French grocery retailers, Auchan and Système U, have announced a new buying partnership for national and international FMCG brands.
The family-owned Groupe Auchan and Système U, the French cooperative of independent retailers, are the country's fifth and sixth largest retailers.
The new tie-up will not extend to private-label products - accounting for a quarter of overall sales (on average) for the two retail giants.
The announcement is sure to unnerve the A-brand manufacturers as Auchan and Système U prepare to make savings on their FMCG stock, which could then be put into offering customers better prices and promotions.
The two companies will continue to operate their businesses independently despite negotiating better buying terms together.
Auchan said the deal came during "a difficult economic context of value-destroying deflation, with no prospect that would change in the medium term".
@ 2014 ESM - European Supermarket Magazine To receive ESM news directly in your inbox, send an email with the subject ‘ESM news sign-up’ to [email protected].
To subscribe to ESM magazine, please email [email protected].
