The retail industry is today a huge market where competitors are a lot. In order to overview the market of the retail industry, we will list the main actors in the world: Wal-Mart, Carrefour, Ahold, Kroger, Metro group, Target, Albertsons, Kmart and Tesco. However in order to seize more deeply the question about "Key success factors in the retail industry" we will have to define what is a retail industry in its first meaning.
Retailers purchase items from a supplier or wholesaler for re-sale at a profit. The retailer earns his living by making a profit on the re-sale. To do this the retailer may offer only one type of product, where there is little competition, and use a substantial markup (such as an auto dealership), or the retailer may offer many different products or models, so customers will be certain to find an item to buy in this store and not in a competitor's store (such as a convenience store). Some retailers earn a small profit on many items and rely on the volume of sales (such as grocery stores), or turnover, to account for their profits.
[...] As we just explain, Wal-Mart has 3 different formats for their stores. These formats differ from traditional ones so we will explain them: • Supercenter: It is the most important format for Wal-Mart stores. It is a combination of general retail with groceries. The aim is to attract customers who want to buy retail products and attract them to other products for increase their purchase. • Wholesale: The items are on pallets and in big quantities. To be client of this warehouse format, clients have to become membership. [...]
[...] But in order to succeed, Carrefour and Wal-Mart have adapted their store to Chinese customer's lifestyles. Many stores offer fresh food like live river fish, eels and turtles that are slaughtered right on the spot or in aquarium. Both offer a large range of Chinese products. They also, create many new things: Supervised playground for children at a nominal cost next to toy and book section, Wal-Mart cosmetics counter for fashion addicts. Moreover, Carrefour opted for two-level stores over a single level "and— catering to China's relative shortage of automobiles—allocated a large share of its parking lots for bicycles and even provided a bus to pick up shoppers." Local companies encounter many problems: they need managerial talent, financing and greater scale, lack of qualified manager. [...]
[...] Budget, review and control all costs In the retail industry control all costs is really important, that is why companies like Wal-Mart and Carrefour succeed. For example, when a Carrefour Store in China look likes a discount store no decoration at all, not well organized, the only place where everything is perfect is the place where they sell wine because it's a very high quality product with a great image. Moreover, they used to pay their suppliers within 30 days even more depends on the country which is a big advantage in this business. [...]
[...] In general, higher average income and increased product choice have enabled Mainland consumers to become choosier. Urban consumers now buy more expensive cuts of meat, fresher seafood, organic vegetables, and food products with health benefits. Mainland consumers also demand more diverse foods. They are broadening their diets to include poultry, eggs, dairy products, fish and refined vegetable oils. Quality food and branded food products are also gaining popularity, especially after the frequent exposure of food scandals. This is particularly true for babies and children foods. [...]
[...] Carrefour is present in 29 countries and has stores with 410000 employees (Europe, Middle-East, Latin America, Asia) and 49% of revenues come from outside France In order to demonstrate the key success factors in the retail industry, we will list reasons which justify the success in the retail industry. Then we will explain how Wal-Mart and Carrefour handled formats and locations. Finally we will analyze competitive advantages in China and Japan. Key success factors In the first part, we will explain the key success factors of Wal-Mart and Carrefour. Procurement Capacity They are among the largest retailers in world. They buy products around the world according to the price because they buy high volume. [...]
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