1. Background of the Carrefour.

A hypermarket or multi department store is a superstore which combines a supermarket and a department store. The result is a very large retail facility which carries an enormous range of products under one roof, including full lines of groceries and general merchandise. When they are planned, constructed, and executed correctly, a consumer can ideally satisfy all of his or her routine weekly shopping needs in one trip. The example of hypermarket have been set up in Malaysia is Carrefour, Tesco, Jusco, and Giant (foreign hypermarkets) besides other local hypermarket such as Mydin. Following are background of the Carrefour hypermarket and Mydin hypermarket. The first Carrefour store opened on 3 June 1957, in suburban Annecy near a crossroads (carrefour in French). Today it is the smallest Carrefour location in the world. The group was created by Marcel Fournier and Denis Defforey and grew into a chain from this first sales outlet. In 1999 it merged with Promods, known as Continent, one of its major competitors on the French market. Marce Fournier and Denis Defforey had attended several seminars in the United States led by "The Pope of modern distribution" Bernardo Trujillo, who influenced other famous French executives like douard Leclerc (E.Leclerc), Grard Mulliez (Auchan), Paul Dubrule (Accor), and Grard Plisson (Accor). Their slogan was "No parking, no business." The Carrefour group pioneered the concept of a hypermarket a large supermarket and a department store under the same roof. They opened their first hypermarket 15 June 1963 in Sainte Genevive des - Bois, near Paris in France. 1976 Carrefour introduces produits libres which are unbranded product but just as good, and cheaper. In 1992, Carrefour creates filiere quality systems, which quarantee product origin and traceability. Carrefour opened their first hypermarket 1994 in Malaysia.

In Malaysia, Carrefour is a leading hypermarket chain selling a wide range of household grocery products ranging from frozen goods and fresh products to textiles, garments and shoes, as well as electrical goods such as home kitchen items and audio - visual appliances. Carrefour is widely recognised as a convenient one - stop shopping centre that caters to a mix of consumers from housewives to students and working professionals. MYDIN and its first store were introduced by Tuan Mydin Mohamed in 1956. The first store started by selling toys from Thailand in Kota Bharu, Kelantan. The second branch in Kuala Terengganu in 1979 saw Encik Murad Ali, the eldest son of Tuan Mydin in charge. In less than 10 years, the third of MYDIN branch which marked MYDINs rooted presence in the Klang Valley was opened at Jalan Masjid India by Dato Ameer Ali. MYDIN was incorporated on 23 July 1991 under the Companies Act 1965, as a private limited company under the name of Melati Makmur Sdn Bhd. The reason to incorporating the business was to take over the business of Syarikat Mydin

Mohamed, which was a sole proprietorship, founded in 1957 by Encik Mydin

Mohamed and Syarikat Mydin Mohamed Brothers, a partnership formed between Encik Mydin, Rowshan Bhai a/p Kassim Bhai, Murad Ali bin Mydin Mohamed, Dato Ameer Ali bin Mydin, Ahimmat bin Mydin Mohamed and Salim bin Mydin Mohamed. The Company, on 17 January 1992, had changed its name to Mydin Mohamed & Sons Sdn. Bhd. Subsequently on 25 June 2001, the company became Mydin Mohamed Holdings Sdn Bhd and is presently known as Mydin Mohamed Holdings Bhd.

From then on MYDIN has grown steadily and at a commendable pace. With its vision, to be the leading Malaysian Wholesale Hypermarket in Malaysia, it is now known as MYDIN MOHAMED HOLDINGS BERHAD. From establishing its headquarters in 1991 in

WISMA MYDIN at Jalan Masjid India, its Board of Directors have worked towards the companys vision and mission which in 47 outlets nationwide inclusive of 3 Hypermarkets, 19 Emporiums, 2 Superstore (Bazaar), 14 Mini Markets (MYMydin), 4 Convenient Stores (MyMart) , and 5 Mydin Mart which is part of its franchise program.

With the continuous belief that hard work, teamwork as well as strong customer relationship are the fundamentals to a successful business, this is what led to the opening of MYDIN WHOLESALE HYPERMARKET in USJ 1, Subang Jaya on 19 August 2006. Far from resting its laurels, MYDIN is still forging ties with the guide of its vision and the next MYDIN wholesale hypermarket is already at the finishing stages.

Carrefour vision of the world at the dawn of the 21st century In the 21st century, hundreds of millions of men and women will become part of the consumer society within a globalized economy. Globalization does, however, pose new types of risk for both human society and our planet. Faced with such risk, and in order to improve prospects for future generations, it is crucial to follow the path of sustainability, which combines economic profitability, respect for the environment and both social and ethical development. Vision of Carrefour in Malaysia The hypermarket for Malaysia, with a strong sense of belonging and ownership thus upholding a unique identity led by price & service. Mission Carrefour are totally focused on meeting the expectations of their customers. Carrefour mission is to be the benchmark in modern retailing in each

of their markets, by offering : Their customers: the best prices and the best merchandise, in every banner and every country. Their staff: the possibility of growth and fulfillment in a trusting environment, with interesting jobs and motivational compensation. Their shareholders: a sustained return on their investment and the growth prospects of a global, multi - format retailer. Their partners, franchisees or affiliates: leading banners and brands, marketing and sales expertise, purchasing power and constantly improving techniques. Their suppliers: markets, customer intelligence, and cooperation to improve

products through long - term, mutually beneficial relationships. Public, local and national authorities: a deep commitment to the community, as a socially responsible economic actor and good corporate citizen. Objectives  Improve customer satisfaction  Improve profitability  Significant reduction in excess inventory

