The Dutch retailers reached a commercial agreement to regain market shares in the Netherlands and Belgium.
Jumbo stores will start selling HEMA products. Several HEMA stores will also become Jumbo stores thereby adding several prime city centre locations to Jumbo’s portfolio. HEMA is also set to become co-sponsor of the Jumbo-Visma professional cycling and skating teams.
HEMA, a household name in variety retail owned by Dutch billionaire Marcel Boekhoorn, looks to decrease its debts through the partnership. The second quarter of this year saw net losses pick up to €14.1 million while they stood at €10.2 million this time in 2018. More details on the agreement are due to be released before 2020.
HEMA was also set to open two pilot stores in the Netherlands in collaboration with supermarket chain Albert Heijn as part of a partnership agreed earlier this year. That plan was abruptly halted earlier this month due to unspecified reasons.
In France, HEMA collaborates with Franprix in Paris and last summer announced plans of an alliance with Walmart in Canada and the US. Overall, the strategy is to boost online sales, open more stores internationally, and to establish a strong brand.
This is not the first retail partnership in Europe this year. In the UK, Marks & Spencer announced its exclusive partnership with online retailer Ocado in March. Across the world harsh times in the retail sector are pushing traditional players towards digital entities to combine strong, household brands with the technological know-how of market disruptors. While the two had long seen each other as competition, they now seem to be aware of each other’s complementary strengths.
Last year, French giant Carrefour entered into a three-year strategic alliance with Britain’s Tesco to form a global purchasing strategy to cut costs for customers and regain market shares at home. This was to be achieved by obtaining better terms from major suppliers and through the joint purchasing of own-brand products and goods not for resale.
HEMA is by no means the first to seek strength in alliances. It will be fascinating to see further detail on the agreement with Jumbo and how this strategy plays out over the coming year.