Auchan and Metro Form Private Label Alliance

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October 12, 2010

French retailer Auchan and Metro Cash and Carry have formed a purchasing collaboration to expand their respective private label businesses, according to European reports.

Under the agreement, Auchan is giving Metro Cash and Carry -- the wholesale arm of Germany's Metro Group -- access to its private label supplier network in order for Metro to gain better buying prices. Auchan is reportedly also giving Metro access to its assortment knowledge and quality standards, according to Just-Food.com.

The partnership will enable Auchan to increase its purchase volumes for more favorable pricing and provide it with indirect access to new consumers through Metro’s small independent retailers, Metro Cash and Carry told Just-food.com.

Metro seeks to improve and expand its private label offering at better prices to its customers.

Auchan operates approximately 450 hypermarkets and 650 grocery stores and thousands of small shops in France, Italy, Spain, Portugal and other central and eastern European countries.

SBD Views: The timing of this announcement is interesting as it coincides with media coverage of  Walmart’s plan to leverage their global buying power. Will other regional retailer alliances form domestically and abroad to drive sourcing efficiencies? -- John Failla for Store Brands Decisions

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