Carrefour core values Carrefour core values are the heritage of all the people and companies that have built the Group. Freedom: Respect the customers freedom of choice through a variety of store formats and a diversity of products and brands. Develop this freedom by

providing thorough, objective information. Give consumers the freedom to buy at prices consistent with their purchasing power. Provide the largest number of people with the opportunity to purchase consumer goods. Empower all staff to take initiative. Responsibility: Fully assume the consequences of their actions on customers, their company and staff, institutions and the environment. Sharing: Leverage their expertise and strengths to create value, which is shared among customers, staff, shareholders, partners and suppliers. Respect: Respect their staff, suppliers and customers. Listen to them and accept their differences. Understand and respect the lifestyles, customs, cultures and individual interests in all countries and regions where we do business. Integrity: Stand by their commitments and act honestly towards customers, staff and suppliers. Act with integrity, both as individuals and as a group. Solidarity: Contribute to the development of the local economy, job creation, training and the fight against social exclusion in the communities, countries, towns, cities and neighbourhoods where they operate. Implement a policy of fair trade by developing value sharing. Express professional solidarity within the Group regardless of their personal skills, function or banner. Progress: Support progress and the development of new technologies to serve the needs of people. Embrace change in a pioneering spirit and encourage innovation.

Carrefour shareholders Carrefour is a public limited company with a share capital of

1,790,354,427.50 euros divided into 716,141,771 shares and with some 460,000 shareholders. Carrefours employees own 2.98% of the Groups share capital. Their attention to social and environmental performance preserves their share

price and attracts new investors sensitive to social and environmental issues. Carrefour strives to guarantee to its shareholders the transparency of its corporate governance. Ethical, social or environmental issues are dealt with by Carrefours key decision making bodies : The Board of Directors is Carrefours main governing body. It comprises 11 members of whom 3 are independent directors, and is assisted by a Strategic Steering Committee, an Audit Committee and a Wages and Salaries Committee. The Executive Committee is the backbone of Carrefours management

structure. Under the impetus of its chairman, it recommends strategic directions and guidelines and organises their deployment. Its membership reflects the way the Group is structured per geographic area with cross - sector support functions. The Quality & Sustainable Development department, which manages the

sustainable development programme, reports directly to the CEO and advises the Executive Committee on sustainability issues.

Carrefour products

Besides, With its customers needs in mind, Carrefour decided in 1985 to replace its "produits libres", generic product line created in 1976, with an own brand line, which is produced for the most part by small - and medium - sized businesses and manufacturers. Today, Carrefour sells over 2,000 products that meet very strict specifications with regard to their price / quality ratio, taste, authenticity, food safety, traceability and innovation. Carrefour also sells 5,000 non - food products under its own brand names. Outside laboratories conduct quality audits of our non-food products at various stages in their production to make sure they meet our specifications. Carrefour's organic line now offers 130 products in its fresh food, grocery and frozen food aisles. All products in the Carrefour organic line are inspected and certified by the independent certification organization ECOCERT, and must meet organic farming specifications (no chemical fertilizers, no synthetic pesticides). Everyone who works with Carrefour to produce its organic line makes

a long - term commitment to adhere to demanding production control and product tracking specifications. Regular inspections are conducted at every stage of the manufacturing process, up to and including inspections of the finished product.

Carrefour market positioning Carrefour positioning does business, its stores have further moved its market and

towards the

discount end

through

a policy of

low prices

largescale promotions. The banners concerned by the conversion to the euro locked in their prices through May 2002 and maintened a freeze on own brands over the whole year. The price positioning was supported by many promotional campaigns. In the first half, Carrefour won back market share in Brazil by conducting three short promotional campaigns a week. In the second half, the groups 40th Anniversary offered a worldwide opportunity to display the competitive nature of the product range. Other international promotions such as the ones in countries involved in the World Football Cup, helped to boost the stores financial performance.

Carrefour branches With operations in 30 countries, Carrefour is the worlds second largest retail group. It is the number one retailer in Europe. Carrefour has also been present in the Americas since 1975 and in Asia since 1989. This success stems from their ability to adapt their strategy to fit local markets and to make globalisation an Opportunity for progress. Wherever they do business, they strive to raise local standards in terms of quality, service, working conditions and preserving the environment. They also mindful of their contribution to the labour market, in some countries, like Argentina. Carrefour is the largest private sector employer. Following are Carrefour branches surrounding world:

Americas Country Argentina Brazil Colombia Dominican Republic Asia Country China Indonesia Japan Jordan Kuwait Malaysia Oman Qatar Saudi Arabia Singapore Taiwan Thailand United Arab Emirates Africa Country Algeria Egypt Tunisia First store Hypermarkets Supermarkets Hard Discounters 2005 2002 2001 1 5 1 2 First store Hypermarkets Supermarkets Hard Discounters 1995 1998 2000 2007 2007 1994 2000 2000 2004 1997 1989 1996 1995 122 37 7 1 1 12 2 3 5 2 48 25 11 275 First Hard Convenience Hypermarkets Supermarkets store Discounters Stores 1982 1975 1998 2000 59 150 46 1 103 38 395 300 5 Cash & Carry 34 -

Europe Country First Hard Convenience Hypermarkets Supermarkets store Discounters Stores Cash & Carry

Belgium France Greece Italy Poland

2000 1960 1991 1993 1997

56 218 28 59 72 11 161 19

280 1,021 210 485 277 21 87 99

897 397 471 2,912 519

257 3,245 216 1,015 5 3 -

134 20 -

Portugal 1992 Romania 2001 Spain Turkey 1973 1993

ii. Market positioning strategies used by Carrefour

Market positioning is the act of designing the companys offerings and image to occupy a distinctive place in the mind of target market for its product, brand, or organization. It is the 'relative competitive comparison' their product occupies in a given market as perceived by the target market. Market positioning strategy used by all retail industry such as foreign hypermarket. Below type of market positioning strategy used by retail industry .

