Retail news: Carrefour expansion

Successful trials in Spain have persuaded French retail giant Carrefour that the Carrefour brand, as opposed to its underperforming Champion international brand, works well as an express-style format in mature markets and as a
mini-hypermarket in local neighbourhoods.

The company trialled three new formats in Spain, its largest market outside France, through 2005 – Carrefour branded mini-hypermarkets of 3,000-4,000 square metres, Carrefour Express soft discount supermarkets of 1,500 square metres and Maxi-Dia discount stores carrying only private label products.

Carrefour claims all formats have been successful with incremental sales of 40% in each category. “We are having much better sales per square metre [in Spain] and with the synergies we are obtaining with one brand we are lowering our costs,” said Carrefour’s chairman José Luis Duran. “We can grow quicker in terms of organic expansion with new formats.”

Carrefour plans to invest €10 billion in its overseas expansion programme over the next three years. Nearly half of the 100 planned hypermarkets will be built in Asia, with an average of 23 stores opening each year in China until 2008. Brazil, Italy and Turkey have also been earmarked for development.

© db July 2006