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Case
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Reference no. 306-506-1
Authors: Ashok Som; Yunju Sung
Published by: ESSEC Business School
Originally published in: 2006
Version: 1 Aug 2007

Abstract

In the Spring of 2006, Carrefour Korea stands at a crossroads of making a critical business decision, whether to withdraw or to continue, after its 10-year-operation in the Korean retail market. Since launching the first outlet in Korea in 1996, Carrefour Korea had continually recorded annual net gains and growth in sales. With accumulated investment of over 15 billion euros over the last 10 years, Carrefour''s foreign direct investment (FDI) was the single largest in the Korean market. However, the results of Carrefour Korea''s performance fell short of expectations that the French headquarters had decided. This case analyses Carrefour Korea''s failure by observing: (1) the market condition of Korean discount retail industry; (2) the market economies of local competitors; (3) the process of Carrefour Korea''s localisation; and finally (4) the business strategies of each competitor in this near-saturated market.
Location:
Industry:
Size:
Second-largest retail giant
Other setting(s):
2006

About

Abstract

In the Spring of 2006, Carrefour Korea stands at a crossroads of making a critical business decision, whether to withdraw or to continue, after its 10-year-operation in the Korean retail market. Since launching the first outlet in Korea in 1996, Carrefour Korea had continually recorded annual net gains and growth in sales. With accumulated investment of over 15 billion euros over the last 10 years, Carrefour''s foreign direct investment (FDI) was the single largest in the Korean market. However, the results of Carrefour Korea''s performance fell short of expectations that the French headquarters had decided. This case analyses Carrefour Korea''s failure by observing: (1) the market condition of Korean discount retail industry; (2) the market economies of local competitors; (3) the process of Carrefour Korea''s localisation; and finally (4) the business strategies of each competitor in this near-saturated market.

Settings

Location:
Industry:
Size:
Second-largest retail giant
Other setting(s):
2006

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