CARREFOUR will sell products online in Africa through the Jumia platform



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(AOF) – Carrefour announces a partnership between two of its international partners, Majid Al Futtaim and CFAO Retail, and Jumia, an e-commerce specialist on the African continent. This partnership will market its product lines via Market Place Jumia in four African countries: Cameroon, Côte d'Ivoire, Senegal and Kenya.

"Thanks to this new partnership, Carrefour strengthens its presence on the African continent, which is undergoing a very rapid development of e-commerce," it said in a statement.

The distributor is present in Africa duty free in 7 countries with local partners in 227 stores.

AOF – LEARN MORE

Value Points

– First European food distributor and second in the world;

– € 78.8 billion of business concentrated in four major markets, France for 45% of sales, the rest of Europe – Belgium, Spain and Italy – by 27%, Latin America – Brazil mainly – by 20%, then Asia-China and Taiwan;

– Comprehensive reconquest strategy in the "Carrefour 2020" plan: a simplified multichannel organization with a voluntary exit plan in France (2,400 people) and partnerships Fnac-Darty, Showroomprivé or Tencent in China / productivity gains; competitiveness by means of investments of € 2 billion a year in commercial competitiveness and private label development, with a cost reduction of € 2 billion from 2020 and reduction of the ex-DIA fleet / creation of an omnichannel universe by opening 2,000 stores the acceleration of the Cash & Carry format with 20 new Atacadões per year in Brazil, the conversion of 16 hypermarkets to Maxi in Argentina and the expansion of Promocash in France until 2018, with investments in digital, up to € 2.8 billion by 2022 with a target of € 5 billion in e-commerce revenue by 2022 / improvement in food quality with the goal of 1 million additional consumers of fresh produce in France by 2022, € 5 billion in sales organic sector and 1/3 of sales via Carrefour brand products up to 2022;

– Strategic partnership with Google operational from 2019 for mobile sales and connected speakers, with a training contract in artificial intelligence;

– Comfortable financial situation, allowing the service of the dividend despite the net loss of the group.

Weaknesses in value

– Negative impact of currencies, notably the Brazilian real;

– To increase competition in electronic commerce, particularly in the Amazon, in the food sector;

– Four major difficulties: strong competitive pressure, particularly in France, higher distribution costs in the Group's main markets, higher depreciation as a result of the strong investment policy of the past and a more difficult situation in Argentina;

– Still difficult situation in Argentina, deficit for the 2nd consecutive year;

– 2017 results in loss;

– Image of governance stained by the amount of compensation payments, finally declined, granted to the former leader of the group;

– Tensions between shareholders and very rapid rotation of the presidents.

How to Follow the Value

– Sensitivity to consumer purchasing power, geopolitical risks in Europe, regulatory approvals for opening stores;

– Evolution of market shares in France, Brazil and Spain, the top 3 countries in the group with 8/10 of current operating revenue;

– Continued recovery in Brazil, China and Taiwan;

– Speculation about an acquisition of the group by Amazon;

– Advanced from 2018 of the Carrefour 2020 plan: cost reduction, sale of 273 ex-Day stores, acceleration of "cash & crary" sales formats in Brazil and Argentina, launch of the Carrefour.fr platform and creation of 170 "Drives" in France;

– Capital division with two large shareholders – the Moulin family, also owner of Galeries Lafayette (11.51% of the shares), and Groupe Arnault (8.57%).

Generalist distribution

Faced with the strategic turning point of the incursion of e-commerce into the food industry, retailers must reinvent themselves. Some are forming partnerships such as Alibaba and Auchan in China. Defensive strategies are also sought and several plans are presented: "Vision 2025" in Auchan, logistical transformations in the Intermarché, "Carrefour 2022". These restructurings sometimes involve job losses or savings. Thus, 2 billion euros of savings until 2022 are anticipated in Carrefour. The question of the future of the supermarket is more than ever crucial. Carrefour and Casino have already planned to reduce their surfaces while the "Drive" formula continues its development. According to Fevad, there are already more than 4,000 in the territory.

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