Where did it all go wrong for Carrefour? That’s the question to ponder as the once-mighty French supermarket retailer closes the last of its stories in Xuzhou in northern Jiangsu. Its glimmer of hope? A brand-new business model.
On 27 June was posted a notice on the doors of Carrefour’s Xuzhou Jindi store advising as to opening hours for the following day. In fact, it was a formal farewell.
The knock-on effect was felt immediately by businesses sharing the shopping complex with Carrefour. With no more footfall to the supermarket, so they too starting to hang up notices, reading, “Due to the closure of Carrefour, this store is temporarily closed…”
Carrefour entered Xuzhou in 2000, opening up in the city centre, and with endless queues at the check outs, was able to sit back and enjoy the good times. At that time, even with competition from the likes of RT-Mart and Suguo, Carrefour was still thought to be the best.
But the clouds on the horizon were e-commerce and COVID. Both were to make life very difficult for Carrefour.
Beginning last summer, rumours began circulating that Carrefour was about to go bankrupt. Many people, especially those with stored-value cards, went a little nuts in buying up the retailer’s stock while they thought they could.
2023 was not about to get any better. Since April, no less than 12 Carrefour stores in China have announced their closures. Most sadly, they include their very first outlet in China, which opened in 1995 and was known as the country’s “first real superstore”.
As to the future, Carrefour is redefining its position with two different tiers of stores. Firstly, the giant branches that remain are likely to be repackaged as membership stores, in much the same vein as Sam’s Club.
Then there is that revealed by Zhang Kui, CEO of Carrefour China, at an internal meeting in March, as an article on Sohu reports. The key term was, “near-field retail-service provider”.
Publicly though, they are being called “community quality life centres”, and they are rolling out in Beijing, Kunming, Shanghai, Shenyang, Wuxi and other cities. Xuzhou too; expect them in Nanjing soon.
The move comes from the developments observed that when traditional retail is increasingly impacted by e-commerce, people’s shopping habits are more inclined toward community-based retail businesses.
It’s the right move to be making. With us all going on fewer and fewer trips to big supermarkets in favour of e-commerce and our brick and mortar shopping now at small local retailers (that pint of milk), Carrefour’s new model might just save them yet.
