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Analysis of Group AUCHAN

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    1. Strategic segmentation and diagnosis of business portfolio
    2. The overall organization of the group Auchan SA
  3. Corporate Structure
  4. Study of different strategic areas
  5. Finance Segment- Banks (ACCORD)
  6. The real estate segment (IMMOCHAN)
  7. New concepts
  8. External diagnostic
  9. The Macro-Environment
  10. Political factors
  11. Economic factors
  12. Socio-cultural factors
  13. Technological factors
  14. Environmental factors
  15. Legal Factors
  16. The Industry
  17. The retail Industry
  18. The Finance Industry
  19. The analysis of a strategic group
  20. SECTION 2 - The Auchan Group's strategy
  21. Objectives of French market dominance
  22. Internationalization
  23. Strategic choices

In 1961 Gerard MULLIEZ founded his first supermarket in the Hauts-Champs of the city of Roubaix. It was not until 6 years later that G. MULLIEZ opened his first hypermarket in Tourcoing. From there, the group's growth has continued to progress. This was followed by the opening of its first shopping center in the north, which was the stronghold of the group Auchan.

Ten years after opening its first store in the chain of distribution, Gerard MULLIEZ's successful enlargement on the national level took place with a large number of new openings per year.

Twenty years later Auchan sought to penetrate the European market for retail. It thus established itself in Spain under the brand Alcampo. Today, the group Auchan is of considerable size. It is present in 12 countries and employs more than 140,000 employees and a turnover of 37.5 billion Euros. One may ask what the determinants of such rapid growth were. How has the AUCHAN Group diversified its activities to adapt to the constraints of the market?

We will first diagnose the Auchan group by specifying what its segmentation strategy is, and making external diagnosis. Then we will see the different strategic orientations that the group has followed in recent years, and the results of these different objectives.


I. Strategic segmentation and diagnosis of business portfolio

Strategic segmentation is the process which helps to delineate the different strategic business areas (SBU's) of an organization. This division is delicate; it distinguishes itself from the marketing segmentation, as different areas of activity from this division must meet the external and internal criteria.

As a first step, we will see that the Auchan group was able to develop internationally. Then we study the different areas that make up this strategic multinational more precisely.

A. The overall organization of the group Auchan SA

1. In addition to the measures set forth in article 8 of this Convention, each State Party shall, to the extent appropriate and consistent with its legal system, adopt legislative, administrative or other effective measures to promote integrity and to prevent, detect and punish the corruption of public officials. The allocation of capital

The entire capital of the AUCHAN group is divided between the Mulliez Family Association (AFM), and the group's employees. Thus AUCHAN SA is not on the stock exchange. The role of the family in the life of Mulliez group Auchan, is really prominent. Indeed, the family association of Mulliez (AFM) holds 84.51% stake in the group; it is also one of the three richest families of France on a professional level (source: Challenge, July 2002).

At the level of employees, capital is acquired through a company savings as a mutual fund (FCP). La Fond Commun de Placement "Valauchan" represents 14.55 of the capital, while that of "Valauchan International" is 0.94. At supermarkets, the group has more recently created FCP "Valsuper" and "Valsuper International", with a heritage of 118 Million Euros to 15,400 shareholders. We are still very far from Heritage Valauchan which amounts to nearly 1.57 billion Euros to 80,600 shareholders. The Valauchan name given to the shareholders of Auchan, consists of a share of stock of Auchan and other securities outside the company (cash redemption). Each year, three experts determine the value of the share from these two components.

Gradually, each country started by Auchan stood to benefit shareholders. Thus, the Spanish collaborators, and more recently the Hungarians become shareholders of the group.

2. Corporate Structure

Like many multinationals, Auchan had to adapt its structure to its growth. It opted for a group structure valid for unrelated diversification. Headquarters activities limit to 3 or 4 sectors. The seat functions as a sort of mini financial market that deals with the distribution of financial resources between the various group subsidiaries. Each geographical area has some flexibility in its organization. There is for example a purchasing country, even if all these central purchasing units are pushed to follow the same procurement policies with suppliers.

Tags: Auchan Group, analysis and diagnosis of organiztional structure, strategic business segments

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