Amazon in French food deal

Amazon has made further inroads into food retail in France as Casino’s upmarket Monoprix chain became the first local retailer to agree to sell groceries via the US e-commerce giant.

The move, which is set to shake up the competitive French food retail market, lifted Casino shares as much as 9.7% in morning trade on Tuesday amid speculation that it could lead to a bigger deal later on.

Amazon’s purchase of the bricks-and-mortar retailer Whole Foods Market for $13.7bn in 2017, and a deal for Amazon Prime to sell products from the British supermarket chain Morrisons, raised expectations that it would bid for a retailer or form a partnership in France.

Casino and Amazon said on Monday that groceries sourced from Monoprix would be available in the Amazon Prime Now app and website through a dedicated virtual store.

The deal is limited to the lucrative Paris market and its suburbs, though Monoprix CEO Regis Schultz said that an extenMelrose sion to other parts of France could not be ruled out.

Asked if the partnership paved the way to other deals with Amazon, Schultz said: “We do not discuss the future.”

Monoprix is one of France’s best-known store chains, with a network of nearly 800 upmarket stores in more than 250 cities. It has a strong focus on quality and fresh products in the mould of Whole Foods and is a major contributor to Casino group profit.

“We consider the Monoprix product selection as exceptional,” Amazon France CEO Frederic Duval said.

Financial terms were not disclosed, but Schultz said a model where Monoprix picks the order in store and Amazon takes care of delivery was a “profitable” one for Monoprix.

Casino already has a delivery partnership with UK online retailer Ocado, signed in 2017.

The two deals were complementary as the Ocado technology will allow Monoprix to tackle the needs of its traditional clients with a bigger basket and seeking next-day delivery.

Clients of Amazon Prime, set up in Paris in 2016, are looking for fewer items and want express delivery.

Since the purchase of Whole Foods Market, expectations that Amazon could focus next on Europe have spurred French retailers to try to improve their own online offerings.

Carrefour announced in January that it would invest €2.8bn in digital commerce over the next five years, six times its current investment.

Leclerc, France’s biggest food retailer by market share, privately held operator Systeme U and Casino have all been linked in recent months with Amazon, which has steadily been building its presence in the country.

Leclerc launched its own home delivery service in Paris on Monday.

MONOPRIX IS ONE OF FRANCE’S BEST-KNOWN STORE CHAINS, WITH A NETWORK OF NEARLY 800 STORES