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Carrefour Company is a hypermarket which specializes mostly in groceries and retail items like: hardware, food items, clothing and other household goods. Its networks include; supermarkets, hypermarkets, convenience stores, online stores, discount stores and electronic commerce. Its wide variety of goods is a competitive tool and some of its competitors are: Wal-Mart, Tesco, Ahold and Aldi among others (Mao 202).
How the Company Went International
Carrefour’s mergence with Promodes SA in the year 2000 resulted in it becoming the leading operator in supermarkets in Europe. Its other areas of operation include: convenience stores, discount stores, hypermarkets and cash-and-carry outlets. Due to the creation of hypermarkets concept by its founder, the expanded supermarket (hypermarket) which was offering a wide range of merchandise like electronics, grocery among others, gave its consumers a chance to accomplish their major shopping objective at this store. These hypermarkets quickly became successful which in turn revolutionized the industry of retail shopping in France and the world at large (Kamm 43).
Carrefour Company started due to the collaboration of Marcel Fournier and Louis Defforey in Annecy city in France. This city was industrialized since the World War II. The two men were both from enterprisingly rich and successful families’ and thus had a determined will to expand their business enterprise capabilities. As a result, they embarked on building of large supermarkets. Fournier had connections with Casino Supermarket Company while Defforey was the president of the badin-Deforey, Lagnieu. At around 1950’s the grocery industry in France consisted mainly of family operations. At this particular time, big stores which were located within the city centers were inconvenient as they highly priced their luxury items and services which impelled consumers to seek alternative ways of shopping for such items. It was also at this time in moment that the concepts of free service became so prevalent in the supermarkets. Supermarket became popular of their ability to provide consumers with fresh produce and other wider variety of goods at very low prices than it was with the traditional stores. As a result, Fourier and Defforey employed the unexploited concepts to ensure the success of their store which was situated in Annecy. To be competitive in the market, they offered goods and services at seemingly low prices as possible to, a point which hindered their potential competitors from setting up business enterprises of the same nature. The company resorted to expand in Paris after Defforey travelled to the United States of America to examine the commercial structure of America (Johnson 25).
Carrefour Company resorted to involve itself with multiple companies in Europe and was also very determined to enter the Mediterranean region. In the course of its international growth, Carrefour carefully chose its potential consumers through the marketing of local products which were initially not exported to France. It partnered with local retailing stores and eventually fully owned these stores in matter of time. Due to the high inflation rates experienced in France during the 1970’s and the resultant imposition of the Royal law in 1973, Carrefour decided to expand its entire operation to the market in abroad countries. By 1978, its stores were performing well in the external markets of France and to be exact, it flourished in its Latin operations. It further experienced high profits in stores which were located in Brazil, Argentina and Spain. Despite double sales reported by Carrefour as compared to those by its competitors like Casino, Viniprix among others, its objective was to preserve its markets, financial and factors which were essential for its development. With its emphasis on quality, Carrefour made an introduction of private brands at low cost. It became France’s leading merchant in hypermarket and the top retailing company in European countries in the early. It employed the policy of decentralization and aimed at long term success. The company focused on its growth pattern aiming at the foreign markets. It moved into Mexico and established more than ten hypermarkets as a whole. Opting to grow further into the region, Carrefour opened ten hypermarkets in Chile. By mid of 1990’s, Carrefour’s operational stores were more experienced internationally than there were in the original country of origin.
2. Products and Services Offered by Carrefour Company
Carrefour Company offers goods such as food, household goods as well as clothing. Its hard discount stores reduced selections of products at certain discount prices. In addition to this, it also offers wholesale products for various businesses. Some of its additional services include online shopping. This is made possible through its cyber-markets online. Using this service, its customers are able to shop with them without necessarily going into their stores in person. Their online cyber link is dubbed as “Ooshop.com” which has its headquarters in Paris. Carrefour possesses the unique prepaid card option which is dubbed as “pay-as-you-go” card. This card offers the clients a direct access into the Carrefour mobile network. Clients can also make calls to the mobile telephone number provided to them until the prepaid services weaken. Other products include groceries, electronics and automotive supplies. With these great offers, consumers could accomplish most of their shopping at the Carrefour stores (Ellison A11).
