Detailed PESTEL Analysis of Carrefour
PESTEL Analysis by EdrawMax is a strategic management tool that Carrefour leadership can use to make better decisions.
1. Lead-in
When a Brand plans to expand its business, it needs to know its strengths, weaknesses, future opportunities, and threats. Simultaneously, they should be aware of various external or macro factors influencing their present status. Carrefour is a France-based retailer with customers in different parts of the globe; some countries in Europe, Africa, and America included its area of operation. The retail industry is a competitive market, and the brand has earned a stable position there. PESTEL Carrefour discusses the factors that contributed to their present condition and hints at their chance of growth in the future.
2. About Carrefour
2.1 Introduction of Carrefour
Carrefour is one of the world's largest retailers concerning revenue and has already expanded its business outside Europe, in America, Africa, and some Asian countries. They serve as a retail and a wholesaling brand. Moreover, they also have groceries and convenience store chains. As per the data for 2021, Carrefour is present in more than 30 countries and has around 12,225 stores.
The company is headquartered in France but has established itself as a global brand. Its brand image is responsible for its massive customer base on various continents. PESTEL Carrefour analysis reveals the present status of the company in the retail market and the external factors contributing to it. You need to check the basic information about the company to do a proper and detailed PESTEL Carrefour analysis.
2.2 Overview of Carrefour
| Company Name: | Carrefour |
| CEO: | Alexandre Bompard |
| Company Type: | Retail industry, wholesaling |
| Year Founded: | 1st January 1958 |
| Employees: | 321,383 (2019) |
| Annual Revenue: | $84.13B |
| Founder: | Marcel Fournier, Denis Defforey, Jacques Defforey |
| Area Served: | Europe, South America, North Africa, South Africa, East Africa, East Asia, Middle East |
| Headquarters: | Essonne, France |
| Operating Income: | €2.27 billion (2021) |
3. Carrefour PESTEL Analysis
PESTEL analysis is a widely used tool that shows the role of external factors responsible for sustainable company development. PESTEL analysis discusses the impacts of components like politics, economy, society, technology, environment, and the law on the brand's success. PESTEL Carrefour not only analyzes the potential company growth but will also give insight into the business strategies of the brand.
Political Factors:
When a brand grows, they need to have a keen eye on the political condition of the areas they serve. Political instability can be responsible for the change in people's buying habits that reflect on their sales.
- The taxation policy set by the government has played a significant role in the business of Carrefour. The low taxation rate in the United King has allowed the brand to enjoy a good profit margin. They can have a fair amount to invest in different departments to improve their service.
- The taxation policy set by the government has played a significant role in the business of Carrefour. The low taxation rate in the United King has allowed the brand to enjoy a good profit margin. They can have a fair amount to invest in different departments to improve their service.
- Trade laws and trade ties between countries can be helpful for the business of Carrefour. They will be able to establish a smooth supply chain and seamless distribution system. The government's policy regarding foreign investments can impact Carrefour sales.
Economic Factors:
The condition of a business and a country's economy is closely dependent on each other. If the global economy is moving upwards, that will add to the growth of the brands. Here are some economic factors that can impact the business of Carrefour:
- Employment rate, per capita income, and the country's GDP directly influence a business, and their chance is reflected in the brand's sales figure. If the unemployment rate is high, people will only try to get what is necessary instead of buying whatever they want. A decrease in per capita income will put some restrictions on the buying tendencies of people, which will eventually impact the business.
- Having skilled laborers and efficient employees is the best way to improve the performance of a business. Shortage of labor can increase demand, resulting in a decrease in the profit margin. Carrefour can build an efficient workforce for their company by paying proper wages and complying with labor laws.
- A moderate inflation rate is healthy for the economy and therefore plays a significant role in the growth of businesses as well. Higher inflation can decrease an individual’s overall spending rate, which may negatively impact Carrefour. Similarly, if the inflation rate is low, there will be an increase in competitiveness. The faulty pricing strategy can also create a negative brand impression on the consumer.
Socio-cultural factors:
Age, culture and social trends impact individual buying tendencies and preferences. Thus, sociocultural factors play a significant role in the growth of a business. PESTEL Carrefour shows how sociocultural factors have worked on its growth:
- The health consciousness among people is gradually increasing, and they tend to follow healthy food habits. Carrefour has incorporated the idea of health in its marketing, and this has attracted a massive number of consumers. They have brought a range of organic products, which are popular with the people who value their health.
- Carrefour has done thorough market research to understand its customers. A large section of the young generation belongs to their customer base. They have considered the economic classes, age range, and preferences while bringing in new products for their customers and potential customers.
- Retail businesses are concentrating on strengthening their online business besides their physical stores. After the pandemic, many people have opted to buy groceries and other necessities online. Carrefour should work on its online presence and create a smooth channel to provide customers with a comfortable shopping experience.
Technological factors:
Technological advancement has brought significant changes in almost all fields, and competitive markets like retail are no exception. Technology has not only changed people's buying habits but has also given people the option to get their favorite products delivered to their doorsteps from miles away. Here are some technological factors that can affect the business of Carrefour:
- Social media platforms have given brands a chance to reach enormous target audiences in a short period. They can improve their performance by creating a robust social media presence and can use social media marketing to get more organic traffic to their website and social media pages.
