Two of the world’s largest grocers, Carrefour and Tesco, have declared the “age of imperialism” in global retail expansion over and urged retailers to localise their offer.
Carrefour chairman and chief executive Georges Plassat told delegates at the World Retail Congress in Paris “it is essential to be integrated locally”.
Under Plassat, French giant Carrefour has retrenched its operations to focus on growth in Europe, South America, China and Taiwan.
He said: “Imperialism has ended although people still want western products.
“International globalisation is very expensive. When you go into lots of markets at the same time you are never able to dominate the accumulation of competitors you are facing.”
But Plassat said Carrefour would still target growth in the Asia Pacific region, where there had been speculation of a sale of its operations earlier this year. “We have to stay there,” he said. “We have to put anchors wherever we can, [and] understand local people.”
SH Lee, chairman of Tesco’s Korean Homeplus business, said it is important for global businesses to tailor their offer.
He said: “There are many imperialists in the Korean market who fold as they did not understand the local culture. That’s where location is important even in the digital era.”
Lee said that Tesco had helped propel the business from the 12th to the 2nd largest in Korea.
Tesco, too, has retrenched it’s global business, scaling back its international arm including shelving operations in Japan and the US to focus on its core UK arm.
Plassat also told delegates that the hypermarket is “not dead”, despite UK peers including Tesco putting the brakes on hypermarket expansion. Plassat added that “clicks and mortar are the future”.
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