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Hypermarkets in France
Hypermarkets in France a new deal.
In France, consumption declined in most Hypermarkets in 2019. The glass is half empty or half full. Optimists will find that two thirds of the Carrefour Hypermarkets in France make money. Pessimists will point out that a third of the park pulls down the result of the branch. The issue is also sensitive to Auchan, the other chain of very large Hypermarkets. In its December issue, the trade magazine “Linear” examined the “evil of self-service hypermarkets” and advanced “the real numbers”. The trade magazine recalls that the self-service hypermarkets Carrefour, Auchan and Casino recorded sales of 2.7 billion euros between 2014 and 2018, of which one billion for the first two. Consumer habits are changing. Consumers commute less and tend to local supermarkets. The shift from non-food shopping to e-commerce and specialized supermarkets also explains the dissatisfaction of certain Hypermarkets. “Linear” keeps its figures from union sources. According to this information, the decline in sales is associated with a decrease in profitability. Carrefour France’s hyper integrated and franchised companies reportedly had a current operating deficit of 132 million euros in 2018. For comparison: Auchan Retail France generated a profit of 479 million in 2014. Operating profit (80% of activities are carried out by Hypermarkets) decreased to -155 million. The magazine also confirms that “89 businesses would make losses” at Carrefour Hypermarkets SAS ‘191 locations in 2018. The Carrefour Group does not comment on these figures, which it does not publish. In an interview with “Linear,” Marie Cheval, general manager of consumer markets, only states that 41 Hypermarkets will launch Rebond, “an operating model that inspectors entrust to directors to compensate for deteriorating profitability.” Dejan Terglav, General Secretary of FGTA-FO from Carrefour, responds to “Les Echos” and assesses all these figures as “likely”. He fears that the group will default to leasing around twenty hypermarkets. Carrefour has started to revive its consumer markets. 2018 is the first of the Group’s transformation plan that has invested particularly in competitiveness and prices. This strained numbers and margins. Kepler Cheuvreux underlined this “conscious strategy”. Since then, sales space reductions have been initiated, such as the rental of space to Darty. The Hypermarket soldier needs to be saved.