Carrefour

Topics: Carrefour, Hypermarket, China Pages: 3 (961 words) Published: July 31, 2013
What is the biggest competitive threat facing Carrefour as it expands in global markets? Carrefour had a concept of been a giant store(hypermarket) but along the line, the company faced some challenges which they found difficult to adapt to easily, Some of the challenges were due to changing consumer consumption habits and Carrefour could not meet up with this challenge because of the little depths in some of their product categories. Carrefour also pulled out from the American market because retailing channels were quite diverse. They were long entrenched shopping malls, discount stores and whole sale clubs such as Pace and Sam that were offering rock bottom prices, other category killers that offer tremendous depth in certain product categories which was not the case with Carrefour. Another major problem with Carrefour was the size of their shop which was considered too big and too overwhelming by their customers and at the same time not offering much product depths, the Company tried to rectify this problem in other markets by opening new formats like mini hyper and Carrefour express. The executives of Carrefour also made a huge mistake that played right into the hands of their competitors Royal Ahold NV in their quest to build a global brand by changing the names of hundreds of Promodes shops they acquired, this made a lot of consumers not to identify with the brand because they got confused and preferred associating with local brand names. There was also competition from Aldi and other hard discounter chains that sold private label brands cheaper than Carrefour. Some competitive challenges did arise from real estate value of Carrefour stores which was expensive and this will make it quite difficult to sell at cheaper rates. Cost of living was also a problem especially in China. The cost of living do affect the price of products. Another major competitive threat is the international expansion by foreign Competitors like...
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