Table of Contents

Executive Summary....................................................................................................................................... 3
Introduction .................................................................................................................................................. 3
Organizational Structure ............................................................................................................................... 4
CARREFOUR MIDDLE EAST OPERATIONS ...................................................................................................... 4
SUPPLY CHAIN STRUCTURE AND STRATEGY ............................................................................................. 4
Carrefour My Club................................................................................................................................. 5
Carrefour Supermarkets and Hypermarkets......................................................................................... 6
Product Categories:............................................................................................................................... 8
Carrefour Web Store ............................................................................................................................. 8
Delivery Options.................................................................................................................................... 8
AXA Insurance ....................................................................................................................................... 9
Delivery to Work or Home .................................................................................................................... 9
Delivery Restrictions ............................................................................................................................. 9
Change of Delivery Date ....................................................................................................................... 9
Secure Online Payments ....................................................................................................................... 9
Value Added Services ............................................................................................................................ 9
Responsiveness VS Efficiency .............................................................................................................. 11
Codification ......................................................................................................................................... 13
Electronic Data Interchange................................................................................................................ 16
Message Implementation Guide (MIGS)............................................................................................. 16
The Trade Item Data Model ................................................................................................................ 17
Carrefour GDS Network ...................................................................................................................... 17
Operational Strategy ............................................................................................................................... 18
Marketing Strategy ............................................................................................................................. 18
Competitive Strategy .......................................................................................................................... 19
Procurement Strategy ......................................................................................................................... 20
Logistics and Warehouse Strategy ...................................................................................................... 21
Issues ........................................................................................................................................................... 21
Keeping Possible Minimum Prices .......................................................................................................... 22
Monitoring of Performance on Daily Basis ............................................................................................. 22
 Supplier Selection ................................................................................................................................... 22
Destabilization of the Region .................................................................................................................. 23
Lack of Local Labour ................................................................................................................................ 23
Roadmap Ahead .......................................................................................................................................... 23
New Customer Experience...................................................................................................................... 23
360° Approach .................................................................................................................................... 23
Customer Driven Renovations ............................................................................................................ 23
Renovation in Every Section ............................................................................................................... 24
Encouraging Local Talent ........................................................................................................................ 24
Expansion ................................................................................................................................................ 24
Recommendations ...................................................................................................................................... 24
Enhancing E-Shopping Trends................................................................................................................. 24
CSR .......................................................................................................................................................... 25
Conclusion ................................................................................................................................................... 25
Reference List.............................................................................................................................................. 26
Executive Summary
Carrefour is one of the leading giants in the retail industry of the world. This report is an account
for a successful journey of Carrefour form one store to numerous outlets in the world. Mainly
focusing on the Carrefour in Middle East, this report accounts for detailed analysis of the
Carrefour Operations in the region and their supply chain structure and strategy. Supply chain
and structure deals with their product selection, site selection and the use of technologies and
offers to attract their customers by striking a right balance between efficiency and
responsiveness. Marketing strategy by taking an account of 4 P’s, competitive strategy, logistics
warehousing and procurement strategy also give a detailed analysis of the operational side of
the Carrefour structure. In order to implement these strategies, they issues they are facing
globally and locally are also brought under discussion following by the roadmap of their future
plans in the coming five years with a brief view of improvements that are needed to be address.

Introduction
Carrefour Supermarket Company was founded in 1959 by Fournier, Badin and Defforey families.
In the year 1960 Carrefour opened its very first super market in Annecy, Haute-Savoie. In 1963,
they came up with a new store concept called Hypermarket and opened their first hypermarket
store in Sainte-Genevieve-des-bois. Later in 1973, Carrefour introduced its hypermarket to Spain
and in 1975 to Brazil. In 1979, Carrefour developed a concept of hard discount and started ‘Ed’
chain in France. Meanwhile they continued to open their hypermarkets in countries such as
Argentina in 1982 and Taiwan in 1989. In 1992, they created a filière quality system to make
traceability easy and to keep the record of the origin of the product. From 1993 to 1997 Carrefour
took its hypermarket concept to many more countries which are Italy, Turkey, Mexico, Malaysia,
China, Thailand, Korea, Hong Kong, Singapore and Poland. In 2000 by the name of Ooshop, they
introduced an online supermarket. A European property company was established in 2004 by the
name of Carrefour property. In 2005, they started acquiring properties around the globe and still
are continuing to do so. (Carrefour History)

