Alimentation Couche-Tard has just entered the select club of the 200 largest companies in the world, announced the latest Global 500 ranking of American magazine Forbes.
• Also read: The more powerful Chinese behemoths
The Laval retailer climbed to 183rd among the global giants, just behind Japanese rival 7-Eleven (178at area), but ahead of big names such as Unilever (185at place), Goldman Sachs (202at place), LG Electronics (207at place), Pfizer (215at area), the Royal Bank of Canada (223at area) and Rio Tinto (280at square).
The ranking of Forbes uses revenues recorded by Couche-Tard during its fiscal year ended April 30, 2019, or US $ 59.1 billion (CA $ 78.3 billion). Due to the pandemic, the company’s revenue dropped 8% in 2019-2020 to reach US $ 54.1 billion (more than CA $ 71.6 billion).
In seven years of the Global 500’s presence Forbes, Couche-Tard rose by 146 places. In 2014, the company was at 329at rank.
Third in Canada
In terms of revenue, Couche-Tard is currently the third largest company in Canada, behind Toronto heavyweights Brookfield Asset Management (155at area) and Manulife (181at square).
“This is the only Canadian company that has truly succeeded in international retail trade,” said finance and management expert Michel Nadeau.
He pointed out, however, that nearly three-quarters of Couche-Tard’s revenues come from fuel sales, a sector that is set to decline with the growing popularity of electric vehicles.
In addition, some other products sold in convenience stores and gas stations are also declining, such as candy, cigarettes and softdrinks.
“This is one of the enormous challenges facing Couche-Tard: how to recreate itself?” Said Mr. Nadeau.
In Norway, where half of all new vehicles sold are electric, Couche-Tard promotes high-quality pastries to generate sales while customers wait to charge their vehicle.
Quebec’s roots are under threat
Michel Nadeau is also concerned about Quebec’s presence within the company. CEO since 2014, American Brian Hannasch lives in Indiana and spends little time at headquarters in Laval.
In fact, only one of the company’s eight top executives – chief financial officer Claude Tessier – lives in Quebec.
Additionally, the multiple voting shares that give Couche-Tard control to its four founders will expire at the end of next year. The company will be more vulnerable to a hostile acquisition.
“The board of directors must make sure that Couche-Tard does not lose its roots in Quebec,” Mr. Nadeau said.
It should be noted that Seven & I (owner of 7-Eleven) defeated Couche-Tard for the acquisition of American chain Speedway, a US $ 21 billion (over CA $ 27.8 billion) transaction that would solidify its status as a world leader in the sector.
Analysts believe, however, that Couche-Tard was able to pass its turn, judging the price too high.
Cannabis and variable prices
In an interview with Forbes, Mr. Hannasch said Couche-Tard has bet specifically on cannabis to stimulate its future growth. The company is already a shareholder of a Canadian retailer active in the sector, Fire & Flower.
“Someday it will be legal in most of the United States,” he said.
The executive also revealed that Couche-Tard is currently testing “dynamic pricing”, which involves adjusting the prices of certain products according to real-time demand at each store.
“It’s easier to charge $ 1.69 for a Pepsi at any store,” Hannasch said. But if you take a few cents here, a few cents there, it adds up quickly when you have 10,000 establishments. »