Market Positioning Strategy.

In Malaysia, Carrefour became a top four retailer, in terms of sales, pushing out the local retailers. Although Carrefour has been successful had many local department stores and small l- scale supermarkets, there were large - scale chain stores or large scale discount shops selling electrical household appliances or clothing. Without differentiation, Carrefour has not been successful in Malaysia. Carrefour used to differentiate products that are offered based on following aspects : The product itself Services offered Company staff or personnel Distribution channel used Company image

y y y y y

A competitive advantage can be gained through hypermarket, brand and store image. For example, brand such as Carrefour establish a strong global brand. Likewise, in have worked hard to Carrefour have Malaysia ,

established a clear store image that is associated with high quality. Besides, Carrefour developed a strong image through the use of slogans and symbols. For example, the 'Lebih Jimat Lebih Hemat ' slogan have enhanced the image of this hypermarket.

Based on products differentiation Product offered by Carrefour is a basis to differentiate other hypermarket product. The bases used in Carrefour hypermarket are :

Quality

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Quality is one of Carrefour main source of competitive differentiation and is part of the fundamental policies defining the implementation of the Carrefours strategy. It always corresponds to what the customer explicitly or implicitly wants and must be clearly perceived as such. The value for money must be the best. Controlled products whether banner brands or own brands, offer exemplary quality and safety. A product must demonstrate the required quality level before it can be approved for purchase.

Guaranteeing food products safety and quality

The best possible value for money is offered at every price level (first price products/ own brand and banner brand products). For own brand and banner brand products, the quality process includes signing a set of specifications, approving production sites and product control plan, processing and archiving any con-compliant products and following up of customers claims. To complete this system, Carrefour has deployed in 2005 a Quality Scorecard available on the intranet site, which enable all the Carrefour to track products at every stage of their marketing and to react more efficiently in case of a crisis.

An approach shared with our suppliers To guarantee the quality of its food products and its own brand and banner brand products, Carrefour systematically conducts audits on its suppliers production sites, which are audited health and safety conditions. Suppliers production sites are audited by Carrefour, its service providers or certification agencies. Suppliers are audited with respect to health and safety conditions, risk control, traceability and compliance with specifications. In addition, Carrefour endeavours to verify progress in product development . In 2004, specific criteria for environmental factors were set up, along with the training of auditors in several countries also Malaysia.. These audits are followed by action plans

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arranged with suppliers to improve the production process. Moreover, thanks to analysis made by its customers services, the Carrefour shares with its suppliers the points of satisfaction or of improvement reported by the claims.

Providing their customers with freedom of choice

Carrefour is committed to offering its customers broad freedom of choice by structuring its product mix to include major national brands, regional, own - brand, retail banner and first price products. The Carrefours own brand, retail banner and first price products give the customers a selection of non GMO and organic products as well as the opportunity to choose quality at price that suit every pocketbook.

Quality at the best price: first price products

First price No1 products launched in Malaysia. Drawing on synergies and purchasing volumes at the Carrefour, these products are intended to offer consumers quality products at a price that is 5% to 7% below hard - discount prices. In addition to meeting existing legal requirements, No1 products also reflects the quality and safety approach that characterizes all their own brand and banner brand products. Carrefour has decided to apply the same position for No1 products as for own brand and banner brand products by excluding genetically modified organisms from the composition of all products.

Quality information on non - food products labels

To promote the quality of its own - brand products and retail brand products among consumers, Carrefour hypermarkets decided to optimize the quality of information on the packaging of its Carrefour brand non - food products. Four criteria, symbolized by four icons, were adopted, referring to usage, safety, health

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and the environment or social conditions of production. The packaging points out the most striking criterion for each product by explaining in one or two sentences the products added - value. This is signed with the commitment logo of Carrefour, which provides Consumer services with evidences of its procedures. Carrefour has already used this method on paints, backpacks, toys and scents. This approach will be extended to include childrens products, paper goods, sporting goods and food containers.

Ensure in store safety and quality

The proper upkeep of stores and the respect for the cold chain and food safety are key elements of the Carrefours policy in Malaysia . Thus the Carrefour mobilizes all its employees to ensure respect for health and safety rules. This involves training, establishing procedures, and systematic hygiene and quality audits in stores and warehouses.

Improve nutritional information on food products labels

Facing with a disturbing rise in food-related problems and to help customers to combine food products better for a more balanced diet, in early 2005, Carrefour has optimized the labelling of its Carrefour brand products. The Carrefours Commercial Department has worked with the CLCV to develop a more accessible and helpful presentation of nutritional information. The packaging has now a nutrition box indicating the share of daily needs for six main nutrients ( fats, sugar, carbohydrates protein, fibre and salt) provided by the products. This nutrition box has been deployed in several countries and in Malaysia.

