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BUSINESS STRATEGY

French supermarket chain to grow African presence and enter Algeria

By our News Team | 2023

Auchan – a competitor to Carrefour – will make Algeria its fifth market on the African continent later this year.

French-based supermarket chain Auchan, which already operates in various parts of Africa, is to enter the Algerian market in the latter part of this year.

In doing so it will be in competition to Carrefour, another French supermarket chain with strong African connections. Carrefour currently operates two outlets in Algiers, the largest city and capital of Algeria.

Business Strategy

An Auchen supermarket outlet in Moscow, Russia. Photo via Wikimedia Commons

According to Trend Type, the London-based emerging market consultancy, Auchen first started looking for a suitable local partner more than 15 years ago. It will now partner in-country with the Great Way group.

The latter is a well-established clothing retailer with around 80 stores in Algeria. It is also the local franchise holder for major global brands such as Adidas and The Athlete’s Foot.

“It’s a big leap of faith for Auchan, which has prioritised the quality of the partnership and retail expertise over knowledge of the grocery sector,” commented Trend Type.

Algeria is a difficult market to crack

“Operationally, Algeria remains a complex and difficult market for foreign brands. [This is due to] a combination of fx (foreign exchange) access problems, import bans, difficulties registering products and poor-quality local partners. 

“The grocery retail sector is highly fragmented. Despite being one of the highest income and most-developed markets in Africa, there are no national or even regional grocery chains.”

Auchan has an existing African presence in Senegal (its largest market), Cote d’Ivoire and Mauritania. It also operates the Jumbo hypermarket in the Angolan capital, Luanda, through a Portuguese-based subsidiary.

Auchan was founded in 1961 and operates in a number of countries – including France, Spain, Portugal, Luxembourg, Poland, Romania, Hungary, Ukraine, Russia and Taiwan.

There has recently been controversy around its continued presence in Russia, following that country’s military action against Ukraine. There have also been allegations that its Russian outlets are providing assistance to Russian troops.

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