More than a concrete set of developments, the first quarter of 2015 has been more the continuation of the basic structures laid down over past quarters and a pointer towards the key strategic directions to be expected from Carrefour in 2015.
On Carrefour’sQ1 2015 results, Gildas Aitamer, Retail Analyst at Planet Retail, commented: “We do not expect any significant sequential changes in Carrefour’s performances this quarter, with key formats in France remaining in positive territories excluding petrol, while Italy and China remain the retailer’s pain points.
“We believe Brazil will continue to drive the group’s growth, but we would be particularly cautious, given a slowing economy and intensifying competition from rivals, for example Casino’s efforts at its Extra hypermarkets. Even so, we believe the country has considerable potential for Carrefour, which it could further develop by growing its convenience presence while attracting regional store chains, either in franchise or via minor acquisitions - as of late it has done in Poland and Turkey.
“In France, the recruitment of several hypermarket owners is a sign that the Carrefour proposition is attractive to independents, a clear indication to us that the retailer is very much back in the game. This, combined with the major acquisition of the Dia store network, will help Carrefour assert its position amid a perennially difficult trading environment - should it manage to staunch the network’s collapsing sales, that is.
“While we don’t expect the effects to be fully felt this quarter, we will be paying close attention to how the cards fall following the reshuffling of the pack initiated by Carrefour’s rivals' purchasing alliances. This will likely result in a somewhat homogenous buying climate, making more efficient supply chain and tighter cost structures all the more vital to differentiate price-wise from competitors.
“Meanwhile, Carrefour is clearly seeking to step up its e-commerce proposition in a number of markets, but we believe that the priority remains its bricks and mortar operations. The retailer is likely to favour traffic-generating online strategies such as click & collect for China and Brazil later this year, following a similar roll-out in France. Domestically, Carrefour is amassing crucial online expertise by bringing in high profile hires, best illustrated this quarter by the arrival of former MD of online flash sales company Vente-Privée.”
Source: Planet Retail
