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GRADE - XII MARKETING PROJECT (2017-18)

NAME OF STUDENT: LOVELL MENEZES

PROJECT SPECIFICS:  FUNCTIONING OF DEPARTMENTAL STORE

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 The Millennium School, Dubai
MARKETING

CERTIFICATE

Certified to be the bonafide record of the project work done by Master/Miss.

……Lovell…… of Grade XII as prescribed by the Central Board of Secondary Education, Delhi
during the academic year 2017 – 2018.

…………………… ………………………
Teacher in- Charge Principal

Submitted for the Practical Examination on………..2018

held in The Millennium School, Dubai.

……………………… ………………………
Internal Examiner External Examiner

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 ACKNOWLEDGEMENT

I , Lovell do hereby declare that this project is my original work and I

would like to thank Mr.Masood for his wholehearted support and guidance for
making it possible for me to complete this project on time.

I would also like to thank my friends and family members for their kind support and
guidance without which this project would not have completed.

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 “Visited a departmental store/retail shop or
consumer co-operative store located nearby to
study and report on the functioning of the
store or shop.”

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 INDEX

S.no Topic Page Signature

1 Cover page 1

2 Certificate 2

3 Acknowledgement 3

4 Project Topic 4

5 Index 5

6 Carrefour 6

7 Introduction 7-10

8 Functioning of the store 11

9 Product Mix 11-13

10 Price Mix 14-17

11 Place Mix 18-19

12 Promotion Mix 20

13 Major Competitors 21

14 Case Study 22

15 SWOT Analysis 23-24

16 Conclusion 25

17 Bibliography 26

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Founders: Marcel Fournier, Denis

Defforey, Jacques Defforey

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 Introduction

History of the founders

Carrefour emerged in 1959 as a collaboration between two
entrepreneurs, Marcel Fournier and Louis Defforey, in Annecy,
a city in eastern France that had become increasingly
industrialized since World War II. Both men came from
successful, enterprising families, and each was anxious to
expand his own business by building large supermarkets.
Fournier already had established the department store (Grand
Magasin de Nouveautés Fournier d’Annecy) and had
connections in the Casino supermarket company, and
Defforey was president of Badin-Defforey in Lagnieu.

History of the store

In the 1950s the French grocery industry consisted primarily of family operations. Traditional grocery
stores, committed to providing a variety of high-quality products, accounted for 83 percent of food
sales. As fewer young people entered into family businesses, however, and grocers' unions,
independent wholesalers, and food cooperatives increased in number, a need for alternatives to the
smaller markets developed. At the same time, big department stores, generally located in the center of
cities, often proved inconvenient, and the high prices they charged for luxury items and value-added
services were prompting consumers to look elsewhere for nonfood items.

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Moreover, the concept of free service was becoming increasingly popular. Free service, prevalent in
retail by the 1990s, was invented in 1916. Prior to its institution, consumers relied heavily on assistance
from sales clerks in selecting and obtaining merchandise. Under the free service system, however,
customers used bags, carts, or baskets to collect their needs--placed within easy reach and individually
priced--while sales clerks served primarily as cashiers.

The supermarket, which first appeared in France in 1954, used the concept of free service. With larger
facilities located outside the center of cities, supermarkets could provide fresher produce, a greater
variety of products, and lower prices than the traditional grocery store. By the end of the decade,
however, only 33 free service supermarkets were in operation in France, and none of them was
modeled after the large discount supermarkets in the United States.

Thus, in May 1959, Fournier and Defforey decided to incorporate these virtually unexploited concepts
for their store in Annecy. An offering of 7,000 shares of stock was made to ten stockholders, and a
facility already under construction in Annecy was purchased.

The ground floor of the building was to be used as the supermarket, while the upper floors, containing
apartments, were to be sold to help finance the business. Marcel Fournier was elected president, and
Denis Defforey, Louis's son, was chosen as general director.

Fournier named the business Carrefour, the French transliteration of the Greek word agora, or
marketplace.

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 Growth Profile

1959 - The Carrefour supermarket company is set up by the Fournier,

Badin and Defforey families who run a discount supermarket in
Annecy.

1960 - Carrefour opens its first supermarket in Annecy, Haute-Savoie.

1963 - Carrefour invents a new store concept: the hypermarket. The

first Carrefour hypermarket opens in Sainte-Geneviève-des-bois, with
a floor area of 2,500 sq.m, 12 checkouts and 400 parking spaces.

1969 - Carrefour invents a new store concept: the hypermarket. The first Carrefour hypermarket opens
in Sainte-Geneviève-des-bois, with a floor area of 2,500 sq.m, 12 checkouts and 400 parking spaces.  

