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Carrefour's expansion in China

By Tuo Yannan (China Daily)
Updated: 2008-08-12 11:20

That experience has given Carrefour the confidence to expand into other cities. "Now we have 60 percent of our supermarkets in the main cities, like Beijing, Shanghai and Nanjing, while the rest are located in the western and northern provinces," Legros says. "We want to strike a balance in store distribution."

In the pursuit of expansion, Carrefour faces different competitors in different cities.

"China is a large country, when we think about the Chinese market, we think of it like Europe. In Europe, you have competitors in Germany, you have good retailers in France, and so on.

"The Chinese market is the same. In Beijing, WuMart is good here, and in Shanghai it's Bailian. In Chongqing it would be New-Century. In any city of China, there is always a very good professional local retailer, who generally has a much bigger market share than us.

"This is why we should localize. We need to adapt in every city we enter in China, because every city has it own feature. Beijing is not the same for us as Shanghai, and other cities also," Legros explains.

Carrefour has always believed that a successful supermarket should provide low prices for most items. "There is an international rule: people rich or poor like to buy good products at lower prices," says Jean-Luc Chereau, a former CEO of Carrefour China, "For the rich people, they will pay lower prices, they save money and can spend it for other things, such as traveling, entertainment, or real estate. For the poor people, they have no choice but to buy their necessities at the best price."

"If you went to Chongqing Carrefour any time of the day, you can find both rich people and poor people shopping for what they need or want," says Legros. "If you go to Beijing's Zhongguancun Carrefour on the weekend, you can also find the same mix of people there. Two months ago we had one million customers in a single day in Carrefour China. Chinese people have the confidence in us and such confidence is our real asset."

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