflects the market in today's competitive environment, retail

enterprises are facing difficulties. As a former Swordsman's Carrefour, and now face the embarrassment

of bad after the power. Is the world's largest retail predators Wal-Mart, in the Korean market has also

suffered a capsize of the storm. Even as the China market, the highest single-store sales, known as the

retail industry "dark horse" of the RT-Mart, opened its first store in Beijing on the occasion, said

themselves as "Beijing exam", quite warrior's spirit, in fact, also revealed a number of sad andlimitations. Indeed, in the midst of the retail industry, the slightest mistake will lead to round loser in the

end. At the same time , as the market environment changes, only the initiative to change the retail

business in the dynamic Development of marketing needs to grasp the change accurate insight into the

retail needs of the profound changes in marketing mode in order to shape their own in the market,

competitive advantage, maintain competition in the market force.

1, specifically the essence of community supermarket model

Community supermarket model is adapted to modern living patterns of people born, it "shopping on the

home front," the marketing concept as the preferred shopping community. As the community

supermarket, small footprint, and consumers articles closely related to daily life consumer-led, not for

"large", but focus on "special and fine" to the consumer homes to meet consumer demand as the goal

itself, provide daily necessities of the purchase and consumption. Therefore, with a strong incomparable

vitality and rapid large-scale supermarkets, fine, flexible. The very large supermarket "Miscellaneous and

not fine," the problem is becoming more evident. With the diversity of customer requirements and

personalization, large supermarket rigid layout, product single growing increasingly dissatisfied

customers.

Currently, Seven-eleven, wedding and more fast passenger the Development of supermarkets and

other community supermarkets are springing up, showing a strong momentum of development. As a

large supermarket, the shopping district in the realization of a wide range of coverage at the same time,

you can take "1 Big + N small "channel development model, that is one large supermarket to meet



consumer demand for large-scale procurement, community residential area supermarkets to achieve

the depth of coverage, the formation of three-dimensional super coverage, both to improve the

consumer shopping convenience also enhance the convenience of consumer services. In this regard, the

walk in front of the supermarket and RT-Mart supermarket, both large super

supermarket, there are a small community-based supermarket. and control of RT-Mart supermarket

Ruentex Group, is the happy event more community behind the supermarket owner, and RT-Mart is the

same to her parents. The chief executive of the troubled Carrefour Group, said Lars Criolo Fu Song,

taking into account changes in the market, Carrefour hypermarkets will change the marketing model,

and strive to create a new supermarket model, and the implementation of a number of large

supermarkets, "downsizing."

2, buy underwriting model

Consumption of large supermarkets with extensive, high Population concentration, the characteristics of

large consumption of goods, therefore, is resistant to many product manufacturers to achieve the sales

channel and access road. As a production supplier, they want to show more of their products in the

consumer face to promote a greater degree of purchase. However, this decentralized model for the

large retail supermarket supply is not the most appropriate, which may cause the product to the vicious

competition, forced to cut prices and unprofitable retail supermarket .

Buyout underwriting model will allow suppliers and retailers to achieve maximum value chain

integration, the interests of both parties can be guaranteed. As exclusive realization of the product,

suppliers do not have to strike everywhere, scattered fighting effort, they do not face malicious lower

prices on retailers, retail supermarkets do not worry about a vicious price competition, to ensure stable

and adequate profits to promote the healthy development of enterprises. to take this marketing model

is represented by the RT-Mart.

In co-operation with suppliers, RT adopt a "nurturing" strategy, rice, fruit, pork and other categories

from the supplier side bag down to get the lowest price, while access to exclusive distribution

advantage. Such as the package under the Wuxi whole fruits Hill, signed a guarantee with the acquisitionof orchards to ensure that the purchase price and other contract documents, and for only the east to at

least 400 tons per day consumption of pork, RT adopted a way to get a slaughterhouse in Yangzhou

acquisition price advantage and independence for the position.

3, Club marketing model



Currently, most large supermarkets, the development has been a member of consumption in general,

free for members to do one card each, and then spend with your Card consumers can enjoy the points,

or enjoy the member price, a certain amount of points can be redeemed for gift or free coupons, is that

they generally take the marketing strategy for members and member feedback strategy. Trust-Martstores, such as payment of "Hung Lika" is part of this marketing model.

However, this membership card, consumption patterns, and for most consumers do not have much

appeal. They were just going to the supermarket, just remember to use the membership card, but

usually, membership cards are lying where to sleep.

Therefore, how to maximize the value of making membership cards, consumers are in the process of the

hundreds of cards, as consumers often use to produce a card-dependent, large supermarkets should

focus on marketing model needs to be considered. And in Among these, members of the club is a better

form of a marketing model. is the card issuer and the cardholder in the form of bundled into the club,

making the cardholder as a member of a club. And as the cardholder and member clubs members, in

addition to the above can enjoy member benefits, the members of the club members can also between

the organization and contacts in the supermarket, the club organizes various activities. For example you

can run cards in accordance with staff of different gender and age levels , the club members into

different organizations, each club organization and management of the organization in the supermarket,

you can initiate and organize activities. such as those for younger age groups, can organize driving,

Financial Management seminars, and even held a variety of financial knowledge , interesting as one of the various competitions, attracting people to actively participate. but also with banks to issue a joint

card, the consumer's personalized service, either as membership cards can also be used as a credit card

and consumer in the supermarket, can get double points or additional gifts in order to stabilize the link

between the consumer, making membership cards as the main tool for daily consumption of consumers,

so consumers have a huge centripetal force, so that consumers loyal to a supermarket customers.

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Carrefour Dilemma March 11