Suppliers and Supply Chain

Strategic partnerships: better prices and more opportunities

In recent years, the DIA Group has entered into a series of strategic partnerships with other operators in the sector with the aim of improving efficiency in all the purchase processes from suppliers, both in terms of negotiations and the actual purchasing process and commercial services. Note that the companies which have set up partnerships (and which are detailed below) continue to manage their commercial strategies completely separately, competing in the markets in a fully independent way, both on a commercial level and in terms of managing their points of sale. In fact, during 2017 no action was undertaken due to causes related to monopolistic practices and against free competition.

• Agreement between DIA Group and Eroski for own-label and national brands: in 2015, both companies agreed on a partnership to improve their negotiating conditions with large suppliers of national and international brands for the Spanish market. While keeping their commercial policies completely independent, the aim is to boost efficiency, which leads to more competitive prices that benefit all customers. The partnership was approved by the antitrust authorities in Spain.
  
  The decision was taken to broaden this agreement in 2017, with the creation of Red LibraTrading Services S.L., a new company whose objective is to negotiate with suppliers of private-label products on behalf of both companies, as well as to acquire other materials and supplies necessary for their activity, with the same aim of maximising value for money for consumers.
  
  Red Libra Trading Services, which employs just over 50 people, started operations in April 2017, operating from Madrid with an initial capital equally split between the DIA Group and Eroski.
• A joint purchasing centre with Intermarché in Portugal: In 2015, the DIA Group and Intermarché (a supermarket banner that includes independent companies) set up a joint purchasing centre under the name of CINDIA, headquartered in Portugal. The negotiating mandate given to CINDIA does not include traditional fresh produce from agriculture or fishing, and neither does it include negotiations with SMEs.
• Agreement between the DIA Group and Casino for negotiations and commercial services: At the end of 2015, and to be applied in 2016, DIA and the French distribution group Casino set up a new company, headquartered in Switzerland, called ICDC Services, which aims to improve the competitiveness of both companies when faced with the large international suppliers. The agreement, which covers both national brands and own-label products, allows both companies to improve their offer to consumers in terms of assortment and price.
  
  This partnership was broadened during 2017 with the creation of a new joint venture, CD Supply Innovation S.L, which is headquartered in Madrid and started operations at the end of December 2017. This company, in which both partners have a 50-50 stake, is in charge of managing certain financial and logistics services, such as payments and sourcing (102-10). In addition, there are plans to create an innovation laboratory to optimise supplier processes and enhance efficiency, ultimately allowing for a better offer for consumers.