Lee Scott, CEO, went to Europe to check up on the competition:
But he is not completely without a to-do list. Taking in Europe for Mr Scott, flanked by an entourage of advisers, also means lots of store tours. As every good retailer knows, that is much more about checking out what your competitors are doing than just looking at your own - struggling - operations in Germany and the UK.From what I understand, Wal-Mart isn't doing nearly as well in Europe. Aldi, in particular, is a tough competitor who has a large share of the German budget shopper. They are cheap, yet have better margins than WM.So in Germany he was touring rivals Lidl and Aldi and Metro. In Brussels he was visiting Carrefour. In the UK, where Wal-Mart owns Asda, he took in a raft of competitors, such as Tesco and J Sainsbury, the first and third largest supermarket operators, and Matalan, Argos and Next, which Asda competes with on non-food ranges such as clothing and cameras.
Mr Scott, whose company generated a staggering $285bn sales last year in the US and nine other countries from Brazil to China, says he has learnt a lot from this trip.
He picks on the Carrefour outfit he saw in Brussels. "The Carrefour store is very specifically aligned to the market area they are in. They use the one price, it is a modest income area here and that store is dominated by number one price. They are addressing the consumer and the store was incredibly busy," he says with a hint of admiration.
His mind jumps to Tesco, the UK's most successful retailer by some stretch with a 30 per cent market share of supermarket shopping. "You go to a Tesco and there was a couple of items in Tesco that I haven't seen in Asda in a feature space which is probably doing well. So I look at pricing across some of the markets and Asda pricing in relation to that."
Posted by Bob on June, 27 2005 at 09:04 PM
