Subject category:
Strategy and General Management
Published by:
IBS Center for Management Research
Length: 20 pages
Data source: Published sources
Topics:
Carrefour; Retail industry in South Korea; Economies of scale; Globalisation; Localisation; International business; International expansion; Entry strategies; Expansion strategies; Global supply chain management; Store formats; E.Land; Hypermarkets; Joint venture; Store layout and ambience; South Korean economy
Abstract
The case describes Carrefour's entry and expansion strategies into the South Korean market and the reasons that led to its exit from the country. The company failed to localise its stores, and the products sold, according to the needs and preferences of Korean consumers. Carrefour chose to venture into the Korean market on its own, without a local partner, due to which it failed to understand the market and was unable to select good locations for its stores. The company employed most of its top management personnel from France, which was not viewed favourably by local employees, so too often Carrefour faced problems from local labour unions. After a decade of unsustainable operations and cut-throat competition, Carrefour finally announced the sale of its South Korean business in April 2006.
Teaching and learning
This item is suitable for postgraduate courses.About
Abstract
The case describes Carrefour's entry and expansion strategies into the South Korean market and the reasons that led to its exit from the country. The company failed to localise its stores, and the products sold, according to the needs and preferences of Korean consumers. Carrefour chose to venture into the Korean market on its own, without a local partner, due to which it failed to understand the market and was unable to select good locations for its stores. The company employed most of its top management personnel from France, which was not viewed favourably by local employees, so too often Carrefour faced problems from local labour unions. After a decade of unsustainable operations and cut-throat competition, Carrefour finally announced the sale of its South Korean business in April 2006.