The world’s second largest retailer, the 97.24 billion euro France-based Carrefour, will be entering the Indian retail market via the franchisee route, with its hypermarket format in mid-2009. The first such store would come up in northern India, with an average sales area of 50,000 square feet. Hypermarkets constitute 58% of the retail giant’s worldwide revenues. The company has franchise models in Dubai, France, Belgium, and Spain.
Carrefour, which operates five formats across the globe, decided to foray with the hypermarket, since this is one segment almost absent in the Indian retail market, which is dominated by convenience stores and supermarkets.
Carrefour is talking to three Indian corporate houses for the franchisee agreement, and expects to finalise it by the first quarter of next year. “The first store would come up in northern India,” Carrefour India managing director, Herve Clec’h told FE. The retail giant operates 1040 hypermarkets across the world with an average sales area of 90,000 square feet. “We are presently speaking to three Indian corporates – a financial institution, a retailer, and a conglomerate, and should announce our partner by early next year”, Gerard Freiszmuth, general manager Carrefour India said.
Apart from front-end franchisee stores, the French retailer will also be entering the cash and carry, wholesale segment, but unlike the world’s largest retailer, Wal-Mart, which tied up with Bharti Retail, it will not tie-up with an Indian corporate for this format since, Clec’h said, 100% FDI was allowed in this segment. Thus, Carrefour would be operating two companies in India; Carrefour India Master Franchise Company Pvt Ltd and Carrefour WC&C India Pvt Ltd, for retail and wholesale operations respectively, apart from its sourcing division.