French distribution group Carrefour is rumoured to exit up to nine countries this summer, after a publication by leading French analysts concluded neither new markets, nor new formats have been able to improve the group's results. Italy, Turkey and Belgium are among the possible targets for cuts, says the ING report.
According to the analysts, CEO elect Georges Plassat will have to resort to firm actions when he announces his company's half year results, as his predecessor's tactics failed to deliver. Emerging markets did not bring the positive results current CEO Lars Olofsson was hoping for, and neither did his plan of resuscitating Carrefour's hypermarkets – which used to be the company's pride, but are now Carrefour's achilles heel.
Leaving nine countries would make competitors hungry
Plassat is to take over in July, and his first message will have to be one of severe measures, ING concludes and names Argentina (658 stores, according to Carrefour's latest figures), Belgium (632), Greece (897), Italy (1302), Malaysia (39), Poland (335), Romania (55), Taiwan (63) and Turkey (1138) as the countries that are in danger. Even China and Brazil, which the report claims to be Carrefour's best markets, are not doing well.
This report will be music to the ears of some competitors, especially Dutch group Ahold (Albert Heijn in Europe, Giant in the US), which only last week announced to “raise their ambitions, both locally and internationally”. Maybe Ahold can even realise its old dream of taking over Carrefour's activities in Belgium, while Belgian chain Delhaize might be interested in Turkey, one of its two empty spots on the Balkan map – along with Macedonia...