Carrefour’s China business turned profitable in the fourth quarter of 2019, reversing its loss-making operations for the first time in seven years, Chinese media outlet Yicai.com reported, citing the unit’s CEO Tian Rui’s remarks during Suning.com’s earnings call on Tuesday.
Measures behind this change include cost cuts in storefront maintenance and human efficiency increase by about 10% year-on-year under proper incentives. In addition, Carrefour China’s integration with Suning’s ecosystem has also played a large role since this has helped it become a supplier for more than 5,000 convenience stores and has allowed it to rely on Suning’s logistics fleet.
This reversal of fortune comes five months after Suning.com announced in late June that the company agreed to buy an 80% stake in Carrefour China, which has been operating in the country for 24 years, at RMB 4.8 billion (USD 700 million), with Carrefour holding the remaining stake.
This article is part of KrASIA’s “China Brief” section, where KrASIA’s reporters will provide quick daily updates about the tech ecosystem in China.