Brands

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Carrefour brands are comparable in quality of perhaps better known market leaders, they boast of innovative, value - added features that enhances the quality of life. All product categories are represented by the Carrefour Brand, from daily necessities such as cheese and pasta, to cosmetics and clothing. Carrefour making the brand work harder because Carrefour want:    Increase CUSTOMER Awareness Increase EMPLOYEE Pride Increase SHAREHOLDER Returns

Carrefour have only begun to capitalize on the strengths of

the brand

because making the brand work harder will help Carrefour grow sales and profits in Malaysia. Carrefour understand Customer knowledge that Single brand to serve all customer needs and even further the performance of their growth markets. The brand has a crucial role in the economic model and the relationship with the customer. The brand guarantees for each product the values of the Carrefour. Besides, after the initiatives launched in 2005, Carrefour own label is ready to play the role of a true brand, recognised for its quality, its commitments, and its accessibility to the customer, (not simply a copy or an alternative price point).

The quality and safety of products sold in Carrefour stores is one of the Carrefours priorities, notably for their store brand food products and retailer brands. For these items, Carrefour works closely with its suppliers to ensure the traceability and their bacteriological quality of products as well as the implementation of the precautionary approach and a rapid recall procedure. In 2002, Carrefour set up a Safety Observatory for its own store brand products. Carrefour also developed a Quality Management Chart, a data processing tool that can predict and manage risks by monitoring controlled products throughout preparation.

Based On Staff Or Personnel Differentiation

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The Carrefour has had successful financial results, has gained market share, and makes customer happy. This is a reward for all employees, as all of them play a role in this result. In fact, over 90% of the employees work in contact with customers. That means that customer happiness is closely linked to the employees performance. The Carrefour has developed various tools, depending on the employees position to assess the employees performance. For instance, tools for cashiers include such indicators as turnover and absenteeism.

Participating in the strategic plan A number of teams participated directly in the preparation of the strategic plan through participating. In task forces that brought together people from all store formats and all geographical areas. Being linked to the global strategy is a great motivation for store managers. Moreover, the strategy is probably more appropriate this way, so it is in turn easier for managers to implement the programs with the employees.

Listening to Employees tool Since 2000, hypermarkets have systematized listening to employees to assess their satisfaction. Over 8,000 persons, both managers and employees, used it to express their point of view. It enables the Group to have a fair overview of labour relations, to adjust its management style and to draft action plans that factor in employees recommendations and comments. Besides, general staff benefits include such as

y y y y

Contractual Bonus Service Awards Programme Out Patient Treatment Benefits Group Personal Accident Plan

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y y

Group Health Plan (Cover includes immediate family members) Structured Skills Caree) Career & Development (Programmes Structured Skills

Additional benefits for Non-Executives include allowances for:

y y y y y

Transportation Attendance Punctuality Cashier ( cashier only ) Festive incentive ( ie: Hari Raya, Chinese New Year, Deepavali)

At Carrefour, they constantly strive to be a responsible corporate citizen and undertake various measures to give back to the community and society as a whole. Carrefour strive to make a difference in the lives of the community from the urban to the rural and they are driven by the belief that all life is special and deserves attention. Carrefour believes in operating business with integrity and commitment to quality. This conviction that begins with us as an individual and through this inward conviction, Carrefour will make a difference in the lives of people around Malaysia.

Personnel Differentiation

The Carrefour Group has formalized its progressive approach based on three key commitments: quality and safety, respect for the environment and economic and social responsibility.

Safety commitment on Drug Perfume and Hygiene products (DPH)

All suppliers are required to abide by Carrefours policy on cleaning, detergent and cosmetic products. No cosmetic product has been tested on animals by Carrefours purchasing office or on its behalf for 10 years. Products

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and their formulas are rigorously scrutinized by a team of six internal specialists, with the support of an additional team of recognized external experts. Some of the groups banners are taking this approach even further.

Safety commitment on textiles and clothing for babies and children

In 2003, Carrefour has developed specifications to improve the safety of clothing and textile products intended for children and babies. In two years, more than 5,000 textile products involving over 200,000 substances were tested by independent agencies. This safety requirement has been boosted by regular monitoring conducted with the help of specialists, toxicologists and allergists for all textile products.

Based On services Differentiation

The Carrefour puts its customers at the heart of everything it does. To this end, it has simplified its organization, giving more independence to store managers to enable them to adapt their business as closely as possible to the needs of their catchment area. Alongside this, the Carrefour has expanded customer choice, adapted its store brand ranges and increased its service offering. New store concepts have been introduced to respond to evolutions in their customers lifestyles. For some years now, the Carrefour has also been strengthening its loyalty programs around this country to ensure that they reflect the latest consumer and social trends. Over the years, Carrefour has added numerous practical and accessible services to its offering. The Carrefour has thus become a competitive player and the benchmark in several areas of activity outside of its core business line. Carrefour made significant capital expenditures in 2002 to reconfigure its stores to make them more attractive and improve customer service. Reorganized sales areas and product staging make the best of the Carrefours various areas of expertise. This applies to both the food and non food areas in hypermarkets. At

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Carrefour, they welcome customer views and comments which will help them improve their service to customer. Services given by Carrefour are :

Extended Warranty Free parts & labour on items repaired within the extended warranty period. Replacement Plan Free 1 new replacement for items in 2nd year within the extended warranty period.

Easy Payment Scheme Interest rate at 1% to 1.5% monthly. Please visit our Easy Payment Scheme counters for more information. We have payments schemes for durations of 6, 9, 12, 15, 18, 24 & 30 months.

0% Interest Free Terms & Conditions apply. For Maybank & Southern Bank Card Holders only.

Free Delivery Service Free delivery for selected items within 30km radius of our stores.

Textiles Alteration Service Hemming alteration for Carrefour customers.

 

Wrapping Service Cutting Service Scalling / Cutting service for meat products upon request

Handicap Friendly Store Facilities Wheelchairs, lifts and parking spaces is available for disabled customers.

