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Carrefour will not open its first branch in Dizengoff Square - Walla! Of money

2022-04-24T12:15:18.701Z


The French retail giant will not open its first branch in the heart of Tel Aviv, but the equally intriguing question of where, is when - and will the Israelis embrace it?


Carrefour will not open its first branch in Dizengoff Square

The French retail giant has not yet opened a single branch in Israel and is already succeeding in stirring up the industry.

It will not open its first branch in the most central location in Tel Aviv, but it seems that the question is not only where, but especially when.

Industry insiders are trying to assess the network's chances of success and lower the cost of living

Liat Ron

24/04/2022

Sunday, 24 April 2022, 14:32 Updated: 15:00

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Contrary to various publications that have surfaced in the media, the first Carpur branch in Israel will not open in Dizengoff Square in Tel Aviv, moreover - it has not yet been decided whether the flagship branch will be located in Tel Aviv at all, as the intention is to open a large branch with convenient access and parking spaces. To the discount branches we know from the industrial areas outside the city centers.



But with all due respect to the location, the question is not only where will the first Karpur fencing open in Israel, but when.

At least for now, it seems that contrary to the optimistic forecasts of "Electra Consumer", which signed a 20-year Carpourt franchise agreement in Israel - and announced that the first branch in the country will be launched by the end of 2022 - in practice it is not certain Those who think she will even precede him.

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Representatives of Electra from Israel and Kapoor from France at the signing of the franchise agreement (Photo: PR)

"Prices are tens of percent lower"

About three weeks ago, the franchise agreement was signed between Electra Consumer and the French Carrefour, which is considered the big bang of the Israeli retail market, with the intention of turning the Bitan Wines and Mega branches into the branches of the French retail chain.



"Every store that opens will shock competitors in the same area," said Amit

Zeev

, CEO of Bitan Wines and

who is supposed to head the chain in Israel. "We will bring a completely different experience and quality than what has accustomed the Israeli consumer to date."



Not only a huge variety, but also low prices: "The variety in the country is limited, because we are used to those 10,000 products.

Carrefour has 20-25 thousand products.

This means we will offer double and more variety.

The chocolate department in supermarkets in Israel offers dozens of chocolates - in Carrefour we offer hundreds, and so will we.

Amit Zeev, CEO of Bitan Wines. The man who is supposed to head the French retail giant in Israel (Photo: Tal Flint)

"Convert" the private label

Factors in the food industry (who have an interest in the industry) do not buy the cheap price promises and especially the speed of opening the branches - converting 150 Beitan and Mega wine branches and replacing them with Carrefour branches for three years, at a weekly rate.

"This move is much more complex than it was presented," says an industry source.



"At best, it will take three to five years for the first branch to open here. To 'convert' the private label is not a simple matter, of course there are thousands of them.



" Anyone who thinks he can buy Carrefour cola, Brilla or international brands at cheap prices is wrong.

Carrefour does not have a uniform price policy in all branches of these brands, they do not interest them and therefore each franchisee closes the price with its suppliers, so that the purchasing power of the chain, which is considered the largest in Europe, is not reflected.

Only the private label, where Carrefour is very strong, has uniform pricing in all the branches in the world and is really cheap. "

It all depends on how quickly they will be able to train the private label items in accordance with the rabbinate's requirements, and of course - design the branches in accordance with the chain's requirements (Photo: PR)

Carrefour Global CEO is personally involved

Other industry insiders claim the opposite.

According to them, not only is the international "Carpor" committed to the opening goals that it itself reported to the stock exchange, the CEO of Carpor is personally involved in the project in Israel and provides Electra with all the resources to not only meet the goals, but even precede them



. It should be taken into account that Electra has a real estate arm that can help expedite the renovation and improvement of the branches and thereby significantly shorten the time until their full conversion to the requirements of the international network.



And the questions that arise in the food industry are still on the agenda: "Mega branches are built on an area of ​​700 meters and have about 6,000 barcodes that are in the consumption base of the Israeli consumer and to them should be added another 8,000 barcodes of the private label out of 14,000, because about a quarter will not be kosher because That they contain pork and seafood, where will they put them?

Customers are likely to come in to experience the overseas experience. The question is will they come again? (Photo: ShutterStock)

Will the Israeli consumer attack the private label?

"To set up a branch of an international chain is not to replace a sign at the entrance. There is an accurate planogram, and an investment of hundreds of millions, which cannot be made in 150 stores in three years. It will not happen because it is technically impossible ".



The same source adds: "French Carrefour is their Shufersal, unlike Polish Carrefour, for example, whose prices are 25% lower. So let's say the customer goes in to experience abroad and buys once or twice the cheap private label, but pays for Nestle products And Unilever expensively, he will not come again.

"As strong as Carpur's private label is, I'm not convinced that the Israeli consumer will attack it."



According to the data, the market share of private labels in the retail chains averages 6.6%, while in Shufersal, which is considered a phenomenon in the field, the private label accounts for about 20% of sales, including butchery, vegetable and bakery products, which "inflate" its market share.

The realistic estimates speak of only about 12% of sales of the private label in Shufersal.

A victory for the Israeli consumer or a bluff?

All the answers - soon (Photo: ShutterStock)

A bluff or a parallel import wins?

Here it is worth noting that Carpur's private label also includes "non-food" and cleaning products, and the training of the food products included in it, has already begun.

Although this is not strictly kosher, it is kosher that is acceptable to the Chief Rabbinate and therefore, according to the same sources, kosher will not be the factor that will delay the project.



"Carrefour is not the 'Leader Price' brand nor the 'casino' that produces it, it's not a price player," says a retailer.

"Inside the chain they have no discount, only a hypermarket, a supermarket and convenience stores, so to come and say they're going to break the market with the price, that's really not true, certainly not when the contract is with expensive France. I have a feeling they're bluffing here."



Contrary to this claim, other factors explain that the domestic department has at its disposal the international department, which can assist it in parallel import of big brands.

If the big companies block it in one country, it will be able to cheaply import parallel imports at cheap prices from another country.



Be that as it may, what is certain is that the opening of the Carrefour chain in Israel is a complex matter and if it does open by the end of the year, it could be the first swallow of international chains to come here - and perhaps finally lower the cost of living in Israel.



Electra Consumer did not respond to a request for comment

.

  • Of money

  • consumption

Tags

  • Electra

  • Retail

  • Mega

  • Bitan Wines

  • private brand

Source: walla

All business articles on 2022-04-24

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