What changed for Carrefour in 2015 ?
2015 was a good year for the Group, which demonstrated consistency in its performance: our sales and income increased for the fourth consecutive year. This affirms our choices and our model, and shows the solid momentum the Group has enjoyed since 2012. Of course, these results were achieved thanks to our 380,000 employees: the men and women of Carrefour showed, for yet another year, their remarkable commitment to serving our customers and Society. This financial year also confirmed the Group’s strong focus on food. Our expertise in fresh produce with a high quality of service, is a key asset. What really changed for us in 2015 was the scale of the transformation that the Group undertook based on two ideas that brought us closer to our customers’ expectations: a large number of convenience stores and a move toward an omni‑channel business.
An important milestone was achieved in 2015: Carrefour became fully multi‑format in every country in which it operates, with the launch in China of the first Easy convenience stores. This change comes with a direct result: the centre of gravity of our network of stores has shifted increasingly toward c onvenience formats. For example, in France, the inclusion of the Dia store network contributes dramatically to this change. Without a doubt it is one of the most important transformation efforts that the European market has seen in recent years in terms of the number of points of sale. We are carrying out this ambitious task at a steady clip, with more than 40 store conversions each month. It’s a testament to the intensity of effort and the mobilisation of our deployment teams.
The second major transformation for Carrefour in 2015 was the gradual migration of the entire Group toward an omni‑channel model, which, without being intrusive, consists of offering our customers quick and effective solutions at any point in their shopping experience in order to meet all their needs.
This is why we are making investments that will provide us with more responsive IT infrastructures. By improving our back office through the simplification and development of IT systems architecture, we have gained in efficiency and preparedness when it comes to processing data on a large scale. This development is focused primarily on our systems, but it will also involve the progressive equipping of our stores and of our employees in order to improve interaction with customers.
The overhaul of logistics in France to fit the multi‑format and omni‑channel model, and the creation of an integrated logistics system in China that serves small stores and e‑commerce in particular, are all part of the same comprehensive approach.
Is the customer a factor in the changes to your business ?
Certainly. Consumers are changing their lifestyles due to increasing urbanisation and extended life expectancy. What has been the most significant is the surge in new dietary trends, including vegetarian, gluten‑free and home‑made diets. Customers are demanding fresh, organic, locally‑produced foods and are looking for more convenience, conviviality and quick service.
This is the strength of a multi‑format Group: to be able to continually adapt to all types of customer. Let’s take organic products, for example: Carrefour was a pioneer by selling loaves of organic bread in its bakery departments in 1992. That gave us a head start, and today we are the leading seller of organic products in France. Similarly, we have been working on specific own‑brand product lines, launching Carrefour Veggie, the first range devoted to vegetarians. We will continue with this differentiation effort through our offer and our network.
How do you take these new types of usage into account in your commercial model ?
We have become more agile. The decentralisation and transformation of the company’s organisation has freed up initiatives. That puts us in a position to work with new talent more. We are supporting the development of start‑ups that can design new products and services with us, by trying out new partnerships.
This is how we continually enhance our offer and refine our concepts so that we can take into account consumer expectations, catchment areas, and the overall economic situation: Easy in China, our Bio, Contact, and Bon app! banners and the development of City in train stations and airports in France, Market Gourmet and H24 openings in Italy, the development of Atacadão throughout Brazil, and the new spaces in our hypermarkets that have very recently been set up in Belgium, Spain, France and Italy.
The acquisition of Rue du Commerce was made in the same spirit. It’s a laboratory that allows us to consolidate our expertise and exposes us to other practices, such as those of a marketplace, which present major potential for expanding our product ranges to complement our offer. Carrefour is working more and more in a lab mindset.
Where exactly are you when it comes to digital technology and e‑commerce ?
In our mature economy, digital technology marks a return to a focus on service and puts the customer back at the centre of our business. That suits us well, because it’s in our DNA. In all the countries in which we operate, Carrefour’s digital transformation is already underway.
"In 2015, Carrefour became fully multi‑format in every country in which it operates."
Everywhere, we’re developing food and non‑food e‑commerce offers. Everywhere, we are working on the offer and product families and ranges in order to identify possible opportunities for online retail. Everywhere, we have implemented a solid approach to digital marketing and social‑network communications.
These changes run parallel to a new mindset: the corporate culture is growing with more initiatives, more risk‑taking, more testing. Digital technology contributes to freeing up available information and removing barriers from our practices. This is indispensable if we want to attract the best talent of the future, because just as customers are changing, our employees are changing too.
How do you see your various markets evolving ?
Our balanced country portfolio is a major asset. Our historical markets in Europe and Latin America are doing well. All the European countries are growing, which confirms that Europe has again become a main base for Carrefour. In Latin America, we are strengthening our position as a leader in food retail both in Brazil – our second‑biggest market – and in Argentina. In Asia, we saw renewed growth in Taiwan, and in China we are adapting to the changes in the local economy, like many other players. We are adjusting our model for regional organisation, logistics, and local sourcing. In this country just as in others, we are thinking long‑term. We intend to play a consolidating role in these markets. We also moved forward with tactical acquisitions, which helped to reinforce organic expansion, consolidate our multi‑ format position and enrich our know‑how. This was the case with the acquisitions of Rue du Commerce in France and the Billa network of supermarkets in Romania. And with our partner CFAO, we took our first steps into Africa, in Ivory Coast, to prepare for the future there.
Today, how do you reconcile corporate responsibility with business performance ?
Our stores, suppliers and NGOs are established and involved in their regions. All of them contribute to their social and economic development.
Over time, we have formed partnerships and made commitments to combat all types of waste, improve energy efficiency, encourage the preservation of biodiversity, and contribute to solidarity. The Carrefour Foundation, which is dedicated to solidarity through food, offers its support everywhere it believes it’s necessary. It’s a progress and investment strategy for sustainable business.
"Carrefour is well positioned to harness the full potential of the omni‑channel approach."
What are your priorities for this year ?
I have four main priorities for our teams in 2016. In terms of merchandise, I want us to keep working on our food offer. It’s our strength and is rooted in the Group’s culture. We should also refocus our non‑food offer, on what is permanent, seasonal or event‑oriented.
As regards our assets, Carrefour’s real‑estate management has been greatly professionalised over the past three years and we have been able to bring back modernity, comfort, and suitability to the commercial offer around our stores. At many of our sites, we started large‑scale real‑estate projects that will shape the future of our trade. The synergies between our hypermarkets and the Carmila shopping malls are going to be used to enrich the customer experience. The transformation work which has already begun will continue to move forward: conversion of Dia stores, incorporation of compact superstores in Spain, and the development of Rue du Commerce. In terms of finance, we are going to maintain a sensible, sustainable investment strategy. Our financial discipline allows us to ensure that our performance is steady and strong, and to satisfy the confidence of our shareholders.
Finally, one of our priority actions will be to emphasise employee training in order to boost their professional expertise, and help them along in learning how to deal with the use of new technologies, which will be an integral part of modern retail.
To summarise, we have a solid, promising business model with significant growth potential. I have the strong belief that Carrefour, a multi‑format, integrated Group that has an excellent territorial network, is well positioned to harness the full potential of the omni‑channel approach in the countries in which we operate.