Carrefour’s Upbeat on Retail Business in India

Retail co prefers multi-format stores to cash and carry

SAGAR MALVIYA BERLIN

Carrefour, the world’s second-largest retailer, said it is upbeat about the wholesale business and plans to expand even if India does not allow foreign retailers to sell multi-brand products to consumers directly.
“It’s a challenging market and very complicated from the regulations point of view, but we are determined to win. We were doing a study recently and we know that India is one of the countries where we have to be faster and have to accelerate,” said Jose Carlos Gonzalez-Hurtado, chief commercial officer at Carrefour Group, and added that cash and carry is not the retailer’s typical format and the company would ideally want to open multi-format stores here.
When asked why Carrefour has not partnered any Indian player so far — unlike rivals Wal-Mart and Tesco who have tied up with Bharti and Tata Group respectively — the French retailer admitted that they have not been ‘very fast’ despite talking to several India retailers for over five years. “We have not been very fast. But there were other priorities. We were disengaging from some markets, in Asia and Russia,” Gonzalez-Hurtado told ET on the sidelines of World Retail Congress at Berlin.
However, regulations on allowing foreign direct investment (FDI) in the Indian retail market were not the only reason for the delay. “I am not sure if it is only FDI or not, but for sure we have other priorities,” he added. The number of things that Carrefour had to transform in the last three years was incredible. We have to put the house in order,” he added. Currently , Carrefour with sales in excess of euro 100 billion is in the midst of a threeyear turnaround plan in several existing markets, while at the same time expanding in emerging markets.
Carrefour also said that it expects the Indian operations to be as big as China’s, where it is the fifth-biggest retailer with annual sales of $3.2 billion after opening its first store in 1995. “India is as important for us in the future as China was at one time. The only difference is that it is less competitive today with less global players,” said Gonzalez-Hurtado.
But existing retailers in India are making sure that it won’t be easy for Carrefour even in wholesale business. The world’s largest retailer Wal-Mart already has nine cash-and-carry stores in India through a JV with Bharti Enterprises. Reliance Industries, which opened its first cash-and-carry store this month plans to open another 15 in a year. Even Britian’s Tesco plans to open its first wholesale store by next year. Carrefour, on the other hand, opened its first wholesale store only last December.