Wednesday, January 09, 2008

Carrefour speeds up expansion

Carrefour speeds up expansion

Smaller store formats will be in spotlight


With an optimistic view of the stability of the country's economy and politics, the Carrefour hypermarket chain plans to triple its investment budget to three billion baht this year to open six or seven new branches, double the number it had planned originally.

''When the country has a government that comes from an election, it helps increase foreign confidence and attracts more investors to Thailand. So, we are confident that the country's economy will be better than last year,'' said Segsarn Trai-Ukos, the business development manager of CenCar Co, the local Carrefour operator.

The government has forecast that private investment this year will increase by 5-6%, compared to 0.5% last year.

Mr Segsarn said that last year the company opened three new branches: in Chon Buri, Rama II in Bangkok and Khlong Sam, Pathum Thani. The Rama II store, a smaller format with 4,000 square metres, opened opposite rival Tesco Lotus at the end of last year.

CenCar Marketing director Prapaphan Ploysaengngam joins children at a Carrefour branch to promote the chain's Disney product line.

This year Carrefour plans to add six or seven new branches, both conventional and various compact formats, but mainly around the 4,000 sq m size. All of the new outlets will be modelled on the Chon Buri branch, its first ''premium'' prototype store format.

The addition of more compact outlets will help the company speed up its expansion and increase consumer access to its stores.

Apart from new stores, the company plans to spend at least 240 million baht to renovate its 24 existing stores and make them ''premium hypermarkets'' by the middle of this year, starting with the Rama IV, Phetkasem, Bang Yai, Ratchada and Pattaya branches. The merchandise mix will be adjusted, increasing the proportion of non-food and home decoration items and adding new anchors such as Boots personal-care stores.

Marketing director Prapaphan Ploysaengngam said the company would also join with Fun Characters International (Thailand) Co Ltd, the local licensee for Disney consumer products, to co-develop Disney merchandise to sell at all 27 Carrefour outlets this year.

''When think about children's apparel, Disney is among the first choices for children. So, to expand to new families with children, Carrefour is teaming up with Disney globally to provide Disney items to Disney fans,'' said Ms Prapaphan.

Since the company dealt directly with garment makers, the prices of Disney items at Carrefour would be affordable and tailor-made for each location.

Carrefour last year began a loyalty programme allowing customers to redeem coupons for Disney cartoon character items for every 500-baht purchase. redemptions to date have totalled 150,000 items, 20,000 higher than projections.

To continue the sales momentum, Carrefour has spent five million baht for a new rewards programme called ''Carrefour I Wish to Fly''. For every 500-baht purchase, customers can enter a draw for a Hong Kong Disneyland trip. It is also staging a Disney Bazaar showcasing 200 Disney items until Jan 30.

Anitita Buasub, the country manager of Fun Characters International (Thailand) Co, said sales of Disney items available in Thailand were about three billion baht last year. For consumer products alone, sales are expected to rise by 17% from last year.

She did not disclose sales figures but said the market would be spurred by the introduction of more Disney food, electrical and toy products, cartoon tie-ins from new movies, and the addition of more business partners.

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