Carrefour came up with a number of products and services ever since they started growing. In
1976, they introduced “produits libres” the unbranded products that were cheaper and could
compete with any other branded product. A payment card by the name of “The pass card” was
introduced in 1981. Insurance services were started to provide by Carrefour in 1984. From 1985
Carrefour started introducing products with its own brand name and in 1991 they launched travel
services. (Carrefour, company website)

In the Middle East and North Africa (MENA) market, Carrefour, which opened in Deira City Centre,
Dubai was introduced in 1995 by Majid Al-Futtaim who are the leading retail, shopping mall and
leisure pioneer in the MENA region. (Linkdin) It comprises of two kinds of store concepts;
hypermarket and supermarket. In the Middle East they have enjoyed a steady growth and in the
future they have plans to expand even more. (Carrefour UAE, company website)

Currently Carrefour group is the second largest retailer in the world after Wal-Mart and the
leading retailer in Europe. Their head-quarter is located in Boulogne-Billancourt, France. They
have more than 10,100 stores in around 34 countries having nearly 365,000 employees.
Carrefour offers a huge range of products at reasonable amount of prices to nearly 10 million
customers around the world every day. In 2013, Carrefour generated revenues of €100.2 billion.

They started their operations in Brazil in 1975 and in China in 1995 and now they operate in three
major markets namely Asia, Europe and Latin America. Carrefour’s network includes
Hypermarkets, Supermarkets, online stores, convenience stores and discount stores. 55% of
Carrefour’s sales are generated outside of France.

Carrefour, wherever it operates exhibits its commitment to local economic growth. They always
try to hire people who live locally in the country where they are operating instead of hiring other
nationals. They also train their managers and staff on site. In addition to that Carrefour usually
gives priority to local supply chains and that is the reason that 75% of all the food products that
we see there comes from local suppliers in the countries in which they operate.

Organizational Structure
The structure of Carrefour is hierarchical with a more functional managerial organizational
structure. The presidents, of management board and supervisory board forms top of the
hierarchy in Carrefour’s organization. Under them are Directors of organization and systems and
Merchandize and Marketing. And after this point there is a director for every specific zone in
which Carrefour is located.

This kind of structure proved to be very efficient for Carrefour. It authorizes to important
functions the abilities to take care of pivotal business dealings of each division. It helps in
comparing the performance of each division with the performance of other divisions. In addition
to this, it also helps in coordination among the functions of each division, reducing the chances
of confusion and of overlapping responsibilities. (Scribd, Carrefour Structure)

CARREFOUR MIDDLE EAST OPERATIONS

SUPPLY CHAIN STRUCTURE AND STRATEGY
For almost two decades now, Majid Al Futtaim Retail – Carrefour, which was established in 1995
with the opening of Deira City Centre has become the most dynamic, fast-paced and popular
hypermarket and supermarket chain in the region. Carrefour became popular because of its
effective concept of a one-stop-shop for all of the customers’ needs. Two distinct operating
functions constitute Carrefour; hypermarket and supermarket. Majid Al Futtaim Retail -
Carrefour plans to open a number of hypermarkets and supermarkets stores in a number of new
locations and territories in the UAE.

