Carrefour's Russian Market Exit
Added on 2020-04-07
4 Pages410 Words48 Views
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Student’s Last Name 1Leading and Managing in Culturally Diverse EnvironmentsBy (Name)CourseProfessorUniversityDate
Student’s Last Name 2IntroductionThis paper discusses some of the difficulties encountered by Carrefour after venturing into the Russian market regardless of the two years’ research conducted on the market availability. Carrefour is the second biggest retailing organization based in France earning over 108 billion Euros annual income (Gollnhofer, & Turkina, 2015, pp.41). By 2008 it had penetrated a lot of regions except of Russia. Due to this, Carrefour started researching on the available gaps in the Russian retail market that could be easily manipulated. Some of the strategies used to enter the market are highlighted in this paper as well as the reasons behind the sudden exit.Entry and Exit StrategiesThe announcement that Carrefour was soon going to exit the Russian market was made on October 2009. The organization gave reasons such as they were not growing. Also, there werefew opportunities available for the taking (Gollnhofer, & Turkina, 2015, pp.22). Research, however, showed that the major factor that led to this sudden exit was the fact Carrefour was unable to acquire the Seventh Continent. Among the organizations entry strategies were the acquisition of the Seven Continent which would mean fair competition with other retailers such as Auchan and, X5 Retail Group. Another reason was the complex nature of the Russian legislative wing which mostly favored the local investors. Finally, heightened levels of corruption in the retail market as well asthe rules set in place to regulate the institution’s operations (Frynas, & Mellahi, 2015, pp.34). Forexample, Carrefour was faced by a complex bureaucratic problem in its effort to acquire a permit
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