Auchan Retail and Casino Group have announced they have entered into exclusive talks to build a strategic partnership enabling them to jointly negotiate their purchases in France and abroad with their main multi-national food and non-food suppliers and manufacturers, in compliance with competition rules.
The move comes as Carrefour SA has lost its domestic leadership as France's top grocer to Leclerc, while in late March, Amazon and Casino subsidiary Monoprix announced they are joining forces to bring grocery items sourced from Casino's urban grocery store Monoprix to Prime Now service customers in Paris.
Auchan had sales of EUR52 billion in 2017 and operates its single brand in 17 countries, while Casino had EUR38 billion euros of revenue last year and operates more than 12,000 stores worldwide.
“All the French retailers need more purchasing scale, so this is one way of achieving that,” said Charles Allen, an analyst with Bloomberg Intelligence. He said the potential Auchan pact would cover a smaller share of the French market than did the Intermarche agreement.
"This ambitious partnership will give precedence to subsidiary contracts (suppliers/producers/distributors) while fuelling the development of certain French suppliers in countries covered by both retailers (Western Europe, Eastern Europe, Latin America, Asia)," the statement said.
"This partnership will be in perfect harmony with the commitments undertaken by both Groups in the context of the recent France’s Estates General of Food. It will not extend to traditional fresh products from farming or fishing or French-brand products developed by SMEs or ISEs."
The Estates General for Food was launched last July as an initiative of President Emmanuel Macron to tackle the serious problems facing farmers in France and has as one aim, to give farmers a fairer share of the profits from the food they produce.
The strategic partnership would exclusively cover major national or international manufacturers in the food and non-food industries.
"Auchan Retail and Casino Group will offer their current partners in procurement to join this new dynamic, it being stipulated that Casino Group and Intermarché have now terminated their procurement cooperation agreements in France, by mutual agreement," the statement said.
Under the deal with Amazon, grocery items sourced from Monoprix will be available in the Prime Now app and website through a dedicated virtual store.
Announcing the Prime Now deal, Casino said: "Thanks to this collaboration, Amazon Prime Now customers will be able to access thousands of grocery items sourced from Monoprix: store brand (including Monoprix, Monoprix Gourmet, Monoprix Bio, La Beauté Monoprix), fresh products, exclusivities, etc."
"Thanks to this unique partnership between Amazon and Monoprix, Casino Group reinforces its omnichannel distribution strategy and gets even closer to its customers and their needs. This commercial partnership is a new milestone in Casino Group strategy to innovate ever more for tomorrow’s urban commerce," said Jean-Charles Naouri – chairman and CEO of Casino Group.
Frédéric Duval – country manager, Amazon.fr said: "This commercial partnership, which further enlarges Prime Now service selection, will enable Amazon Prime customers to benefit from ultra-fast deliveries for their Monoprix orders."
Monoprix is a leading urban retailer in France with a presence in more than 250 cities through six banners. The fee for Prime membership is EUR49 per year or EUR5.99 per month and customers can sign up for the Amazon Prime 30-day free trial.