View
214
Download
2
Embed Size (px)
Citation preview
Carrefour
Establish in France since 1963. Own over 5200 branch store in 26
countries and region. About 36.3 billion of the sale amount and
earn 7 thousand million profit. More than 240,000 thousand employee.
The sale feature of Carrefour
Hypermarket Various products (including household
appliances) Giant size Giant quantities
Carrefour in Hong Kong
Entrance in 1997 Own 4 branch store in Tuen Mun,
Yuen Long, Tsuen Wan, Hang Fa Chuen.
Unfortunately, all closed in 2000.
Carrefour in Chinese Mainland
Entrance in China since 1995. Launch 118 branch store until now. Create great profit in Chinese Market.
Question 1.
Why do you think that Carrefour withdrew from the H.K. market yet have become very successful in the Chinese mainland?
Hong Kong’s situation of Carrefour
Marketing segmentation
Geographic:
1. Hong Kong is a small city in the world.
2. About 6 million population during 1997
3. In higher population density.
4. The average living size is 450 square feet
5. Less supply of the shops over 100 thousand square feet in the commercial centre. (place for development ???)
Hong Kong’s situation ofCarrefour
Marketing segmentationDemographic: 1. High household income in 1997 but
decreasing since 1998 by financial crisis.2. Higher ratio of rent in the commercial
market.
Behavioral :1. Quality and price perspective are equally
important.
Hong Kong’s situation of Carrefour
Marketing segmentation
Psychographic:
1. The purposes of shopping in Supermarket of H.K people buy can food, soft drink, groceries.
2. Shopping in wet market everyday for fresh food.
3. Buying household appliances in the other channel e.g. Broadway.
4. Not localize in H.K.
Hong Kong’s situation of Carrefour
CompetitorsParkn Shop WellcomeCRC Shop
They create the “price cut ” try to fright back Carrefour.The same destiny of competitor “Grand Mart”
Carrefour’s Localization (China Mainland)
Buying behavior is the objective Localize their distribution to fit Chinese
tastes China is not a totally centralized country Difference region have their own taste
and rules
Carrefour’s Localization
Example 1: Middle & Western China people are more
confident of frozen fish than of unfrozen dead fish.
Carrefour change the product offered Increase 30-40% sale volume
Carrefour’s Localization
Example 2: Tsingtao beer is the famous beer brand
around the world But in Beijing, Beijing beer is the no.1
brand
Carrefour’s Localization
Example 3: Panda is the old fashion and low-quality
brand in general views But in Nanjing, 35% of television are
made by Panda
Directly Distribution
The marketer reaches the intended final user by distributing the product directly to the customer.
There are no other parties involved in the distribution process that take ownership of the product.
Question 2:As a manufacturer, why would some Chinese companies engage directly distribution of products in China? What kinds of problems does it reflect in China’s distribution system?
Example : GREE ( 格力電器 )
Manufacturer
consumers
No parties involved between each others GREE plays 1. Manufacturer
2. Retailer
REASONS
1. Cost 10% to 15% cheaper than others
2. Profit ↑smooth ordering, packing and delivery without intermediaries
3. Customer loyalty Protection of trademark, patent and copyright
REASONS
4. Degree of control take over all aspect transactions
( example , logistics of shipment, collecting payment )
5. People Power ( Channel Power )
customers feel more secure in doing business with you
Problems
1. More Riskylack of information about Chinese culturerequire the largest involvement in the
export process 2. Conflict Boycott of supplies
in China
Problems
3. Cost ↑
Responsible for every level of organizations
Handle all the logistics of the transaction
Gome vs Gree
Conflicts on pricing strategy between the channel leaders– Manufacturer & Retailer
Gree withdrew from Gome to develop a direct distribution (point of sale)
In 2007, Gome & Gree both are the market leader in their industries in China
Finally they cooperate again!
Carrefour Situation
A traditional distribution channel
Manufacturer
Consumer Carrefour
Agent Wholesalers
Wholesales Market
Carrefour Situation
A traditional distribution channel
Manufacturer Carrefour Consumer
3 rd parties distributors
For example: Logistic Company
Question 3:
Base on the Carrefour’s distribution channel, what are the challenges and perhaps strategies for Carrefour?
Manufacturers Carrefour
The cost of distribution is high Less competiveness Time spend more through many
middlemen
農村合作社 Carrefour buy from the farmer directly The farmers are responsible for the packaging
and transportation as well Shanghai, Wuhan, Beijing and Guangzhou have
join the system
Manufacturer Carrefour
Manufacturers Carrefour
The cost of the supply chain have reduced 20 – 30%
The cost is much clear Time have saved Protect the quality of food For farmers, their income is
increased and guaranteed
Manufacturers Carrefour
Vendor Managed Inventory (VMI)
Carrefour provides information to suppliers
the suppliers take responsibility for maintaining inventory at the Carrefour's store.
Carrefour have cooperated with Nestle
Benefits of VMI
Planning and ordering cost will decrease
The overall service level is improved A true partnership is formed
between the Supplier and the Carrefour
Stabilize the timing of Purchase Orders
Share risk