- Retail businesses can use technology to improve their customer service. They can create a smooth supply chain and logistic services to offer a smooth shopping experience to the customers. They can decrease the waiting time by creating better connectivity between teams which will keep them ahead of their competitors.
- Though the brand has successfully created a brand image, they need to keep adding to it to ensure a better position in the market. Customers can find a brand more reliable when they can conduct smooth communication. Carrefour can use AI-based technologies to communicate with customers and create a 24X7 customer-service channel. They can also use AI to offer a personalized experience to customers.
Environmental factors:
The environmental consciousness among the people is growing, and as a result, the brands are also paying attention to creating sustainable habits to avoid harming the environment. Organizations can take several measures to maintain the nation's environmental standards.
- There are many selling units of Carrefour located in urban areas, and governments of some countries are strict regarding the waste generated by the businesses. Carrefour can have a department to deal with the waste generated from their business and prioritize recycling. They can use paper or recyclable items for packaging to control plastic pollution.
- The businesses are concentrating on using more renewable energy sources, substituting the non-renewable ones. The brand may prefer using electric cars for logistics and solar energy for power supply in stores. They must also take care of the laws concerning energy consumption by the companies.
- As a retail business, Carrefour can promote eco-friendly products that comply with environmental standards. Carrefour can use its research department to focus on the quality of these green products.
Legal factors:
A brand should follow the nation's rules and regulations while operating in multiple countries. Otherwise, it will harm their brand image, and their business may get banned. Here is how legal issues can impact the business of Carrefour -
- Most countries have employee protection and labor laws to ensure the rights and safety of the workers. Having a secured workforce is favorable for any business. Carrefour needs to have departments regularly check the equipment to avoid accidents. The brand has already shown its adherence to the safety and welfare of its workforce.
- Most countries have employee protection and labor laws to ensure the rights and safety of the workers. Having a secured workforce is favorable for any business. Carrefour needs to have departments regularly check the equipment to avoid accidents. The brand has already shown its adherence to the safety and welfare of its workforce.
- The countries have laws regarding foreign investments and taxes. The companies must abide by those rules to avoid getting banned from operating in the country.
4. How to Do a PESTEL Analysis in EdrawMax
- Step - 1: Preparation
- Step - 2: Template Selection
- Step - 3: Add Textual Information
- Step - 4: Customize
- Step - 5: Export & Share
If you are using the offline version of EdrawMax, open the tool in your system. If you wish to access remote files, head to https://www.edrawmax.com/online/ and log in using your registered email address. If this is your first time using the tool, you can register with your personal or professional email address. Go to 'Marketing' diagrams under Business diagram type and click on 'PEST Analysis.'
EdrawMax has thousands of free templates. Head to the Template section on the left and type 'PESTEL Analysis' to see all the pre-built PESTEL Analysis templates like Netflix PESTEL Analysis, Amazon PESTEL Analysis, IKEA PESTEL Analysis, and more. Check the template that resonates closely with your business model. Click on 'Use Immediately' to import the template's contents to the EdrawMax canvas. You can start customizing the PESTEL analysis diagram as per your requirements. If you want to draw the PESTEL analysis diagram from scratch, you can click '+.' It will open up the user-friendly canvas of EdrawMax that has several features that ease your efforts in making PESTEL analysis diagrams.
PESTEL Analysis diagram requires you to add Political, Economic, Sociological, Technological, Legal, and Environmental content so that the reader will understand what influences an organization. Use the PEST symbols from the left side and add the content to your PESTEL analysis diagram.
EdrawMax gives you ample options to customize your PESTEL Analysis diagram. From changing the background to adding content, you can customize the diagram in any way you desire. In addition to this, you can go ahead and change the background color, modify the text, add hyperlinks, add multiple pages, add images, and even add vector-enabled texts to your PESTEL analysis diagram.
Once satisfied with your PESTEL Analysis diagram, you can export it into multiple formats, including Microsoft, JPEG, PNG, Visio, HTML, and more. EdrawMax lets you share your PESTEL Analysis diagram on social media platforms, like Facebook, Twitter, Line, etc.
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5. Key Takeaways
The retail market is highly competitive, and various new brands are entering the space now and then. To ensure a healthy business environment, the government can set policies to encourage healthy competition among them. It will provide brands like Carrefour with the chance to grow. They need extensive market research before they set their goals and work on their business strategies. PESTEL Carrefour analyzes the effects of macro factors in the business. Hence PESTEL Carrefour can allow the company to know the fields that need to be taken care of while they create their business goals.
EdrawMax Online is a perfect PESTEL Analysis diagram maker because of its amazing features for all registered users. As you saw here, creating a PESTEL Analysis diagram with EdrawMax does not require any technical expertise, all thanks to the pre-built templates and customization options. Download the copy of EdrawMax today and start working on PESTEL Analysis diagrams per your requirements.
Reference
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Pro, E., 2022. Solved: Carrefour PESTEL / STEP / PEST Analysis & Solution., [online] embapro.com. Available at: https://embapro.com/frontpage/pestelcoanalysis/17864-carrefour (Accessed 29 August 2022).
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Team, M., 2022. Carrefour PESTLE Analysis | MBA Skool., [online] MBA Skool. Available at: https://www.mbaskool.com/pestle-analysis/companies/18002-carrefour.html (Accessed 29 August 2022).
