Geant focuses on pricings, restructuring to grow
By Jason Tan
The China Post
Geant, the nation's third largest hypermarket operator, is currently focusing on pricing strategy and restructuring exercises to ensure survival in the competitive retailing industry.
As a start, it is forgoing NT$60 million in profit for its recent mid-year discount extravaganza, informed Geant president Pascal Billaud, at a press briefing yesterday.
The discounts, which will be over 40 percent, will be applied to 2,000 items in total.
"We started to implement price reductions on merchandises since last month and have seen some improvements," he added.
Billaud, who just came on board in March, said that hypermarkets are now faced with stiff competition in Taiwan and the operators are only now earning two percent margins.
Geant is thus turning into restructuring exercises in a drive to streamline operations and increase profitability.
Among them is an interactive solution capable of offering auto replenishment of products and facilitating connection of store outlets and suppliers.
The new system will reduce its logistics costs and enable it to maintain sufficient stocks. It is currently under trial and will go "live" for the first store in September, with others following suit by the end of the year.
In terms of business performance, Billaud revealed that its first quarter revenue results are on track.
He, however, refused to reveal the exact numbers, and added that Geant's breakeven plans are not likely to happen this year.
In terms of store expansion, it is slated to open up a store in December and another one in 2006.
Meanwhile, RT-Mart, the second largest hypermarket chain in the island, plans to set up a drive-through store in Taoyuan in the second half of the year.
This drive-through store will enable a quick shopping experience to buyers as they can just place and get their orders in the car without stepping out, informed Josie Lee, RT-Mart's public relations specialist.
According to Lee, this new store will be comparatively smaller in size compared to its other 23 stores. However, consumers will be guaranteed efficient shopping time and discounted daily necessities.
RT-Mart had just launched its "Thailand Week" extravaganza on Wednesday.
The chain store imported 500 items such as ingredients, food, fashion or accessories from Thailand, with values totaling NT$120 million. Simultaneously, it is holding related prize drawings and activities with performers traveling from Thailand to entertain crowds.
The retailer said that this is a way to reward customers while at the same time bringing Thai culture to the locals.
RT-Mart experienced two-digit growth in revenues in the first quarter over the same period of last year. "We expect to maintain the stable growth momentum for this year," Lee stated.
Meanwhile, the nation's largest hypermarket, Carrefour, started reshuffling 18 of its total 34 stores since late 2003. There will be five more stores to be remodeled this year.
The move includes renovation, as well as incorporating food courts and shopping outlets into the conventional hypermarket.
Carrefour hopes to expand the total stores from the current 34 to 50 by 2008.
The hypermarket industry reported NT$120 billion of turnover in total last year. Carrefour totaled NT$50 billion of revenue, translating to around 43 percent of market share.
It said in March that it aims to grab over 50 percent of share and achieve single-digit revenue growth this year.
The China Post
Geant, the nation's third largest hypermarket operator, is currently focusing on pricing strategy and restructuring exercises to ensure survival in the competitive retailing industry.
As a start, it is forgoing NT$60 million in profit for its recent mid-year discount extravaganza, informed Geant president Pascal Billaud, at a press briefing yesterday.
The discounts, which will be over 40 percent, will be applied to 2,000 items in total.
"We started to implement price reductions on merchandises since last month and have seen some improvements," he added.
Billaud, who just came on board in March, said that hypermarkets are now faced with stiff competition in Taiwan and the operators are only now earning two percent margins.
Geant is thus turning into restructuring exercises in a drive to streamline operations and increase profitability.
Among them is an interactive solution capable of offering auto replenishment of products and facilitating connection of store outlets and suppliers.
The new system will reduce its logistics costs and enable it to maintain sufficient stocks. It is currently under trial and will go "live" for the first store in September, with others following suit by the end of the year.
In terms of business performance, Billaud revealed that its first quarter revenue results are on track.
He, however, refused to reveal the exact numbers, and added that Geant's breakeven plans are not likely to happen this year.
In terms of store expansion, it is slated to open up a store in December and another one in 2006.
Meanwhile, RT-Mart, the second largest hypermarket chain in the island, plans to set up a drive-through store in Taoyuan in the second half of the year.
This drive-through store will enable a quick shopping experience to buyers as they can just place and get their orders in the car without stepping out, informed Josie Lee, RT-Mart's public relations specialist.
According to Lee, this new store will be comparatively smaller in size compared to its other 23 stores. However, consumers will be guaranteed efficient shopping time and discounted daily necessities.
RT-Mart had just launched its "Thailand Week" extravaganza on Wednesday.
The chain store imported 500 items such as ingredients, food, fashion or accessories from Thailand, with values totaling NT$120 million. Simultaneously, it is holding related prize drawings and activities with performers traveling from Thailand to entertain crowds.
The retailer said that this is a way to reward customers while at the same time bringing Thai culture to the locals.
RT-Mart experienced two-digit growth in revenues in the first quarter over the same period of last year. "We expect to maintain the stable growth momentum for this year," Lee stated.
Meanwhile, the nation's largest hypermarket, Carrefour, started reshuffling 18 of its total 34 stores since late 2003. There will be five more stores to be remodeled this year.
The move includes renovation, as well as incorporating food courts and shopping outlets into the conventional hypermarket.
Carrefour hopes to expand the total stores from the current 34 to 50 by 2008.
The hypermarket industry reported NT$120 billion of turnover in total last year. Carrefour totaled NT$50 billion of revenue, translating to around 43 percent of market share.
It said in March that it aims to grab over 50 percent of share and achieve single-digit revenue growth this year.
posted by jason tan @ 3:10 AM
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