Tesco and Carrefour to agree joint purchasing deal

Tesco and global retail giant Carrefour are set to enter a long-term strategic alliance designed to help the businesses lower prices.

The companies said the deal – which they hoped would be formally agreed within the next two months – would cover the strategic relationship with global suppliers, joint purchasing of own-brand products and goods not for resale. The alliance would have a three-year operational framework.

Carrefour is one of the biggest grocery retailers in the world, with around 12,300 stores operated under Carrefour Group banners in 30 countries. The Paris-based business boasts a turnover of almost €90bn.

In a statement issued by both businesses today (2 July), they said the alliance would enable them to lower prices while improving the quality and choice of products.

“This agreement will also allow both companies to strengthen their relationships with their suppliers and create significant opportunities for those suppliers,” it stated. “Each company will continue to work with supplier partners at a local and national level.”

Carrefour Group chairman and CEO Alexandre Bompard said the deal would combine the “purchasing expertise of two world leaders”, adding the businesses had complementary geographies and common strategies.

“This agreement is a great opportunity to develop our two brands at the service of our customers.”

Tesco Group chief executive Dave Lewis said he was “delighted” to be entering the alliance.

“By working together and making the most of our collective product expertise and sourcing capability, we will be able to serve our customers even better, further improving choice, quality and value,” he added.

This is the latest announcement in string a deals that are reshaping the UK grocery landscape and buyers’ relationship with their suppliers. In January, Tesco and Booker announced a £3.7bn merger, while Sainsbury’s and Asda recently revealed plans to merge.

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