Market Entry Strategy of Carrefour in South Africa: SWOT and 7Ps Analysed

Source: AnfaShopping 

SWOT Analysis of Carrefour

The following categorical analysis under SWOT is apt for understanding Carrefour’s possibilities in the markets of South Africa in particular.

 S (Strength): Carrefour’s biggest strength to dwell in the South African market is its French Connection. Since South Africa was once a French colony, Carrefour can very well establish its sophisticated French influence over the South African population and marketing will be easier for the company.

The next very significant point is the partnership of CFAO with Carrefour. This will increase the business scopes for the company and will offer it an extensive strategic planning to enter and sustain in the market on prolonged basis (Fresh Plaza, 2013). 

 W (Weakness):  Carrefour has got just one weakness with its reputation. It is the increased
competitive edge after Promodès acquisition. This has weakened its sales and market share in countries Brazil, Spain and above all its hometown France (Funding Universe, 2005).

O (Opportunity): Since there is none other than WalMart, South African market scenario to compete Carrefour; it actually attains open highway for initiating trades in the retailing sector.

 T (Threats): There are many threats that Carrefour must face in order to get into the markets of South Africa. The very notable one is that of that lack of appropriate mode of distribution and enough real estate space. Along with this the issues of red tape, instable political status and slow infrastructural venture are going to hinder it’s business strategies for sure.

7Ps Analysis of Carrefour

Theoretical approaches as noted under 7Ps, which are - Product, Price, Promotion, Place, Physical evidence, People, and Process; will be analysed in reference to the South Africa market entry of Carrefour. This will be analysed in relation with the products and services of the company.

Product: the most important thing about this P is that Carrefour must offer the people of South Africa good quality of products and services, but at the same time the same must suit their temperament and choices.

Price: every offered service or product must be within the budget of South African Customer. The manufacturing and the retailing units must understand the preferences to buy things in accordance to price tag.

Promotion: right kind of media exposure is mandatory. Assistance and collaborations with television, especially local news media and newspapers, instead of any social networking, are going to be of great help for promoting the brand of Carrefour.

Place: launching of the brand over media and establishment of the malls in squares of down town areas of Johannesburg and Cape Town can offer exclusive marketing facilities to the public (SACCG, 2011)). To get more accessibility of the relevant population, the company must lay emphasis on selecting locations that are close to market and free of hustles and bustles of the city life. 

Physical evidence: to offer a good impression over the population of South Africa, it is necessary to create an ambience within the mall to suit the cultural, social and traditional lifestyles of these people. As for instance, arrangement for family car parking zones, eat outs and some gaming zones for the kids.

People: concerns related to the employment structure, culture, management and customer services must get well synchronised in accordance to the consumer psychology of South Africa. Proper training to the customer care executives and management staff must be arranged to meet the aforementioned business objectives.  

Process: this P is about the service industry and the way the offered-services are consumed. In this matter, Carrefour must have a strategic approach that can support the provision of offering right kinds of customer services to the relevant and targeted customers. These strategies must be categorised in accordance to the age and financial status of the consumers.  

Sources

Fresh Plaza (2013) Carrefour is taking early advantage in Africa. 8/13/2013 http://www.freshplaza.com/news_detail.asp?id=112128 [Retrieved 5th September, 2013].

Funding Universe (2005) Carrefour SA History. International Directory of Company Histories. http://www.fundinguniverse.com/company-histories/carrefour-sa-history/  [Retrieved 7th September, 2013].

SACCG (2011) Doing Business in South Africa - 2011 Country Commercial Guide for U.S. Companies. South Africa Country Commercial Guide 2011.  U.S. and Foreign Commercial Service and U.S. Department of State, 2010.