Private Label

Focus On Private Label 'Paying Off' For Carrefour, Says Analyst

By Steve Wynne-Jones
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Focus On Private Label 'Paying Off' For Carrefour, Says Analyst

Carrefour's focus on private label is 'paying off' for the retailer, an industry analyst has suggested, after the retailer reported a 4.7% increase in like-for-like sales in its home market.

Joe Dawson, retail analyst at GlobalData, was commenting after Carrefour reported that food sales were up 6.0% in France for the full year, "which counterbalanced a decrease in non-food sales, as consumers prioritised spending on essentials".

This food growth has been largely driven by investment in private label, he added, noting that own-brand products now account for 36% of its sales in food, up from 33% at the end of 2022.

The retailer has also been active in "publicly calling out brands that raise prices" – such as its recent spat with PepsiCo – thereby strengthening the value proposition of its own brands.

Private-Label Share

One of the core pillars of the retailer's Carrefour 2026 strategy is to have private label account for 40% of food sales by 2026.


"A focus on being competitive in price and providing the best value to its customers has paid off, as well as improvements to its digital strategy supporting an increase in online GMV of 26% to reach €5.3 billion," Dawson said of the retailer's performance.

"Amid high inflation at the start of 2023 that has eased somewhat throughout the year, Carrefour is entering 2024 in a good position, with strong cash flow generation and an increase in dividends indicative of its stellar results."

He noted that of the European countries in which Carrefour has a presence, Spain was a highlight, with the recent acquisition of 47 supermarkets from El Corte Inglés "highlighting its continued expansion plans in the region".

'Capital Disciplined'

Elsewhere, analyst Clive Black of Shore Capital noted that despite some market challenges, such as inflation, Carrefour has become more "capital disciplined, prioritising what is important in a more refined market assortment, seemingly operating well in terms of cost focus and targeted investment, and so even with a modest decline in recurring operating income, the firm is growing its dividends, engaging in a buy-back and paying down net debt.

“The days of major international grocers seeking to plant flags across the globe are well behind us, with the prime priority for the likes of Carrefour, Tesco and Walmart being competitiveness and the extraction of cash flow from operations from their home markets, supported by more complementary external activities, where a robust market position is evident.”

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