Carrefour My Club

Figure 2: Carrefour My Club (Carrefour UAE 2013)

In the image above, (Carrefour UAE 2013), customers can obtain free loyalty cards that are
available in all Carrefour stores (in the UAE) at the customer service desks or at the cash register,
and also on the web store. Shopping customers are able to get free points without extra cost,
and provides them with special loyalty card offers.
Carrefour Supermarkets and Hypermarkets

Carrefour Market aims to give customers a unique shopping experience. The customers are only
offered the freshest product in the market from baked breads, fisheries and butcheries. Carrefour
does not only offer their customers a massive range of products to choose from, but they’re
products are all in affordable prices. Carrefour Markets are industry leaders that work hand in
hand with local farmers and fishermen just so they could provide the consumers only the freshest
products available in the market, they also have one of the largest square footage in the gulf.
Highly trained in-store bakers, butchers and fish mongers are on hand to provide freshly baked
breads, the finest cuts of meat and the biggest selection of freshly caught fish available. Our
employees having vast knowledge of their products means, that you can get the best advice on
which product suits your needs and even tips on how best to work the ingredients. The
hypermarkets also offer gardening equipment, outdoor furniture and sporting goods, everything
the outdoor enthusiast could want. With all the latest toys, books, electronics and movies, you
can ensure that your whole family will be entertained. Carrefour offers the highest standard of
fresh produce and the biggest selections of household items, coupled with excellent customer
service. In the image below (Carrefour UAE 2013), Carrefour market locations across UAE and the
timings are shown in details.
Figure 3: Carrefour Market Locations (Carrefour UAE 2013)
Product Categories:

Figure 4: Categories (Carrefour UAE 2013)

Carrefour Web Store

An online shopping experience with Carrefour UAE offers a wide range of hypermarket products
which includes televisions, gaming and electronics. It has an easy-to-use, safe and secure online
payment system. Exclusive offers and special discounts can also be enjoyed and experienced by
Carrefour’s online web store customers.

Delivery Options
Free delivery service for large items and smaller items are delivered by UPS or Aramex across all
parts of the UAE. Customers can track orders online for all small items via the UPS or Aramex
tracking system. Please refer to the table below for shipping cost indication (Carrefour UAE 2013).

TOTAL PURCHASE UPS/ARAMEX DELIVERY

FROM TO 0-5 KG 5.1-10 KG 10.1-15 15.1-20 20.1-25 25.1-30 KG
KG KG KG
0 AED 250 AED 15 AED 15 AED 18 AED 18 AED 25 AED 25 AED
251 AED 500 AED 11 AED 11 AED 14 AED 14 AED 19 AED 19 AED
501 AED 750 AED 0 AED 0 AED 7 AED 7 AED 12 AED 12 AED
751 AED 1000 AED 0 AED 0 AED 0 AED 0 AED 11 AED 11 AED
1001 AED And Above 0 AED 0 AED 0 AED 0 AED 0 AED 0 AED

Figure 4: Web Store Delivery Options (Carrefour UAE 2013)

AXA Insurance
All deliveries are insured by AXA insurance from Carrefour’s warehouse or supplier’s warehouse
up to customer’s home.

Delivery to Work or Home

Customers can keep two delivery addresses within the UAE in their profile – work and home
addresses. When an order is placed, customer can specify the preferred delivery address for that.
If the customer would like to send a gift to someone, he has the alternative address of the
receiver as an option.

Delivery Restrictions
There are areas in Western Region which are not covered in Carrefour’s delivery service.

Change of Delivery Date

Prior to dispatch of the ordered materials, customer may request to change the delivery date
by email delivery.webstore@mafcarrefour.com.

Secure Online Payments

Customer’s online purchases can be paid by using any of the following major credit cards:

Via Emirates NBD operating on a professional third party, all payments are being transacted. In
case of refund, through the Mastercard payment gateway, it will be done on the same credit card.
Carrefour’s processing time is 2 working days and then it will be credited back to customer’s card.
The entire procedure may last for approximately 10 days. Online security is being taken cared by
Carrefour extremely seriously. The customer’s data is encrypted to the highest standard and held
on a secure computer to be protected from hackers and criminals. All data is being hosted by the
Mastercard payment gateway. Credit card details are never stored within the systems or
computers of Carrefour. When a customer places an order with
www.carrefouruae.com/webstore, it's absolutely secure.

