Last week, the world’s second largest retailer, Carrefour, posted its third-quarter results.

Total sales, including VAT and excluding petrol at constant exchange rates, increased a modest 1.8%, largely driven by its Latin American arm.

Although France showed a little improvement, this was largely wiped out by a subdued performance in southern Europe.

Carrefour is particularly exposed to the recessionary environment across Europe because of the structure of its business – the majority of sales come from hypermarkets where non-food makes up a big part of the product range.

This is evident in the figures released for France. While hypermarket sales fell 3.4% excluding petrol, supermarkets and convenience formats posted rises of 1.1% and 3.8% respectively.

That said, Carrefour has been seeking to reduce its dependence on non-food in hypermarkets by making stores more food focused and rationalising non-food ranges.

If Carrefour is to improve its performance in Europe it will need to concentrate expansion on smaller formats. It is already making progress on this, opening 40 new convenience stores in France during the quarter. We expect further openings here.

Nevertheless, Carrefour will also need to address the online market if it is to turn around its fortunes in Europe. Progress is being made with the addition of 39 Drive stores in France during the quarter – totalling 164 at the close.

Perhaps more importantly, it is also beginning to address the growth of m-commerce. Carrefour has already introduced a mobile shopping app and recently took a step further and began testing mobile shopping walls at train stations.

Although still in its infancy, such technology is becoming more widely used. Both Ocado and Tesco in the UK have piloted such technology, as has US giant Walmart.

While these initiatives are good at raising awareness of retailers’ m-commerce capabilities, they have their limitations. For one, shopping walls can only highlight a limited selection of products.

The second limitation is they are only suitable for a limited number of high footfall locations such as train stations, airports or shopping centres.

If Carrefour is to turn its business around it will need to combine all these measures, embracing ecommerce, m-commerce and convenience to reduce its dependence on the troubled hypermarket format.

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