1970 - Carrefour shares are listed on the Paris stock exchange

1976 - In April 1976, Carrefour launched a private label Produits libres (free products – libre meaning
free in the sense of liberty as opposed to gratis) line of fifty foodstuffs, including oil, biscuits (crackers
and cookies), milk, and pasta, sold in unbranded white packages at substantially lower prices.

1992 - Carrefour creates filière quality systems, which guarantee product origin and traceability.

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2000 - The Carrefour Foundation (Fondation d'Enterprise Carrefour) is a philanthropic fund created by
Carrefour in 2000 to support social welfare programmes 'linked to [its] core business as a retailer' in
countries the company operates and in countries where its suppliers are located.

2011 - In May 2011, Carrefour reviewed its situation under conditions of stagnant growth and increasing
competition in France from rivals including Casino Guichard-Perrachon SA, and planned to invest €1.5
billion ($2.1 billion) to change the supermarket with the new concept of Carrefour Planet in Western
Europe.

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 Functioning of the store

1. Product Mix

1. Toys :
Some of the products in this category are :
i) Majorette - Lamborghini 5pcs Set Giftpack
ii) LEGO 60137 "Tow Truck Trouble" Building Toy

2. Home and Festive Decor :

Some of the products in this category are :
i) Christmas Gift Parcel 5Cm Gold
ii) Pinecone With Glitter 5Cm Gold

3. Smartphones , Tablets :
Some of the products in this category are :
i) Apple iPhone 8 256GB Silver
ii) Apple iPad Pro 512GB WiFi+Cellular 10.5" Space Grey

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4. Groceries :
Some of the products in this category are :
i) Milco Natural Yoghurt Full Cream 400g
ii) Golden Loaf Milk Buns 220g

5. Home Appliances :
Some of the products in this category are :
i) Miele Washer Wkg120 8Kg
ii) Samsung Microwave Me6194St

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6. Health & Beauty :
Some of the products in this category are :
i) Philips Hair Dryer Hps910
ii) Head Treadmill W/ Auto Incline 2Hp

7. Outdoor Living :
Some of the products in this category are :
i) Trampoline 8Feet With Ladder
ii) Intex Prism Frame Round Pool (305x76cm)

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2. Price Mix
The following are the prices of the above mentioned product categories :

1. Toys

2. Home and Festive Decor :

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3. Smartphones , Tablets :

4. Groceries :

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5. Home Appliances :

6. Health & Beauty :

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7. Outdoor Living :

Pricing method used

Carrefour generally follows ‘ Everyday low pricing ’ strategy, which means that the prices of the
products are set according to everyday demand and supply. They use this strategy for perishable goods
, and the prices differ even on the basis of early hours of market and late hour of market .

However, the major portion of the revenue comes from the sale of Carrefour’s own brand products
which are priced as per the demand , which is the ‘ Demand oriented pricing ‘ strategy .

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3. Place Mix

Branches

Location Dubai Manar Mall

Abu Dhabi Al Shindagha Sharjah

Abu Dhabi Marina Mall Arena Mall Dubai Sports City Sharjah City Center

Airport Road Abu Dhabi Century Mall, Al Mamzar

Bawabat Al Sharq Mall, Baniyas Deira City Center

Dalma Mall Dubai Investments Park (DIP)

Deerfields Town Square Mall of the Emirates (MOE)

Ajman Madina Mall

Ajman City Centre Mirdiff City Center

Al Ain Umm Suqeim, Al Wasl Road

Al Jimi Center (Mall) Fujairah

Bawadi Mall Al Ain Fujairah City Center

Boutik Al Ain Ras Al Khaimah

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Suppliers

There are a large number of suppliers for Carrefour , many are small wholesalers , and others are
directly from manufacturers like:
- Global Food Industries LLC
- Arab & India Spices LLC
- McCain International Inc

Carrefour has more than 12,000

stores operating in more than 30
countries in Europe, America, Asia
and Africa. Carrefour has ensured
its presence in 19 integrated
countries and has franchised stores in 20 other countries. The group, in addition to the traditional
format has developed a wide range formats to cater to all kinds of shopping pattern, be it daily
purchases, weekly hypermarket visits or bulk buys by business customers.

Buying through electronic auctions is an unavoidable standard of the Group which allows to a quick,
transparent and fair decision.This type of negotiation is used since 2000 (1000 users in 18 countries),
with proven value added such as transparency in negotiation and formalization of buying processes.

Suppliers are selected and invited by Carrefour in accordance with our usual selection rules (quality,
ethic, SME protection). The RFQ (Request For Quotation) allows the evaluation of the market trend and
the cycle of price qualification to select suppliers who will participate to the auction.

