The future shape of grocery e-retail logistics has taken an interesting turn with the signing of an agreement between the French retail group Casino and Amazon.
Casino’s ‘Monoprix’ brand has agreed to establish what is effectively an Amazon storefront, accessible through the “Prime Now app and web site through a dedicated virtual store”.
The marketing strategy appears to be designed to focus on specific customers ordering small quantities or even single items for which Casino/ Monoprix think that Amazon’s website is ideal. Essentially what Monoprix is pursuing is an ‘omni-channel’ strategy. In the words of Régis Schultz, Chairman of Monoprix, the new approach “further differentiates and increases its unique position as urban omni channel leader. Monoprix will benefit from the most comprehensive grocery delivery service in Paris”. For the moment, the service is only available in Paris and its suburbs.
Presumably Monoprix will feed its products into the Amazon fulfilment centres in Paris and utilise the express network created by Amazon to deliver items within a few hours of them being ordered by customers. Bearing in mind that this channel will include the handling of fresh and frozen food products Amazon will presumably have to adapt its systems in Paris to handle this.
The development is notable in light of the fact that Casino has just agreed a contract for the e-retail technology provider, Ocado, to build an automated warehouse and transport system in the Paris region to serve Casino’s Monoprix brand. It appears that Casino’s strategy is for this network to support regular, larger quantity orders, whereas the Amazon interface will service single item orders bought on impulse. It is unclear how the Ocado designed system will interface with the Amazon network.
Elsewhere, Casino has denied reports that it is working with Amazon to adapt its Brazilian operation to provide e-retail services. The company issued a statement that it was continuing to try and find a buyer for its Via Varejo subsidiary.
However, the French retailer did announce that it was in discussions with Auchan Retail, another large French retail group, to establish some form of cooperation in purchasing. Casino explained the reasoning as being “in today’s environment, with central purchasing divisions being restructured and new players emerging on the retail market, this strategic partnership would exclusively cover major national or international manufacturers in the food and non-food industries”.
Essentially, incumbent retailers are consolidating in the face of competition by Amazon.
Source: Transport Intelligence, April 3, 2018
Author: Thomas Cullen
