CARREFOUR CASE STUDY

Presented by: TEAM 2 SHONE KURIAKOSE SRIRAM SAHOO

Introduction
Largest retailer in Europe Second largest retailer in the world Various retail business 22nd of the top Fortune 500 companies 11,000 stores 420,000 employees More than 30 countries and areas

Industry Analysis

3 essential reasons why hypermarkets stand out from typical supermarkets and retail chains: 1)Products 2)Location 3)Prices

Global Issues

Diversity and cultures of new area

Government Regulations Pressure on smaller companies

Risks

Competition
Location

Future Trends

Technology
Online shopping

STRENGTHS Hypermarket's Advantages

Diverse products
Convenient location Possibly low price

Large Economic Scale

Great number of stores 11,594 in Europe 835 in Americas 471 in Asia 5 in Africa High speed of setting-up new stores

Weaknesses

Product issues Low end products Increased obligations of quality

Monopoly to suppliers

Opportunities
Online stores

Reduce capital expenditures

Land costs Labor costs

Increase trade efficiency

Global Expansion

Carrefour: 50% of its sales in the international checkout

Located

in 29 countries

Wal-Mart: 16% of its sales outside of America

Located

in 11 countries

Threats

Severe working environment unconcerned relationship between employers and employees

Globalization competition from big retailers as well as local stores

Indirect Competition
Convenience Stores - general merchandise and various supermarket items Shopping Centers - variety of items all in one location Grocery Stores - sell food items

Direct Competition

Auchan - French grocery chain E. Leclerc - cooperation of over 550 food retail franchises Aldi - European discount chain Ahold - largest grocery retailer in Amsterdam Tesco - Britains largest retailer of grocery and general merchandise Wal-Mart - world's number one retailer

FINANCIAL ANALYSIS
PROBLEMS 1.The 4 currencies in which carefour had been dealing had come down 2.The rate of euro also has depreiciated over the years. 3. Sales came down in 2002.

ISSUES TO BE HANDLED
Whether carrefour should continue paying foreign debt in the euro denominated currency.

ANALYSIS OF THE GRAPH

In 1996 UK currency inflation is more than 3% , it declines to less 1.5 % , and again rises in 2002 to 3 %. In 1996 US currency inflation is around 2%, it declines in 1998 and than rises in 2001 more than 2 % , and again fall in 2003 below 1% France currency starts with 1.5 % than falls down to 0.5 % in 1999 and rises to 2.5 % and again falls to 1.3 % in 2003. Swiss currency starts with 0.5 % and rises to 1.9 % in 2003.

SOLUTION
Carrefour should continue dealing with euro denominated currency for its payment since most of its operations are in european countries Irrespective of current trends the euro value would come up. It should stop dealing in bonds in uk and us currencies since it had a negative trend all these years and continue dealing in france and swiss since they have low interest rates