Automated Teller Machines

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Food Court Surau / Moslem Prayer Room Baby Changing Rooms Taxi Stand Bus stand

iii. Carrefour success analysis. As in many other businesses, it is a crucial point for the Carrefour to learn about their customers and to do everything they can to satisfy them. Thus Carrefour has defined what builds up a positive experience for the customer; apart from the differentiation strategies, price positioning strategies, distribution channel and marketing mix, can see that the success factors contribute on its products or services. The Carrefour such as:    Convenience goods (food products, gas) which are sold by all formats of retail stores. Shopping goods and services (household appliances, electronic devices) which are sold by hypermarkets only. Cash & Carry and wholesale stores sell industrial goods (mostly food) as they sell to businesses (food trade professionals). Carrefours success factors used on its product are: The Carrefours product be unique and different from the existing products in the market. mostly sells consumer goods and services

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(CG Home theatre system very unique and different from other Home theatre at market). The product has sales in needed and wanted by the consumers. (Carrefour arrange different product in festival seasons such as Hari Raya, Chinese New Year, Deepavali and Christmas. Example: Lucky Bamboo, cai Shen scoll, honey mandarin and assorted paper card - in Chinese New Year and Christmas table, Christmas trees and colourful lights in Christmas.) The product have high consumer demand and a high growth rate. ( all kind of product). The product has to be reasonably priced and affordable to the majority of consumer. ( all kind of product). The Carrefour have sufficient funds to build consumer awareness and carry on other promotional activities. ( Carrefour Gift Vouchers, Carrefour Bonus ) .

Analysis on type of product

Carrefour Home Products Products designed to completely furnish a house, with each style of product found in general merchandise, consumer electronics, and apparel, with a permanent range supplemented by seasonal ranges. For examples, wardrobe, electronic devices such as Home theatre, automatic washer, vacuum cleaner, Digital jar rice cooker and etc. Differentiation strategies on Carrefour Home Products are based on product differentiation.

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Form The products design different from other products, example GC product. Quality Carrefour always guarantee that all products they sales are safety and good quality.

Brand

At Carrefour they sales CG brand products, which one mostly unique and different from other brand products at market. Besides Carrefour also sales other product such as TOSHIBA, PENSONIC, ELBA, FABER, SAMSUNG, SHARP, LG, Goldsonic and etc. Durability A product that can last for many years is perceived as a product of good quality. Features CG products have various attractive features such as CG television set with loud stereo sound, clear picture quality , remote control and a big screen falls into the good quality product category.

Carrefour Fresh Food Carrefour also offer fresh food to consumers which one given the opportunity to consumer to make many choices, an opportunity which has so far been lacking

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in Malaysia Carrefour. In terms of fresh produce, choice also pervades. Pursuing the unconventional, for example, Carrefour will carry those items that other stores shy away from: at Carrefour one can find curved cucumbers, freshly harvested cabbage (ones that have not gone through any additional processes), and other items that suffer from no real, discernible defect in quality. Besides Carrefour also carry fresh food like fresh chicken, fresh fish, fresh Australia Beef, fresh prawn and etc. Differentiation differentiation. strategies on Carrefour Fresh Food are based on product

Quality The "Quality Way" products are the result of the collaboration between Carrefour and chosen producers, who have committed themselves to strictly follow a quality letter statutes agreement. The aim of the collaboration is to provide consumers with healthy and safe products. The products certified with the "Quality Way" sign are quality and safety guaranteed, from the first production stage until the final positioning on the shelves. Some fresh food in Carrefour certificated as "Quality Way" are :
y y y y y y y y y y y y

"Halvah quality way", "Chicken quality way", "Free Range Eggs quality way", "Fresh Fish tsipoura quality way", French beef, Salmon, Biological bread, "Barrel Feta quality way", "Pork quality way", "Apples agorin quality way", "Peaches and Nectarines Veria quality way", "Seabass quality way",

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y y

"Kiwi quality way, Feta Tin quality way

Based on services differentiation. Carrefour also provide customer service such as Cutting Service (Scalling / Cutting service for meat products upon request).

Carrefour Family Goods. Carrefour also carry family Goods such as Carrefour Baby Goods (Food range, hygiene, perfumery, childcare products, toys, apparel developed under the advice of a committee of pediatricians and specialists, in order to guarantee the babys development from 0 to 36 months with security and comfort.), Carrefour Kids Goods ( Food range, general merchandise, apparel, designed to develop good habits (fight against obesity with less fats, sugar and salt), as well as developing autonomy, satisfying the tastes of children between 4 and 10 years old through adapted packaging and the use of the mascot: Genius), Mens clothes, Ladys clothes (variety of clothes) and etc.

Differentiation strategies on differentiation. Quality

Carrefour Family

Goods are based on product

Carrefour always guarantee that family goods

they sales are safety and good

quality specially Babys Goods. To guarantee the quality of its products and its own brand and banner brand products, Carrefour systematically conducts audits on its suppliers production sites, which are audited health and safety conditions.. Suppliers are audited with respect to health and safety conditions, risk control, traceability and compliance with specifications.

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Based on services differentiation. Carrefour also provide customer service such as:  Free Delivery Service Free delivery for selected items within 30km radius of our stores.  Textiles Alteration Service Hemming alteration for Carrefour customers.  Wrapping Service

price positioning strategies One of Carrefour's most distinct characteristics is its low - price strategy by dealing directly with manufacturers that allows it to undercut rivals by 20 - 50%. Although negotiations with manufacturers ran into some difficulties and the percentage of directly negotiated goods sold at the Carrefour store reached only 55%, it is still a figure that has not yet been attained by any other retailer. Stimulated by low prices, stores have found effective and inventive tools to drive the sales momentum. Below table of price positioning strategies.

