A Case Study On Banque Accord: A Closer Look

Banque accordance of rights is a subsidiary of financial giant star the Auchan Group1. Founded in 1983, Banque accordance was established in dickens stages In 1983, with the outcome of ossification sell bank bills in Auchans hypermarkets and, in 1987, with Auchans acquisition of Banque Delort, a subsidiary and affiliate of the banking group known as Credit Commercial de France2. Auchan subsequently called its newly acquired bank as Banque mete out 3.The newly acquired banks mission was to customize the rules that withdraw proven successful in the area of sell distribution and bring it to the financial function field, by allowing consumers to avail of simple-minded yet innovative discounted mathematical products and services. 4 Essentially, Banque correspondence ope strand as a bank aligned with the credit and retail industries in general5. Put simply, Banque conformism brings electronic banking functions to retail merchants, and stipend and financing options want government notes and consumer credit, closer to its consumers.As a rule, the purchase of financial resources is backed by sound ratings from globally respected institutions equivalent Moodys and Standard & Poor. For the year 2006, Banque conformity received higher ratings compared to the previous year6. Moodys gave the bank an A2 grade, magical spell S&P gave it an A or St subject rating7. To note, the word lot suggests being able to agree on financial solutions for the companys clients8. The dynamism of Banque cede, which eventually became well-respected in international financial circles, is due to the occurrence that it is wholly-owned by a bank and a retail group.Since its inception, Banque Accord has celebrated achievements, four of which are9 (1) consolidating in the same organization electronic banking, issuing of retail cards and providing credit to consumers (2) creating a network of banking tools in shopping centers (3) an ever-widening snitty-gritty of goods a nd products available to clients (such as payment card facilities and services, revolving credit, traditional credit, and the equal. 10) and (4) its takeover of junky France in 2004, permitting direct online access under the monicker Oney.fr/ These factors, combined with the merchandise aesthesis of its Chief Executive Officer Damien Guermonprez, Banque Accord has evolved in 2006, into an international comportment with operations in nine countries, and a database of 4,800,000 guests11. 1 (Dauchy, 2007, p. 2) 2 (Dauchy, 2007, p. 3) 3 (Dauchy, 2007, p. 4) 4 (Dauchy, 2007, p. 4) 5 (Dauchy, 2007, p. 16) 6 (Dauchy, 2007, p. 16) 7 (Dauchy, 2007, p. 16) 8 (Dauchy, 2007, p. 3) 9 (Dauchy, 2007, p. 3) 10 (Dauchy, 2007, p. 3) 11 (Dauchy, 2007, p. 3) Banque Accord A Case view 1In Banque Accords financial disclosures for 2006, the company reflected a EUR353,167,000 increase in assets in righteous 12 months12. Banque Accord also reported a net income of EUR34,413,000 in 2005, as compared to EUR24,206,000 in 200413. Despite the potential for further international growth, Banque Accord has to contend with possible areas of difficulties, which include14 (a) the affair of mobile ph cardinals as potential backup for bank cards in transactions (b) innovations in consumer credit and (c) the developing of e- disdain in the retailing industry.Regardless of these trends that Banque Accord has to contend with, the bank continue to be innovative and continues to explore newer concepts to maintain its prestige and originality in the banking and retail industries. 12 (Dauchy, 2007, p. 17) 13 (Dauchy, 2007, p. 17) 14 (Dauchy, 2007, p. 17) 15 (Dauchy, 2007, p. 3) Banque Accord A Case Study 2 I. The Auchan Group Founded in 1961 by Gerard Mulliez, the Auchan Group started out in the North area of France with one hypermarket, which, simply defined, is a commercial conf manipulationd which combines a department store with a supermarket16.Currently, in 2006, the Auchan Group runs 36 0 hypermarkets splay across 11 countries. In France, Auchan operates 654 supermarkets 17. Since the inception of Auchan, the companys imaginativeness has remained the same. That is, to improve the acquire power of its customers 18. Banque Accord is an Auchan subsidiary which has developed an exclusiveity of its own within the Auchan Group. Nevertheless, Banque Accords mission is identical to Auchans, and in essence, the bank has a dual vision 19 customer oriented providing its clients with a means to purchase and corporate oriented assisting Auchan in maximize turnover and revenue, therefore aiding the Group to reduce costs. Accordingly, Banque Acords mission, The bank for consumers is aimed towards Auchans clients at the hypermarkets 20. Banque Accord achieves its mission by making available to Auchans clients, certain services like discounted financial options and payments which are directly ready to hand(predicate) to these clients.Being a part of the Auchan Group is a co ntributing factor to Banque Accords human resources practices By training a group of liable professionals who consider their jobs fulfilling, the company is able to achieve growth and guarantee their clients fibre service21. II. Banque Accords Internal Strengths In studying the case of Banque Accord, one is accosted with the companys inherent strengths. Whatever weaknesses there might be for the company, these are easily addressed based on the operating standards adopt by the Bank. Nevertheless, inherent strengths of Banque Accord include A. European Market ShareThe modes of payment offered by Banque Accord is characterized by divers(prenominal)ness, regulatory and technical issues and the intricacy of the esteem chain of the industry22. Cash payment is predominant in 16 (Dauchy, 2007, p. 4) 17 (Dauchy, 2007, p. 4) 18 (Dauchy, 2007, p. 5) 19 (Dauchy, 2007, p. 5) 20 (Dauchy, 2007, p. 5) 21 (Dauchy, 2007, p. 5) 22 (Dauchy, 2007, p. 6) Banque Accord A Case Study 3 Spain, Italy and Germany23. However, majority of Banque Accords clients in Great Britain and France use bank cards24. The bank card is considered a glacial product for the company that issued it25.The card can be very often compared to a traditional banks checking or current account, which is near