Tesco and Carrefour announce partnership

The two retail giants Tesco (UK) and Carrefour (France) have announced a three-year strategic alliance for joint management of their private label brands.

The agreement, which will be formally signed within the next two months, will cover strategic relations with global suppliers and joint purchasing of private label products and non-resale goods.

Analysts estimate that it will bring total purchasing savings of more than $500 million.

The partnership will enable both chains to improve their product quality and assortments in even lower price segments, thereby increasing their competitiveness in the European marketplace.

However, the operation also aims to counter the threat posed by Amazon’s successful entry into the online food market and to improve the two retailers’ competitiveness in the discount segment led by chains such as Lidl and Aldi.

Carrefour has 12,300 supermarkets in more than 30 countries, employs around 375,000 people and closed 2017 with revenues of €88 billion. Tesco has 440,000 employees and 2017 revenues of more than £57 billion. Together they generate annual revenues of €146 billion.