Value Added Services

C4 Extended Warranty

Figure 5: C4 Extended Warranty (Carrefour UAE 2013)

All electronic goods sold in every Carrefour store has an available warranty and are available at
the time of purchase of the consumer’s goods. The cost of repair, including the parts and call-out
charges for the electronic item by one of the Carrefour’s reputable repair service center is
covered in the 3 year warranty. Carrefour’s skilled service representative can repair your large
household goods onsite in the comfort of your own home. Enjoy peace of mind and minimal
additional charge with Carrefour Extended Warranty.

Najm Card

Figure 6: C4 Najm Card (Carrefour UAE 2013)

The Najm credit card, is for shoppers that offers the best cash back and benefits for leisure,
entertainment, shopping and more. Members at Carrefour Hypermarket are able to enjoy 4%
Cash back on all the products, zero interest easy payment plans are offered to the consumers for
all their electronics purchases above AED 1000 at Carrefour web-store.

Carrefour Gift Cards

Figure 7: Carrefour Gift Cards (Carrefour UAE 2013)

Is present buying becoming a hassle? Then top up a Carrefour Gift Card with an amount of AED
100 at any checkout and the recipient will be free to choose their own gift. This gift card is
absolutely perfect for any occasion for family and friends.
Carrefour Easy Payment Plan

Figure 8: Carrefour Easy Payment Plan (Carrefour UAE 2013)

Buy now and pay within 3.6 and 12 month installment with 0% easy payment plan.

Responsiveness VS Efficiency

Figure 9: Responsiveness vs. Efficiency (Supply Chain Management 2005)

 Figure 10: Responsive Supply Chain (Center for Systems Innovation 2010)

Good Supply Chain Strategy is Based on Timely and Accurate Data

According to Michael Hugos (2010) accurate and timely information is the central supply chain
driver, good strategy starts with improving the accuracy and flow of data between companies
working in a supply chain. All other strategic decisions and tactical actions depend on this.
Effective strategies support creation of a “virtuous cycle” of continuous improvement; and good
information is what makes that possible.
Codification

Carrefour implements the GS1 coding of products, services and locations which enables
efficient management of supply chains.

Figure 12: Carrefour Codification (Carrefour.net 2008)

The efficient movement of goods and the optimization of the logistics chain can be gauged based
on the precision with which products, services and locations are identified. Carrefour effectively
maintains an optimized Logistics Chain through the GS1 system. This is a set of rules designed to
enable efficient management of supply chains by assigning unique identification codes to
products, logistic units, locations and services. Coding is the fundamental aspect of the GS1
system: stable coding means a coherent system. For optimum data quality, coding is used to
synchronize physical flow with information flow.

Products and Services of Codification

For products and services, GTIN is the unique identifier assigned.

Figure 13: Carrefour GTIN (Carrefour.net 2008)

The GTIN (Global Trade Item Number) uniquely identifies items.
This is used in consumer units or standard
groupings of consumer units in a standard format like cases, packages, boxes and pallets. A GTIN
is assigned to any trade item which can be ordered or invoiced, or priced at any point of
Carrefour’s supply chain.

Locations

The unique identification key for locations is the GLN.

Figure 14: Carrefour GLN (Carrefour.net 2008)

The GLN can be utilized in identifying the physical locations and legal entities. Carrefour is capable
of retrieving pre-defined information to improve the efficiency of communication with the
supply-chain. Global Location Numbers are a prerequisite for EDI messages. This is necessary to
access information from the Global Data Synchronization Network. The GLN is composed of a 13-
digit code.

Logistics Units
These barcodes are used for the boxes which do not pass through retail checkouts.

Figure 15: Carrefour Logistics Units (Carrefour.net 2008)

ITF-14 can be printed directly on cases/boxes.

Dispatch Units
For consignments of products, SSCC or the Serial Shipping Container Code is the unique identifier.

Figure 16: Carrefour Dispatch Units (Carrefour.net 2008)

The SSCC is the GS1 Identification Key for the products for transport and/or storage which needs
to be managed through the supply chain. Carrefour is capable of following the physical
movements of individual items by mapping the physical flow of goods to the associated
information flow. The SSCC is the key in different supply chain like cross docking, batch routing,
automatic reception and traceability.

