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More and more retailers are merging into shopping alliances in Europe. Recently, the French retail giant Carrefour presented with the corresponding British plans Tesco. Previously, the German Metro had announced cooperation with French Auchan and other dealers under the name of Horizon.
These collaborations are putting increasing pressure on food manufacturers – most recently Agecore, which includes Coop, on Nestlé. The fact that Coop actually removed Nestlé products from the range and that the dispute took place publicly, analysts considered that it was a further escalation. An overview of why more and more traders are banking on alliances and what that means for the end customer. [194559004] What are these shopping alliances doing?
Traders team up to form more alliances. have to the manufacturers of consumer goods. What is new is that they would become more and more international, says a retailer of this newspaper. Throughout Europe, there are now several gigantic alliances. Agecore, which also owns Coop, alone generated about 140 billion euros of turnover in 2016.
Why are there any more and more alliances of this kind?
Commercial alliances reinforce the position of retailers and thus create a balance of power with the international food industry, says Consumer Protection's Josianne Walpen, Increasing alliances is also a sign of 39, a grouping of forces vis-à-vis discounters: Aldi, Lidl & Co., for example, are doing market share to traditional traders. They have built powerful global supply chains by buying a small number of products in large quantities. So, they can push prices.
This is also putting pressure on Swiss retailers: the more Lidl and Aldi are spreading in Switzerland, the sooner Coop will have to adjust its prices to those of discount stores, said Reiner Eichenberger, professor of economics at the University. University of Friborg. Internet competition continues to put pressure on traditional resellers: online retailers like Amazon are reshaping the cards between manufacturers, retailers and consumers.
Through alliances, wholesalers can leverage synergies without actually bonding. Credit Suisse has called this a "step towards mergers without merging". The model of the alliance is similar to that of the airlines with their code-sharing strategy. They share harmonized schedules, baggage handling systems and frequent travelers
What do Swiss retailers belong to?
Coop participates in the Agecore association. These include Edeka (Germany), Intermarché (France), Colruyt (Belgium), Conad (Italy) and Eroski (Spain). Meanwhile, Migros is part of the European AMS purchasing cooperation.
It also includes the Ahold Delhaize Group, one of the largest European retailers, or the British group Morrisons. Compared to other trading alliances, Migros does not negotiate with brand manufacturers within AMS, says spokeswoman Martina Bosshard. These are products that are bought abroad together and then sold as a private label – such as frozen fish, canned goods or snacks.
Have alliances been successful?
The fact that the distributors are stronger means that the dispute of Agecore, which includes Coop, shows the food giant Nestle. Coop has temporarily removed approximately 200 Nestlé products from the shelves to improve purchasing conditions. These products include brands Thomy, Leisi, Mövenpick, Findus and Nescafé. In the end, the dispute was counted as a success for retailers. Industry insiders believe that Nestlé now offers better terms to members of the association: "It is clear that Agecore's demand is very strong," said a retail expert who wanted to remain anonymous after the agreement.
What are the benefits for consumers?
The alliance negotiations could also benefit consumers, says Walpen, from consumer protection – assuming that retailers pass on savings to consumers. That it involves more discounts and permanent price reductions, the same goes for the dealer. Coop had announced after the agreement with Nestlé to pass on price discounts to customers. For two weeks, a big promotion should be made with up to 30% discount on more than 500 Nestlé products. Overall price reductions however were no speeches.
What are the disadvantages of increasing alliances?
As in the conflict between Coop and Nestlé, products could often be missing on the shelves more often. This is because alliances could strengthen the position of retailers and negotiate them with the product stop. However, if the products are cheaper in the stores, this is probably acceptable for most consumers, said consumer protection. "In the end, both parties to the conflict are interested in having the goods on the shelves – this certainly promotes the willingness to compromise."
In addition, only large retailers are included in such alliances. Small suppliers would therefore be forced to continue making purchases at higher prices, Walpen said. "This weakens their competitiveness and ends up favoring concentration in the already highly concentrated Swiss retail sector." On behalf of the Competition Commission (Weko), it is said that this is not a problem. "From a business point of view, it makes sense that traders of similar size and volume of shopping are bundling into a shopping alliance," says Patrik Ducrey, deputy director of Weko. In addition, it is permissible for small traders to create their own purchasing alliance, which some have already done
Are such alliances problematic in competition law?
the Weko. The Weko have so far little practice. Therefore, the Swiss authority is guided by the antitrust assessment of purchase cooperation in the practice of the EU competition authority. "Thus, the restrictive effects of purchase agreements are unlikely when participating operators operate in different geographic markets and can not be considered potential competitors.
Since the other members of Agecore , which Coop owns, are not active in Switzerland, from a Swiss point of view, this is rather harmless, "says Ducrey.The situation would be different if, for example, Coop and Migros appeared in the same alliance of 39th purchase (Tages-Anzeiger)
created: 05.07.2018, 20:18
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