France: Buying and Selling
The most dynamic retailers are undoubtedly the chains of organic shops and superstores, namely biocoop, Naturalia, La Vie Claire and Bio C'Bon, which profited from rising demand for organic products generally in France.
Merger and acquisition activity impacted the competitive landscape: in response to the ongoing price wars. The main trend of the sector has been towards joint purchasing agreements, mainly the creation of mega central purchasing blocs, specifically the alliances between Auchan France and Système U Centrale Nationale on the one hand and ITM Entreprises and Casino Guichard-Perrachon on the other. In 2018, Casino and ITM Entreprises terminated their purchase agreement and Casino merged part of its purchases with Auchan - Système U.
France's retail distribution network is diverse and sophisticated. Setting up of hypermarkets is regulated by the Royer Law of 1973 and the Raffarin Law of 1996. They aim to protect local shops, which are rapidly losing ground to hypermarkets. The Egalim Law of 2018 introduced a mechanism to give back more margin to the producers that has been extended in 2020.
The trend is clearly oriented to smaller outlets, location in the city centre, shorter range of products and easy access. The bigger stores (hypermarkets and supermarkets) are mostly located in the suburbs and outside of the cities, offering larger ranges of products and lower prices.
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Latest Update: September 2024