At every point on the supply chain, barcodes allow the automatic identification of all products.

Figure 17: Carrefour GSI System Barcode Family (Carrefour.net 2008)

GS1 DataBar

Figure 18: Carrefour DataBar GSI (Carrefour.net 2008)

The main advantage of the DataBar is its size because it is relatively smaller having no margin.
This means it can be used on products currently unable to receive a barcode because of very
small size.

Electronic Data Interchange

Electronic Data Interchange popularly known as EDI allows companies to exchange commercial,
logistical and financial information. With minimum intervention of human, Data Exchange can
happen from computer to computer.

Figure 19: Carrefour EDI (Carrefour.net 2008)

Message Implementation Guide (MIGS)

Figure 20: Carrefour MIGS (Carrefour.net 2008)

The MIGs (Message Implementation Guide) are guides allowing Carrefour and the suppliers to
share information on the standards that will be used during EDI.
The Trade Item Data Model
The Trade Item data model is based on 3 key principles: a single product sheet, description of
the logistical hierarchy, and the use of GTIN / GLN.

Figure 21: Carrefour Trade Item Data Model (Carrefour.net 2008)

Trade Item data model has three principles:

1. A single product sheet shared by all users and serves as the foundation for all physical and
data flows over the global supply chain. Manufacturers are capable to describe all the
information necessary for the product and its logistics using this.

2. The logistical hierarchy serves as the link to various product levels from consumer unit to
pallet.

3. GTIN identifies each level of the product sheet.

Carrefour GDS Network

The GDSN data pool network serves as the portal to suppliers allowing them to publish their
information once and allow all users to retrieve it, while retailers can subscribe once and receive
information from all suppliers.
 Figure 22: GDS Network (Carrefour.net 2008)

Based on Carrefour.net (2008), GDSN offers a single point of entry for the synchronization of
product sheets. For manufacturers and suppliers, that means "publish once, distribute to all",
while for retailers it means "subscribe once, receive from all". By making product information
exchanges faster and more reliable, GDSN® ultimately contributes to greater consumer
satisfaction.

Operational Strategy

Marketing Strategy
Product
In 1963, Carrefour was the first to introduce the hypermarket concept and opened its first store
in France. The hypermarket provided everything under one roof such as household items,
toiletries groceries, clothing, and consumer electronics. In the UAE, along with selling its usual
products, Carrefour will need to remain mindful of the culture of the UAE and sell only food
products that are halal. That means they need to make sure that they have local suppliers who
can provide them with the high quality products needed to meet the customer’s demand.
Additionally considering the UAE’s diverse expatriate workforce, they will need to stock items
that cater to the tastes and needs of this population and also take into account their buying
power (SIS international Research 2009).

Price
Price is an important factor in the success of the hypermarket concept. Carrefour is aware of the
competitive prices and then prices are set lower or at the same rate than the competitive prices.

To keep ahead of competitors and continue to provide low prices, Carrefour started purchasing
products locally. This helped Carrefour position itself as a leader in fresh products enabling them
to meet the needs of local consumers (Bell, Lal & Salmon 2004 p.290).

Place
Globally, Carrefour’s stores are located outside the town or city limits in order to accommodate
for the large layouts due to the hypermarket concept. The size of the stores on average typically
is 108,000 square feet. Usually the interiors of a Carrefour store resemble a warehouse facility
and hence are able to achieve “total investment per square meter of selling space” (Bell, Lal &
Salmon 2004 p.289). In the UAE, Carrefour is mostly located in all the major shopping malls which
are a departure from the standard warehouse facility. The malls are easily accessible by the Dubai
metro and it becomes easier for the consumers to opt for shopping at Carrefour stores (SIS
international Research 2009).