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4. Promotion Mix

Advertising
Since Carrefour is a large international organization , it has a lot of financial resources . The main point
of advertising is to inform and convince customers about products in a very attractive way . Unlike other
local retail stores , Carrefour indulges in a more aggressive advertising strategy , they use both internal
and external medias of advertising . Carrefour uses ‘ Through-The-Line Promotion ‘ . Internal medias
used are newspapers and magazines , and the external medias used are mobile advertising ,
billboards , posters .

Sales Promotions
Types of sales promotion offered are:
- Free offers
- Extra fill packs
- Discounts
- Coupons
- Sale

Personal Selling
There is very little personal selling used by Carrefour , the concept of ‘ free service ‘ is used , where
customers choose whichever products they feel like , and are not pursuaded by the store employees to
buy certain products . Store employees provide information to customers if they need to know more
information other than what is already mentioned .

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Major Competitors

1. Lulu Hypermarket
The UAE economy has shown such robust growth that the
hypermarket has opened its 88th Hypermarket in Baniyas.
At present, the retail sector in UAE is seeing aggressive
expansion efforts by the market leaders like EMKE Group.
The hypermarket sells groceries, food, drinks and domestic
products. They also have a wide range of brands like the
IKON products which encompasses hi-tech gadgets and
home appliances. Another brand is the Lulu products which are comprised of food and non-food
products that have been manufactured by international companies.

2. Spinneys
As of 2011, the Spinneys Group Limited is a premium
supermarket retailer in the Middle East, and operates
hypermarkets and supermarkets . They provide a very
similar offering to Carrefour , and have begun an
aggressive expansion strategy similar to that of Lulu .

Therefore , Carrefour should always keep a keen eye on its competitors , otherwise they will loose their
market share to the competition . By analyzing the competitors actions , they can adjust the sales and
marketing strategy accordingly .

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Case Study

Business Challenge 1:
A recent problem faced by Carrefour is the introduction of tax
on carbonated and energy drinks , which has led to a rise in
their prices . Carrefour wanted to find a solution to the problem
and solve it so that there wont be any decrease in sales or
profits .

Solution:
Carrefour solved this problem by promoting healthier drinks like
fruit juices on which there is no tax so that customers continue
buying products in place of unhealthy drinks .

Business Challenge 2:
To maintain its leadership in the increasingly competitive retail grocery industry, Carrefour sought to
gain more control over its marketing processes and more effectively leverage its business intelligence—
with the ultimate aim of strengthening customer loyalty.

Solution:
Carrefour teamed with IBM and its partners to put in place a groundbreaking in-store promotion system
across its supermarket and hypermarket stores—operated entirely by Carrefour—that enables the
planning and execution of more targeted campaigns, with more rapid feedback as to their
effectiveness.

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SWOT Analysis

Strengths

- The largest hypermarket in terms of its size.

- Currently, the retail store is the third in the world in terms of profit after Tesco and Wal-Mart. This
gives them the resources for expansion and shows they have a good market share.
- Its joint venture in different countries has given it experience in international expansion and has
increased its market share.
- It has a network of grocery, discount and convenient cash and carry stores and supermarkets and
hypermarkets.
- It has a wide range of products, services and has several brands.
- It operates in 31 countries of the world and has the strongest brand in the retail sector.

Weaknesses

- It has a very weak position in the Middle East and the Asian markets.
- It has high operating expenses.
- It has poor labour relations with the employees and unions.
- It has spent too many resources in the expansion efforts.
- Their own brands have a weak market segment.
- They have a poor e-commerce strategy.

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Opportunities

- The many joint ventures and acquisitions which the company has engaged in provide room for
expansion and diversification.
- They have been able to develop their discount stores effectively.
- They also have been able to reduce their operating costs in the recent years.
- They are in the process of improving their labour relations.
- They are making use of research and development in marketing.

Threats

- Stiff competition from other retailers like EMKE and Spinneys

- They are being threatened by the low prices that local groceries offer
- They are facing the challenges of operating in the Asian and Middle East markets that have become
too dynamic for the company.

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Conclusion

By doing this project , I learned about the Carrefour brand and chain of retail stores in a very detailed
way . I learnt that though they are very successful , they still face a lot of problems and challenges which
must be overcome for them to remain successful .

Carrefour is one of the largest retailers in the Middle East and has a lot of scope for success in the
future if they keep adjusting to the business environment , and respond to the threats in a better and
more efficient way .

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Bibliography

- http://www.fundinguniverse.com/company-histories/carrefour-sa-history/
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- http://www.carrefour.com/group/presentation-of-the-group
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- http://www.carrefour.com/content/history
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- https://www.carrefouruae.com
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- Class 12 Marketing handout
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- https://www.mbaskool.com/marketing-mix/services/16808-carrefour.html
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- http://www.carrefour.net/en/articles.html?t=47
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- https://en.wikipedia.org/wiki/Spinneys

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