convenient for customers to use. retailers or outlets that have tie-ups with bank cards are able to sell progressively, in coordination with various financial services like cross-selling or up-selling26. The European market where Banque Accord mainly operates was reportedly worthy EUR930 billion in outstanding credit in 2005 (Source Lobservateur Cetelem), and is manifesting riotous growths in many countries27. Within Europe, where Banque Accord operates, there are distinct differences between countries.In Great Britain for casing, the average outstanding credit per household is soprano that of Frances28. In simple words, buyers in Great Britain have greater use for bank cards than customers in Fra nce do. The differences between countries may be attributed to diverse cultural orientations, regulatory requirements and marketing procedures29. An some other(a) example is frequently, young hatful are refused credit on the grounds that they do not have a stable means of paying it. On the other hand, it is kind of common for a consumer to accumulate excessive credit30.A solution to this would be the use of regulatory systems and which monitor and prevent bad debts. B. Positioning and Diverse service The business of Banque Accord is30 (a) issuing polar pillow slips of payment cards like for example, retail cards, gift cards and bank cards (b) proffering consumer credit and other related services and (c) managing its retail partners electronic processing of monetary transactions. electronic Banking is a technical service directly given by Banque Accord to its retailers, which is a source of pride to the bank31. Its electronic banking services is geared towards procedure as a ba nk receiving transactions providing the support in the retailers way out of cards, managing authorization, 23 (Dauchy, 2007, p. 6) 24 (Dauchy, 2007, p. 6) 25 (Dauchy, 2007, p. 6) 27 (Dauchy, 2007, p. 6) 28 (Dauchy, 2007, p. 8) 29 (Dauchy, 2007, p. 8) 3-0 (Dauchy, 2007, p. 8) 31 (Dauchy, 2007, p. 9) Banque Accord A Case Study 4 2005, to form a division called CardOps33. Being owned by a retailing group, Banque Accords aim is ATMS, payment terminals, etc 32. Banque Accords electronic banking services were grouped together in proximity to its customers, and minimizing costs of electronic banking.The core business of Banque Accord is the issuing of a range of cards, which have different functions. The banks cards may be a type of payment, a retailers marketing tool, a support product of the bank that is incorporated in its associated services34. It is widely said that an Accord card may be likened to a Swiss Knife with flexibility in functions credit card, payment card and devotedty card 35. Various examples of an Accord cards use are36 (a) Sample 137 Card fount Retail Card act A payment card issued or released by retailerBanque Accord Auchan cradholders total 4,000,000 in Europe, and the card is accepted by other retailers (b) Sample 238 Card Type Loyalty Card Function Retailers marketing instrument which could be used to attract and maintain a loyal base of clients Banque Accord N/A (c) Sample 339 Card Type Bank Card Function A traditional card issued by banks, this card may be used overseas Banque Accord MasterCard Accord and visaCard Accord (d) Sample 440 Card Type Gift Card 32 (Dauchy, 2007, p. 9) 33 (Dauchy, 2007, p.9) 34 (Dauchy, 2007, p. 9) 35 (Dauchy, 2007, p. 9) 36 (Dauchy, 2007, p. 10) 37 (Dauchy, 2007, p. 10) 38 (Dauchy, 2007, p. 10) 39 (Dauchy, 2007, p. 10) 40 (Dauchy, 2007, p. 10) Banque Accord A Case Study 5 Function This type of card may be utilized to personalizedize service, and enhances customer relationships. Banque Accord Auchan Gift Card Hence a card is effective to ? the retailer, because it can be used as a marketing instrument and promotes consumer dedication and ? the consumer, because it is convenient means of financing and payment41There is a distinct continuative between owning a card, how the type of card benefits the customer and the retailer, and the amount of business the customer does with the retailer42. It is established that a customer who has access to credit through cards increases his or her purchasing power. A client who has no card hardly visits a retailer in a month, owning a loyalty card enables a customer to make three visits. Having a retail card allows the client to make four visits per month to the favorite retailer and having a bank card gives the client the opportunity to make at least five visits to the retailer 42.Banque Accord boasts of an orientation which is discount-oriented and customer-oriented43. Banque Accord has two selling and pricing concepts44 annual subscri ption and cash back, which is defined as the bullion paid to the customer related t his or her card use. For example in France, Banque Accord gives a 40% discount incentive to annual subscribers for a refular Visa Card, and 60% discount on a Visa Premiere Card45. Based on the spending habits of the customers, an annual subscription increases the potential for the cleints purchasing statistics. Other Financial ProductsApart from cards, Banque Accord also offers its clients other services, lilke46 (1) in-store credit wherein the individual retailers define their own credit policies along with different formulas for achieving revenue (2) personal loans, which are granted to customers as a come-on, at interest rates based on current market prices (3) revolving credit, which is built up by a credit reserve 41 (Dauchy, 2007, p. 10) 42 (Dauchy, 2007, p. 10) 43 (Dauchy, 2007, p. 10) 44 (Dauchy, 2007, p. 10) 45 (Dauchy, 2007, p. 12) 46 (Dauchy, 2007, p. 10) Banque Accord A Case Study 6 (4) Auchan savings account(5) life insurance, which is a tieup with Suravenir and offers life plans at simple and reduced costs and (6) non-life insurance. As evidenced by the wide range of other services that Banque Accord offers, its value chain is distinguished by a huge number of product alliances47. Thus, Banque Accord has been known for its flexibility. As a result, the bank has largely-increased the potential spending capacity of its client-base. Sometimes, the banks products are managed by other partners at times their competitors depending on which country the operation is in48.