Promotion
Carrefour offers promotions throughout the year which include Crazy sales on household
essentials, food products and electronic items. Carrefour has special in-store lotteries where a
cash register counter number is picked at random and the customer billing out from that counter
receives his entire shopping free of charge. This promotion entices customers to shop more
frequently. Additionally, customers are also offered the Carrefour MyCLUB card which they can
get at the cash registers. This card allows customers to accumulate points on every shopping trip
and redeem them. They are also offered special loyalty card offers (MyCLUB 2013).

Competitive Strategy
As of now, none of Carrefour’s major competitors like Wal – Mart, Tesco, etc are present in the
UAE. Though Gëant is present in the UAE, it has not been able to make a notable headway into
the UAE market.

By keeping a continuous eye on prices, Carrefour has been able maintain its position as second
largest global retailer with Wal-Mart being ranked as number one. Carrefour faces competition
from retailers such as LuLu Group, Spinneys, and Choithrams etc. Price of fresh foods is a major
aspect of the competition in the UAE and therefore the margins gained will be less though items
such as household items, clothing etc can be sold at higher margins (SIS international Research
2009).

Even though Carrefour offers discounts and other attractive concepts to its customers as
mentioned earlier, it is important to note that smaller supermarkets and other local grocery
stores attract many of the customers due to the proximity and accessibility of the stores in the
residential areas.

Another very important strategy that helped Carrefour Group gain success was its decentralized
organizational structure which it follows to this day. The Group’s head office in Paris manages
the long term strategy, financial and technical matters. With decentralization, store managers
became wholly responsible for the profit or loss a store could make as well as they would provide
forecasts to the headquarters. Also the store manager decides the store layout, the environment
of the store, and the space to be allocated to various departments (Bell, Lal & Salmon 2004
p.289).

Procurement Strategy
Carrefour Group is able to work along with all its major and minor suppliers at the global, regional
and local levels. It has an “annual negotiation process” (Export Solutions n.d.) and this defines
the conditions for procuring all products for a whole year. Products are bought through online
auctions and this has become a standard for the Carrefour Group. The negotiation process began
in 2000 and the suppliers are pre-selected according to the rules laid down by the Group. The
negotiation process provides the benefit of transparency (Export Solutions n.d.). The
headquarters in Paris negotiates the expansion of suppliers into new countries by setting up
global agreements without compromising the pricing at the national level (Bell, Lal & Salmon
2004 p.28).

The Carrefour Group also uses a ‘direct procurement strategy’ and obtains a majority of its
product from the local farmers and breeders in which it is based. This strategy benefits the
customers by providing an array of choices and better quality due to the close relationship with
suppliers (Carrefour 2013). This enables Carrefour to have lower prices when compared to
competitors (Kamath 2010).

The Group provides its support to its suppliers so that they have better policies with regards to
social responsibility. To ensure high quality products are provided to customer, the Group, in
2006, developed an online self-diagnostic tool that helps the suppliers bring their products on
par as per the requirement of international organizations such as the ISO. Furthermore,
Carrefour has multi- year partnerships with its suppliers to ensure long term growth.
Logistics and Warehouse Strategy
The Carrefour Group asserts the need for On- Shelf Availability (OSA). The non -availability of the
right product leads to a lost sale for both the Group and its suppliers. To ensure the availability
of a product, an electronic system tracks the inventory available in store and replenishes the
stock by automatically placing orders to the suppliers (Carrefour.net 2008).

Increasing the product rotation is another logistics strategy that can help to ensure OSA in the
outlets. To achieve this, cross docking is implemented. Cross docking is a technique to reduce
material handling and also eliminate the need to store goods in a warehouse. In this method,
products received from different suppliers are combined into a ‘mixed product pallets’ as per the
requirements of the particular store. (Murray n.d.)

Carrefour would supply its outlets from the supplier’s warehouses leading to increased costs. In
order to reduce costs, deliveries to outlets are made after cross-docking is done (Waters 2003,
p. 91).

The suppliers send the goods to a distribution/consolidation centre and the products are
consolidated as per the orders of the particular outlet. This leads to reduced expenses for the
suppliers (Abbas 2012).

