CFAO pivots from hypermarkets to hybrid-markets in West Africa

Multinational conglomerate CFAO has brought the Carrefour brand to Senegal, opening a 1,800m² Carrefour Market in Dakar, what head of CFAO Retail Jean-Christophe Brindeau described as a “soft launch.” Brindeau also signalled a shift in CFAO’s West African strategy away from hypermarkets and towards a new hybrid banner.

CFAO is planning to bring the Supereco “low-cost” banner (which is already present in Spain and Latin America) to Cameroon, Côte d’Ivoire and Senegal, opening nine outlets by the end of this year, in addition to five Carrefour markets. He added that plans to open stores in Congo Republic, the DRC, Gabon, Ghana, and Nigeria were being put on hold so that CFAO could concentrate on the former three markets.

Brindeau asserted that CFAO was pivoting away from hypermarkets in West Africa because even smaller hypermarkets of 4,000m² could not attract enough consumers to be profitable. He added that “Hypermarkets and supermarkets are for the middle- and upper-class, which represent 15% of the population. But these groups are not growing quickly enough, so we had to develop a new format” – stores with a sales area of 700-1,000m² and carrying no more than 2,500 SKUs that are positioned as a hybrid of the discount supermarket and cash-and-carry formats.

Noting the tension that has developed between Auchan and informal traders in Senegal (see our previous story), Brindeau is seeking to adopt a more collaborative approach by offering them bulk discounts: “We don’t want to fight with them – we are going to try to work with them.”

If you want to read more, click here