Carrefour to Shrink, Not Sell, Its Suburban Big-Box Stores
(Bloomberg) -- Carrefour SA said it would deepen cost-cutting measures and reduce its store sales space as the French retailer adapts to the rise of e-commerce.
- The company plans to reduce store space by around 10 percent of its current hypermarket portfolio and pledged to trim annual costs by 2.8 billion euros ($3.2 billion) by 2020, versus 2 billion euros in a previous plan.
- Carrefour is getting more aggressive about scaling back suburban stores that have struggled to cope with competition from e-commerce and specialty retailers. While shrinking so-called hypermarkets, it’s opening 3,000 more convenience stores.
- The retailer is sticking to its guns on Chief Executive Officer Alexandre Bompard’s plan to increase sales of organic groceries to 5 billion euros by 2022 from 1.8 billion euros last year.
- Rather than closing hypermarkets -- politically sensitive in France, with “yellow vest” marchers in the streets -- Bompard said he wants to overhaul them.
- Carrefour shares rose as much as 3 percent in early Paris trading. They were down 7.4 percent over the past year at Wednesday’s close, compared with a decline of 0.3 percent for rival Casino Guichard-Perrachon SA.
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