P/Q

Higher Price

Lower Price

Higher Quality

Premium Strategy

Good Value Strategy

Lower Quality

Overcharging Strategy

Economy Strategy

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The good value strategy is a way to attack the premium pricer, i.e. " Carrefour have high quality, but at a lower price." If true, and if the quality - sensitive segment believes the good value pricer, they will sensibly buy the product and save money -- unless the premium product offers more status or "badge value" (snob appeal). Carrefour presenting lower prices for their product offerings. Besides, Carrefour avoid offer their products at Premium Strategy, Overcharging Strategy and Economy Strategy.

Carrefour Home Products

In this type product Carrefour follow good value strategy. For those think this type product very expensive in Carrefour can get money back from Carrefour but need follow Terms & Conditions. The services offered by Carrefour is Lowest Price Guaranteed Or Twice Your Money Back! (Carrefour will give two times the price difference if consumer ever find any item they have purchased at Carrefour being sold cheaper elsewhere.) Carrefour Fresh Food At Carrefour low price does not mean low quality. Quality is one element which is never compromised in their quest to provide the best deals for consumer. Their value for money Brand Values & Assurance gives you the assurance that the entire range of Carrefours competitively priced product range has withstood the stringent quality control standards developed by Carrefour. So that fresh food at Carrefour also have Higher Quality with Lower Price. Carrefour Family Goods

At this product

also

Carrefour offer low price

with high quality and services

given by Carrefour are ; "Consumer will still get a refund from Carrefour even if they changed my mind or made a wrong purchase" (If consumer are not happy with their purchases or bought the wrong item, simply return it to Carrefour. They'll refund 100% of consumer money. No questions will be asked!).

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Distribution Channel

The Carrefour as a whole is an efficient channel of distribution: it is a whole set of marketing intermediaries that have joined together to transport and store goods from producers to consumers. The Carrefour acts as a wholesaler as the Group sells products to franchises. All the retail stores are other intermediaries. Some of the producers are local while other goods are bought by bulk purchases or global sourcing. That means that Carrefour has to organize the whole transportation to its retail stores. Carrefour is mainly concerned with outbound logistics as they manage flows of finished products to ultimate customers (and to business buyers for cash & carry). This is a critical activity for Carrefour: they just cannot have empty shelves because that would not make customers happy! Each day, 8 trucks are needed to deliver products to one hypermarket! They use sophisticated software to create an efficient link between sales and purchases. They use push pull - push logistics. It means that they both do forecasts and they also control what is sold in order to adapt. Before the merger Carrefour Promods, both firms had their own channels of distribution. After the merger, they decided to organize a common and efficient channel of distribution. It can be divided into three networks: grocery products which stay a very short time in warehouses for

hypermarkets the same products for supermarkets, convenience stores and Promocash

products which stay a bit longer in warehouses, and that are delivered to all formats of stores

This new system enables to reduce the distance over which the products are transported (thus reducing the cost), and also shortens the time for the delivery. Moreover, with the multidrop system, only one truck is used to transport products from a manufacturer to two close warehouses. Carrefour owns many huge logistics platforms (also called distribution warehouses). They gather

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products from different manufacturers (which are suppliers for Carrefour), and redistribute these products to the different stores when they need them. They have introduced technological tools: those who prepare orders are helped by a vocal recognition tool, in order to avoid any mistakes. Manufacturers used to store finished goods in their own warehouse, and then, the goods were transferred to Carrefour warehouses. Carrefour now wants to transport directly the finished goods from the manufacturers to Carrefour warehouses.

Marketing mix The marketing mix looks at the four main factors that go into a marketing program (Product , Price , Place , Promotion ) , which are referred to as the 4 Ps.

PRODUCT The Carrefour needs to design their stores so that they meet customers need. This includes having the right store format , helpful services , the appropriate product mix , and a reliable private label brand. Carrefour have adapted the kinds of products they sell to the local culture. For instance , Chinese people do not always have a huge refrigerator , so they appreciate fresh products. Thus , Carrefour , by guaranteeing both prices and quality for lots of fresh products has a real advantage : it is much easier and practical to buy fresh goods. Moreover , in Carrefour , they also sell western products for the western people living here . This market segment needs were not yet fulfilled, as western products are not sold elsewhere. In Carrefour Malaysia, people can buy such goods as chocolates, wine, and even cheese or cookies just like in France. The group also adapted its services to local shopping habits. For instance, in Malaysia , people often drive to hypermarkets , only once a week. They buy everything they need for the week, and a car is very useful to transport the goods back home. That is why big parking lots are needed.

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Although the Carrefour sells a lot of goods with a manufacturer brand names (such as Danone , Yoplai t or Nestl ), they also sell dealer (private - label) brands: Carrefour (in Carrefour hypermarkets) , Champion ( in Champion supermarkets ) and Grand Jury ( in convenience stores ). Thus, these products do not carry the manufacturers name. The Carrefour product range now includes 11,000 mass-market products and miscellaneous household goods. They have paid a special attention to the packaging so that the brand is immediately recognizable . It has a special colour code , displays the Carrefours quality commitment, complete labelling information and a display of the Carrefours satisfaction or consumer money back policy. In order to improve these brands equity, they use widely recognized labels to promote trust among customers. The brand loyalty is very high. The Carrefour brand is the best - selling brand in Carrefour hypermarkets, representing 25% of the total sales. Nine out of 10 customers fill their shopping carts with Carrefour brand products.

