Carrefour

Carrefour

Carrefour is the second largest and more successful hypermarket company in the world behind Wal-Mart. In Europe is the hypermarket with more revenues and sales. Carrefour has presence in 30 countries around the world and owns 12.028 stores worldwide (Carrefour, 2006). Carrefour founded the idea of retail-shop which means food- retailers and contains supermarkets, hypermarkets, hard discount, convenience stores, cash and carry, and e-commerce.

Carrefour was created in 1959 by the Fournier and Defforey families. They opened their first store on the year of 1960 in Annecy, Haute-Savoie. The history of Carrefour can’t be tracked only focusing on Carrefour itself, is has to be tracked following at the same time the history of their best business partner Promodes. Through history Promodes and Carrefour have been competitors in the food-retail market but any of those companies were not successful until their alliance in 1999. In 1963 Carrefour opened their first hypermarket surprising the world with this new concept, meanwhile Promodes in 1972 introduced the concept of “convenience store” to the food market. In 1990 both companies realized that good quality was not enough for the costumer so they decided to offer hard discounts in their businesses. During the 80’s decade competition from outside Europe tried to enter to the market with new ideas and cheaper prices, a combination that both companies couldn’t handle forcing them to merge in an alliance in the year of 1999.

The first couple of years weren’t easy for this new company named Carrefour Group because the original companies had different goals; Promodes for instance had a lot of different signs and franchises, and their goal was optimize productivity, purchasing and logistic. Carrefour in the other side was more interested in their costumer service and their marketing within Europe. Finally they figured out how to mix both cultures and give shape to a new one more strong and global becoming one huge organization called Carrefour Group. Even though the Carrefour Group took time to get used to the new company’s goals, is in these days they are the second largest retailer in the world.

Carrefour has two ways to expand their brand around the world; they use Direct Ownership and Franchisees. Mostly Carrefour use Direct Ownership to go globally and even regionally, this strategy has a high risk for the investor but at the same time this risk is rewarded by high profitability. Carrefour has the capital to take this type of risks, for this reason they like to open their new stores after a meticulous market investigation and manage them by themselves. The other type of expansion is through Franchisees, this expansion strategy is less riskily than the Ownership. Carrefour in the present has 4.311 franchise stores in 19 countries which are more than the 50% of the countries that they have participation in.

In order to maintain the credibility and the name of the brand, Carrefour has rules for the franchisees and they make sure they are being accomplished by sending trainers, advising the franchiser with experts and by regulating the shares that go to the sale market making with this process a win-win relationship with the franchisees. Training are available when a franchisee is accepted, manager from the high level stores are sent to these other places in order to better train their employees to best fit the organization goal and standard.

Carrefour’s general organizational structure is divided in two big groups that have to report how the company performs around the world to the Management Board Members and they are the Functional and Operational Departments. The functional department is integrated by a human resources department, organization, systems & supply chain department, financial management department, sales department and a food marketing department. In the other hand the operational department is integrated by a supermarkets - France convenience/cash & carry France department, Italy department, Belgium department, Spain department, china department, DIA Spain department, DIA Europe department, Other European Countries department, Other Asian Countries, department and a Latin America department.

This structure shows how Carrefour manages their international business; they have a single department to know and to control the operations in other countries and/or regions, the big decisions are made by the two parties operation and functional department, by that it is better to merge into only one idea; nevertheless small issues are dealt by the region VP.

Depending in the country and the culture that the store is working with, the organizational