Closed check-out lines at the Carrefour store in Foshan, Guangdong. Most shop owners in the store were unhappy at it closing during the New Year's Day holiday. [China Daily]

Vendors at a Carrefour store that closed last week said they would talk with the retailer about compensation and threatened to bring the company to court if negotiations fail.

The Carrefour store in central Guangdong's Foshan city closed for business on Jan 1, and the company refused to give compensation to most of the vendors in the store, according to Zhang Wenbo, director of the business development department of ShiGeFuKu Jewelry, a well-known jewelry company in Guangdong, which had just spent 600,000 yuan (US$90,530) in decorating its branch at Carrefour Foshan.

"Although our contract with Carrefour has not expired yet, they refused to give any compensation to us. Our last attempt to reach consensus with Carrefour failed, but we will try to contact them again next week. If there is no progress, we will bring a suit against Carrefour, asking for a 900,000 yuan compensation," said Zhang.

Carrefour representatives could not be reached for comments. However, Li Jia, public relations manager of Carrefour South China, was quoted by the Guangzhou-based Time-Weekly newspaper, as saying the store was closed because business was going downhill.

The Carrefour Foshan store officially opened on Feb 5, 2007. With a total area of about 22,300 square meters, the store was the biggest that Paris-headquartered Carrefour established in South China. The supermarket itself covered an area of 8,500 sq m while the rest of the space accommodated a number of other retail outlets.

A shop manager of the I'manfen underwear store in Carrefour Foshan said that sales of I'manfen in the Lotus Foshan store were about three times the sales of Carrefour Foshan. A shop assistant of ShiGeFuKu Jewelry in Carrefour Foshan said the sales there were no match for the sales in the Foshan Walmart.

Although vendors claimed business has always been slow in the Carrefour Foshan store, most shop owners were angry that the store closed during the new year holiday.

"With just one-month notice in advance, we have little time to find our next store. We have never come across such short notice before," said a couple who sell clothes at the Carrefour Foshan store.

Sales for the period from New Year's Day to the 15th day after the Lunar New Year's Day can make up 20 to 30 percent of yearly sales, according to the shop assistant from ShiGeFuKu.

A shop manager of Jinggong Glasses at the Carrefour Foshan store said their losses for the period will be huge.

2010 was a turbulent year for Carrefour operations in China. A store in Dalian was closed in March and another was closed in Xi'an in July.

(China Daily January 7, 2011)