PRICE This is a very important P in Carrefours strategy, they even talk of the price image of the group. The objective of the Carrefour is to reduce prices in all formats of stores. In 2005, the clearly stated objective of each hypermarket was to be the least expensive store within its market radius. This is a competition - based pricing, their strategy is based on what other competitors are doing (including hard discounters and informal traders), and the Carrefour tries to set the price below the competitors. However, they also seem to have a demand - based (or target) pricing as they constantly try to reduce prices to meet or exceed customers expectations, even though they are already under their competitors price. The objective of this price reduction strategy is to attract more people to the stores, thus gaining market

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shares. The objective can be explained as a virtuous circle: the more they sell, the more economies of scale they can do, the more they can lower prices thus attracting more customers. The Carrefour has reduced the necessary time to analyze the research data and to adjust price displays in each department to 24 to 72 hours maximum. They pay a particular attention to the pricing of sensitive categories of products (those that the customers notice). They have also studied what factors contributed to this image. The main ones are fresh product price competitiveness, reliability and quality of the price indications, price competitiveness of the private label range.

PLACE This P is about putting the product in a place where people will buy it. The Carrefour adds value to goods or services by different means. Form utility. to The make fresh bakery department bread and in hypermarkets on the uses spot. various Other

ingredients utility.

croissants,

baguettes

departments such as the butchers and the fish department also perform form

Time utility. In order to make products available when they are needed, the Carrefour has developed a new format according to consumer needs and wants. Place utility. In order to sell products where people want them, the Carrefour has different store formats. For instance, in Malaysia , hypermarkets are in town suburbs easily accessible by cars. Possession utility. The group provides credit. With the PASS Card, customers can spread out their payments and make their purchases on credit. The Carrefour also helps to take a loan to buy a car for example. When you buy big goods, hypermarkets can deliver them to you.

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PROMOTION

Promotion is the effort to inform and remind people in the market about products on sale in the stores, and to persuade them to buy. Carrefour uses various tools (advertising, public relations, sales promotion) which altogether are called the promotion mix. It is worth noticing that as other big retailers, they do not use personal selling.

Advertising

Carrefour slogan (Lebih Jimat, Lebih Hemat ) is probably one of the best known among Malaysian people. It is quite simple to remember. It just means that with Carrefour, can be very optimistic as everything is so great in these hypermarkets. As they target the local market, it is highly efficient as people see the billboards many times. Time to time, they use other medias such as the TV to promote nation wide events. Public relations In order to inform the public of the changes that are being made by Carrefour, and to show how this is a good thing to customers, Carrefour has a very efficient information programme. Moreover, as Carrefour is one of the biggest firms, there are many newspaper articles about the Carrefour. Overall, these publications are a good publicity for the Carrefour. Sales Promotion Sales promotion is the promotional tool that stimulates consumer purchasing and dealer interest by means of short - term activities. Carrefour Hypermarkets regularly send catalogues to all households that live nearby. In each hypermarket,

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they have a reserved zone where they make special displays to present new products. There are also reduction coupons for those who have the loyalty card Carrefour. They can have reductions of 20% on most popular products. Special events are organized each time they open a store. They also use bonuses (buy one, get one free), especially one they want to get rid of their stock

Marketing management strategies 1. Using Technology To Manage Information The development of technologies has been very important for the

development of Carrefour. The main technology that has been useful is the computer, and then the Internet. The Internet, for example, allowed Carrefour to develop new kinds of activities like the online supermarket. But the most important point with the Internet is the creation of a B2B extranet. Suppliers can manage their relations with Carrefour more easily and more efficiently. The development of computers has been very useful for logistics reasons too. Faster computers can generate more accurate delivery schedules, for example, and thus reduce significantly the costs. The use of servers has also allowed developing giant databases of customers. And these databases are very important in the strategy of Carrefour. Carrefour keeps information for each customer that has a loyalty card, and whichever shop are going to consumer are known and can use the advantages of their loyalty card (for example, for which all the shops are separated). Finally, Carrefour created a website for recruitment purposes, so that people can easily access to work offers and have information about them, no need to browse lot of time to find a simple information.

2. Increasing purchasing power The overall trend of the distribution sector in the world is mergers and acquisitions. The global market for distribution companies is very competitive because customers are always looking for the cheapest products for everyday live purchases. For most formats of retailers, the market can best be described

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as an oligopoly, as only a few sellers dominate the market. The only exception may be for district shops which could have been described as a perfect competition, as there were many different brands. However, even this market tends to be an oligopoly nowadays. So, Carrefour needs to make SWOT analysis to increasing purchasing power. Almost everyone would agree on a simple statement that prices never go down. If that were the complete truth, purchasing power would have a hard time moving up. Decreasing purchasing power is also a classic reason for players to cut prices. Carrefour must see the market place by place, by demographic, geographic, and psychographic to be first retailer in Malaysia.

iv) Wal- Mart Stores, Inc. and Carrefours SWOT analysis

Mart Stores, Inc. is an American public corporation that runs a chain of large, discount department stores. It is the world's largest public corporation by revenue, according to the 2007 Fortune Global 500. Founded by Sam Walton in 1962, it was incorporated on October 31, 1969, and listed on the New York Stock Exchange in 1972. It is the largest private employer in the world and the fourth largest utility or commercial employer, trailing the Chinese army, the British National Health Service, and the Indian Railways. Wal-Mart is the largest grocery retailer in the United States, with an estimated 20% of the retail grocery and consumables business, as well as the largest toy seller in the U.S., with an estimated 22% share of the toy market. Wal-Mart operates in Mexico as Walmex, in the UK as ASDA, and in Japan as Seiyu. It has wholly - owned operations in Argentina, Brazil, Canada, Puerto Rico, and the UK. Wal-Mart's investments outside North America have had mixed results: its operations in South America and China are highly successful, but it sold its retail operations in South Korea and Germany in 2006 after sustained losses.