3. Countries where Carrefour is Located
Carrefour is an international company with most of its stores situated in European countries. The countries include: France, where it originally started, The Great Britain, Italy where it is known as ITalware, Latin countries, Brazil, Argentina and Spain. In the late of 1980’s, Carrefour embarked on establishing its stores in the states of Philadelphia and Pennsylvania. It has continued to expand its operations in Austria, Netherlands, Africa and the United States of America. Carrefour further established new stores in Taiwan, Turkey and Malaysia. In doing so, Carrefour had an objective to control the world market in the products and services it offered. Mexico was not left out either. In late of 1990’s, Carrefour opened up new store in both Colombia and Chile. In Japan, new stores were also created including Beijing (Johnson 24).
4. Strategies Employed by Carrefour
Carrefour deployed certain strategies to ensure it was always ahead of its competitors. Some of its strategies include discount prices. This enabled its consumers to shop at a discount which was relative depending on the type of items they bought. This competitive advantage made consumers of certain products to prefer shopping with the Carrefour hypermarkets. Secondly, it opted to decentralize its power. This was in a bid to ensure its continued growth around the country and the globe at large. Its reduction on the emphasis about the aesthetics and cost of equipment was a royal strategy which kept its growth flourishing as a whole. Thirdly, it mainly emphasized on the quality of goods and customer service, something that attracted more and more consumers into their already established stores. Fourth, it accelerated the rotation of stocks. This ensured that at no particular time was there a diminished product in the stock. These strategies were appealing to the young, new suburban inhabitants and the budget conscious people who had already felt the full glare of the 1960’s inflation rates which were so high. It is wise to indicate that with the deployment of these strategies, Carrefour had an upper hand over its competitors (Bidlake 19).
5. Success and Failure of Carrefour
Carrefour has been very successful in setting up hypermarkets around the globe. Its success had a wave mainly in Europe where it established numerous stores until it resorted to go international. However, it was not successful in the US and closed its store, in the mid of 1990’s the company totally pulled out of the United States. The story was the same in Japan where the Carrefour Company hoped to take charge of Japan but it could not. It failed to adapt to the unique nature of the Japanese market. The small Japanese families were usually not conversant with the purchasing of large quantity goods and were also very peculiar especially when it came to their choosing of their food especially the vegetable and fish. Normally, they were perceived to purchase for a day at a time and as a result, Carrefour was not a better choice for them. The Carrefour’s success in other countries was prominent.
6. The Impact of Different Cultures On:
(I) Social Responsibility
Social responsibility is the ideology that any given entity has to abide by in order to benefit the society. A negative influence to shareholders usually results from the corporate social responsibility. The way people behave directly affects others in the immediate environment. Different cultures have their own ways of life which cannot be easily changed. When they interact, they have adverse effects on each other. Carrefour’s social responsibility was to ensure that people were comfortable and able to shop within their stores due their subsidized prices on their items. Both the rich and the poor at least had something to pick at these stores. It also made sure that it provided qualitative pieces of items o its customers at large.
Ethics is usually the common practices of different principles that are morally agreed upon. Cultural dimensions constitute the behavior of individuals in it. Therefore, each and every culture has their basic principles of operation that binds them. Carrefour had strong ethical ideologies that saw it grow day by day.
Communication is the passage of information from one person to another. People from different cultures have their own way of communicating. The Carrefour Company had to cope with the way of communication of the different cultures around the globe in order to expand their businesses in their regions.
Negotiation is a discreet form of argument amongst people in order to reach a desirable agreement which is favorable for everyone. When Carrefour Company was expanding, it had to negotiate with other existing businesses so that it could set a standard price on its items for its consumers. It had to determine what items are most preferred in certain region.
(V) Organization structure
Different cultures have their own different structures of organization. The organization structure of Carrefour Company made it more prosperous as compared to other companies. Its decentralization of power was a strategy that enabled it to climb to the top and subsequently developed a variety of cultures in its organization structure.
(VI) Human Resource Issues
Human resource links an organization to the outside environment and assists in selling the values of an organization. Due to a wider variety of culture available in Carrefour Company, it was able to establish its roots to many different countries around the world something that gave it an advantage over other companies.