Other benefits can also be seen for the Group; such as the need for minimum order quantity is
reduced due to consolidation of the orders of the outlets and there is also a safety stock
maintained (Carrefour.net 2008).

Carrefour’s success in maintaining OSA can be attributed to a well -organized supply chain
process. Therefore, information sharing becomes a very important aspect in this process. There
should be a ready availability of reliable order information through data exchange. The use of EDI
(electronic data interchange) was implemented and sharing point of sale is required as it is
associated with activities such as cross docking, store replenishment, promotion etc. Sharing
point of sale would lead to identifying when stocks would run out as well as better delivery and
production of items required for promotional purposes and the time required in getting the
product to the market. Information sharing would also lead to considerable reduction in the
order cycle and payments. Also notable is the introduction of Shelf Ready Packaging (SRP) which
helps to increase sales and the costs are also lowered of the products (Carrefour.net 2008).

Carrefour Group is taking a lead by introducing ‘responsible procurement’ in order to reduce the
carbon footprint of their operations. To do this, Carrefour plans to implement different forms of
transportation such as using the rail network to transport product and also switch to using hybrid
lorries to procure its products (Carrefour 2013).

Issues
Keeping Possible Minimum Prices
According to Majid al-Futtaim, Carrefour attracting the customers in the MENA region with the
logo of “Low prices & so much more”. According to this logo it’s a challenge for them to provide
their customer with minimum possible price but with maximum possible value. So, they have to
enhance the value of their supply chain to keep the prices minimum and to gain the loyalty and
trust of their clients and customers.

“Low Prices & So much More” is not that easy to sustain continuously. It requires continuously
developing, unbiased & clear procedures and practices for their suppliers to keep their
confidence and faith in administration and policies of Carrefour. It demands continuous
monitoring of the needs and demands of the people and to provide them the quality & variety
under one roof with the key aspect of affordability. Consequently, they have to continuously
enhance their own products not only in quality but also in affordability and reliability, not only to
keep an edge on competitors but at least to provide their customer same level of the product to
their customers. Striking a right balance between responsiveness and efficiency is always a tricky
task for any hypermarket especially in markets like Middle East.

Monitoring of Performance on Daily Basis

Majid al-Futtaim and Carrefour jointly running approximately 50 hypermarkets and 44
supermarkets in MENA and Central Asia. It is a tough job to identify the potential competitors in
different areas and keep themselves aware of the strategies related to pricing, varieties and
services of their competitors on the day to day basis. It is a daunting task to sustain the
profitability on daily basis. It puts pressure on the supply chain to provide efficiency and
responsiveness at the same time. The have to maintain the flow of the products from upstream
to downstream and failure anywhere in the chain would result in losing the confidence of their
clients. So, they always need to adapt state of the art procedures to promote innovation within
all their departments to provide efficient services to their clients and customers and the failure
would result in gradual decrease in profitability which is the prime purpose of any supply chain
model.

Supplier Selection
Carrefour deals in numerous products from perishable to non-perishable, food items to home
appliances, hardware to software and many more. To become an efficient supplier they have to
rely on the local suppliers. One of the major issues for any hypermarket in GCC is to provide best
possible quality to the customers. GCC in food item is not a region which is dependent on imports
of the food items. So, it is necessary for players like Carrefour to select efficient suppliers to
provide them quality imported products specially food items which require efforts for their
handling. So they have to keep an eye on their suppliers whether they are complying with the
given standards of governments and as well as their own standards or not.

Destabilization of the Region

Carrefour is operating in countries like Egypt, Syria, Jordan, Lebanon and Iraq. After the Arab
Spring the region is destablized due to political reasons. In these conditions its very difficlut to
maintain the supply chain and also to provide efficient services to their customers. In countries
like KSA and UAE if you want to import anything, definitely neighbours are the best options
because of the shortest routes the costs are usualy lower but with growing uncertainity in the
region, it puts extra pressure on the supply chain structure and eventually effects the efficiency
and responsiveness of the supply chain structures. As UAE is not an island, so political unrest in
Iraq and Iran will defenitely impact the bussiness in UAE as well.

