The problem of Carrefour is that there are restrictions in building hypermarkets with political barriers. It is difficult to achieve its regular pace of expansion, two new construction per year in France, and the success of Carrefour led to further competition in France. Competition against large retailers outside France is much harder than domestic competition. Carrefours Strategy 1960s~1970s: two new construction permission per year => the political intention hinders the expansion of hypermarket, and vied for attractive location Joint venture; Carrefour shared its retailing know-how and trademark with potential partners in exchange for ownership interest(10~50%) and franchise fees(0.2% of total sales). Problem from financial statements Debt increases: Analysis Income statement shows Revenue increases RAPIDLYgrow from 1969 to 1971 Less: value added tax? Gross profit margin: steady around 15% Profit over sales: steady around 2% earning /shareholder; rapid increase from 69~71