French retail giants Auchan, Casino and Schiever have agreed to form a new purchase alliance with German Metro, named Horizon. This new alliance will allow the chains to coordinate purchases both inside France and abroad.
Ready for 2019
Horizon should enable the founding members to "negotiate in a more collaborating, balanced, and innovative way", rather than simply aimed at transactions. The four companies assure suppliers that the allies would increase the pressure, a press statement says: rather, they promise to "guide small enterprises in their international development". The four want to be ready to negotiate together in the 2019 talks, but are awaiting the verdict of the French competition watchdog that should arrive on 18 July at the very latest.
Auchan and Casino had started their talks early this spring, while Metro and Schiever joined in later. The four have made agreements on relationships in three areas: international brands, national (French) brands and the agricultural sector. Small enterprises and individual farmers would still have to deal with the separate companies however. The four retailers will concentrate their negotiations with international retailers in Genève, Switzerland, while they will also streamline their private labels and cut general costs.
French retailers have been seeking alliances for a while now: Carrefour and Système U have forged an alliance as well, while the same Carrefour also struck a deal with British Tesco. All of them fear the competition that Amazon will bring when it starts to really focus on delivering groceries in France.