Lack of Local Labour

In few countries in Middle East, companies have to rely on the labour from other countries. This
fact, like in UAE, they do not offer local labour to run their affairs. So players like Carrefour have
to bear extra pressure on their supply chain because of strict visa restrictions as well as labour
laws for the foreigners.

Roadmap Ahead
New Customer Experience
According to Carrefour, they as a group working hard to enhance the customer experience. Right
form the parking of your car to the point of sales experience. It is in their vision of 2013 to go
towards modernization. This modernization will help in making sites more attractive, enhanced
comfort and developments consistent to their company throughout the world. They want to
improve each store individually according to a particular site but keeping the original identity of
Carrefour intact. Only in 2013, 49 hypermarkets had been renovated and restructured. All across
the world the clear roadmap has been chalked out and action is in progress.

In order to improve customer experience they are following three different strategies.

360° Approach
It deals with the technique that think like a customer. Drive a car to Carrefour, park it and note
down the experience of shopping till going back from Carrefour. It will give idea to feel the
customer experience at Carrefour.

Customer Driven Renovations

It is a way to make improvements by taking the customer surveys. Customer surveys help the
management to make necessary possible changes. For example in France in one of a store while
doing the renovation (St Quentin en-yvelines) they took the survey of 1000 customers. Now in all
parts of the world they are making several round table meetings with their customers to get more
positive results.

Renovation in Every Section

Renovation is different in nature and style in every different store. Same is the case with each
section. Each section has its own criteria of improvement and order of its products, They are also
working on the concept of improvement of enhancing the experience of each particular section.

Encouraging Local Talent

They have a policy to give chance to local either as an employee or suppliers. This would give the
locals to involve with the Carrefour and helps them to make their position stronger in any
particular area. This would not only help to increase the skills of local people but also helps them
to gain a positive image in that region.

Expansion
They have a plan to extend their presence in different regions. Like Majid al-Futtaim as a group
has announced AED 3 Billion before Expo 2020. In this investment they are apart from other
activities they are planning to open 2 new hypermarkets and 4 supermarkets in Dubai. Same in
Qatar they are planning to go big before FIFA world-cup in Qatar. (Issac, 2013)

Recommendations
Carrefour is present in the countries indicated in the map in the Middle East region. Although
political unrest is affecting the market but still Carrefour has manged to run its supply chain
effectively and efficiently and they are earning good revenues within this region.

Enhancing E-Shopping Trends

Carrefour in Middle East needs to focus on enhancing the experience of E-shopping. Although
they have their online shop but it does not contain the whole range of the products. Groceries
and other house hold items are still not available on the web store of the Carrefour. It is a window
of opportunity for them to take the lead in the Arab market by adopting some model like TESCO
in South Korea where people can use their cell phones to purchase items on the move in places
like subways.
CSR
Internationally, world is becoming more and more aware of the impacts of the business activities
socially and environmentally. In order to deal this issue, companies are continuously publishing
their efforts to deal with those impacts. (Guziana & Dobers 2013, p.193-194)

According to Carrefour UAE, they have already initiated its first campaign in UAE in 2007 to
promote reusable bags and with their efforts they have sold around 80000 bags till now.
Decreasing the use of plastic bags is one of the concern of Carrefour to help improving
environment but still apart from these efforts there should lot more to be done as not much
information is available on their UAE website which shows they should give much more detailed
policy on CSR.

Conclusion
Competing in a competitive world requires continuous up-gradation and innovations. Carrefour
in recent years hasn’t performed as per their expectations. Although they are continuously trying
to keep themselves prepared for the any challenging task but still they are unable to capitalize
the market as a retailing giant. They need to cut their costs more and at the same time responsive
to needs and demands of the people. Systems like RFID on one hand giving them luxury of
maintaining supply chains but on the other hand costing them a lot as well. Multichannel
Marketing is another technique that they should focus upon and in order to make it effective
supply chain support is very crucial.
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