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Wal-Mart has been criticized by some community groups, women's rights groups, grassroots organizations, and labor unions, specifically for its extensive foreign product sourcing, low rates of employee health insurance enrollment, resistance to union representation, and alleged sexism.

Wal-Mart Stores Strengths The slogan, "Save Money Live Better," replacing the "Always Low Prices, Always" slogan, which it had increase purchasing power. Wal-Mart's goal was to be a "good steward for the environment" and ultimately use only renewable energy sources and produce zero waste. Sell products at prices lower than those asked by traditional retail outlets. Wal-Mart is a powerful retail brand. It has a reputation for value for money, convenience and a wide range of products all in one store. Wal-Mart has grown substantially over recent years, and has experienced global expansion (for example its purchase of the United Kingdom based retailer ASDA). The company has a core competence involving its use of information technology to support its international logistics system. For example, it can see how individual products are performing country wide, store-by store at a glance. IT also supports Wal-Marts efficient procurement. A focused strategy is in place for human resource management and development. People are key to Wal-Marts business and it invests time and money in training people, and retaining a developing them.

 

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Carrefour is the second largest retail group in the world in terms of revenue and sales figures after Wal-Mart, and the first in Europe. Wal-Mart is one competitor of Carrefour in the world, so that Carrefour in Malaysia need to improve market positioning and make SWOT analysis as well before Walmart operate in Malaysia.

SWOT analysis

Strengths  Carrefour Offer low price with high quality products.

Providing their customers with freedom of choice.

Guaranteeing food products safety and quality.

Fully

assume

the

consequences

of

their actions

on

customers, their

company and staff, institutions and the environment.

Respect their staff, suppliers and customers.

Give more services to consumer such as Extended Warranty, Easy Payment Scheme, 0% Interest Free, Free Delivery Service, Textiles Alteration Service, Wrapping Service, Cutting Service, Handicap Friendly Store Facilities, Automated Teller Machines, Food Court, Surau / Moslem Prayer Room, Baby Changing Rooms, Taxi Stand and Bus stand. Have good working conditions, and good health care.

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Offering excellent value for the customers money, the Carrefour s own brands met with undeniable success, attracting an ever more demanding clientele.

Weaknesses   Carrefour always located at town side. (people stay at out of town need to make long travel to purchasing in Carrefour).

Opportunity New locations and store types offer Carrefour opportunities to exploit market development.

Carrefour will provide

new services in Malaysia as soon such as in

France. The services are self check - out system which offers customers the option of scanning their purchases themselves, paying for them at automatic checkout facilities and then bagging them themselves. Threats  Being second retailer means that they are target competition, locally and globally. Being a global retailer means that they are exposed to political problems in the countries that they operate in.

Carrefour can make repositioning strategies to reduce the impact of the competition. Repositioning may be required to change consumer's perception of a brand relative to competing brands. For example, if Carrefour consider that a certain product to be high in fat and sugar, then that Carrefour manufacturer need seek to reposition the product by modifying the product to be lower in fat

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and

sugar,

and

then communicating

the

lower

fat

and

sugar

content

to

consumers. Sometimes consumers have misperceptions about the brand or do not adequately value a particular product attribute. The Carrefour can seek to change consumer's attitudes through promotional activities that educate the consumer on the product's attributes and benefits. The Carrefours need to attract the greatest possible number of people to their retail stores. As different market segments have different needs, they need to have different formats of retail shops to fulfill these needs. For instance, elderly person often do not have a car and live alone, so they need a store near their house, they need district shops. However, large families with children are looking for hypermarkets where they can buy goods at a cheap price, just once a week. So that Carrefour need deploying an ongoing and aggressive lowprice policy by expanding its in store promotions and communications.

Besides Carrefour need to: Making the brand work harder will help Carrefour grow sales and profits in Malaysia. Offer a more diversified product mix than traditional with hard discount. Strengthen environmentally conscious product and packaging design and develop a range of products with social and environmental added - value. Ensure product safety and quality, and customer and and employee safety at our store locations. Guarantee respect for human rights internally and along their products' supply chain.

 

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Promote staff training and development, and inform staff of their view of the world, and their core values, their policies and their approach to sustainability. Respect customers' freedom of choice by offering them a wide range of products at attractive prices with full, factual information.

References

1.

Euromonitor 1995: World Retail Directory and Sourcebook. (1995). London, Great Britain: Euromonitor plc.

2. Anonymous. 1995h. (UBS Research Limited, March 29, 2995). CarrefourCompany Report. In Investext [Database on CD-ROM]. Distributed by Information Access, Foster City, CA. 1995.

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3. Anonymous. 1995g. (Salomon Brothers, Inc., October 11, 1995). Wal-Mart Company Report. In Investext [Database on CD-ROM]. Distributed by Information Access, Foster City, CA. 1995.

4. Anonymous. 1995h. (UBS Research Limited, March 29, 2995). CarrefourCompany Report. In Investext [Database on CD-ROM]. Distributed by Information Access, Foster City, CA. 1995.

Websites 1. Carrefour Malaysia. (online). Available: www.Carrefour.com.my 2. Carrefour Group. (online). Available: www.Carrefour.com 3. Wal-mart store inc. (online). Available: www.Wal-mart.com

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