SWOT Analysis of Carrefour (Carrefour SWOT)
This is a detailed SWOT analysis of Carrefour. It aims to provide the readers with significant insights into the strengths and the weaknesses of Carrefour. It also aims to examine a number of potential opportunities and threats that the company should explore and diagnose to keep its operations smooth and grow further. Carrefour is a French retail specialist multinational corporation. It opened its first supermarket in 1960 (Carrefour, 2021).
Strengths of Carrefour
Carrefour is one of the leading brands in the retail sector. It is one of the world’s largest retailers of groceries and consumer items. It has a strong brand reputation, and its products are of affordable prices and good quality.
Carrefour invests heavily on training and developing its workforce which has resulted in its employees becoming highly skilled and motivated. It has a large product portfolio and offers products in many different categories. It also sells products with its own brand name. This too helps increase revenue for the company.
Carrefour has a large number of grocery and convenience stores, cash and carry, discount stores and hypermarkets. It has 12,225 stores in over 30 countries (Carrefour, 2021). This massive operation has enabled it to attract more customers and increase sales.
The turnover of Carrefour in 2019 was around €80.7 billion in. The company believes in continuous innovation and was awarded the ‘2017 Open Innovation Award’. Likewise, Carrefour Polska won two awards in the ‘Retailer of the Year – Chosen by Suppliers’ competition in 2020.
Weaknesses of Carrefour
Weakness is the next point to discuss in the SWOT analysis of Carrefour. Carrefour had to close down some of its stores in some countries (for example Singapore). Likewise, it announced selling 80% of its Chinese retailing operation to a local operator in 2019 with further plans to exit the country entirely in the future (Shoulberg, 2019).
Carrefour has limited presence in some emerging economies of Asia and Africa and its performance has been weak in some Asian markets. Likewise, some of its own products have not performed well which has resulted in less revenue and more costs for the company.
Opportunities for Carrefour
The opportunity to open stores in emerging markets is out there which Carrefour should explore. This will offer it an opportunity to run operations with low operation and staff costs.
Carrefour has a good opportunity to boost sales by trying to increase the sales of its products online. Through this, it can reach a wider number of customers in different parts of the world as well. Likewise, new and innovative methods of advertising and marketing can increase demand.
Strategic alliance with other companies can help Carrefour reduce costs and attract more customers which in turn can generate more income. Its plan to form a strategic alliance with the largest British retail giant Tesco is aimed to reduce costs and offer customers lower prices (BBC, 2018).
Threats to Carrefour
Since Carrefour operates in different countries, it is exposed to the risk of foreign exchange fluctuations. Likewise, rising labor costs results in an increase in costs which will result in having to increase the price of the products.
Changes in Government regulations in the countries in which Carrefour operates can affect it and at times can result in having to incur additional expenses. Likewise, the increase in number of discount stores results in Carrefour losing customers.
Changes in consumer preferences and customers opting to shop more locally and switching to other retail stores are big issues of concern. Particularly, at a time of global lockdown, many consumers are buying necessary items only. This this may result in lower sales for Carrefour (Noronha, 2020).
Carrefour faces a number of giant competitors in different markets. Amazon, Tesco, Lidl, Walmart, Costco, Aldi, Publix, and Kroger are some of the big names in this regard.
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Last update: 22 January 2021
BBC (2018) Tesco and Carrefour say ‘strategic alliance’ will cut prices, available at: https://www.bbc.co.uk/news/business-44679884 (accessed 22 January 2021)
Carrefour (2021) Carrefour Group, available at: https://www.carrefour.com/en/group/history (accessed 21 January 2021)
Noronha, M. (2020) The Influential Shopper, available at: https://eiuperspectives.economist.com/marketing/influential-shopper (accessed 15 January 2021)
Shoulberg, W. (2019) Carrefour Is The Latest Victim Of The China Retail Syndrome, available at: https://www.forbes.com/sites/warrenshoulberg/2019/06/24/carrefour-is-the-latest-victim-of-the-china-retail-syndrome/ (accessed 21 January 2021)
Photo credit: Carrefour Kenya
Author: Fahim Shah
Fahim Shah has been working in the UK as a visiting lecturer in Business and Tourism for the last 10 years. After completing a Bachelor’s degree in Business and Marketing, he went on to gain an MBA from the University of Bradford, the UK. He is a Fellow of Advance HE (FHEA) and a full member of the Association of Business Executives (ABE).