Chinese internet service provider Tencent and supermarket operator Yonghui are to invest in Carrefour China in a move analysts say will help revive the struggling French retailer's mainland China business, according to Inside Retail Asia.
The three companies plan to work together on data, smart retail, mobile payments and data analysis, the report said.
Jack Chuang, partner with OC&C Strategy Consultants, told the publication the partnership will give Yonghui greater reach into the regions where Carrefour is strong – the north and northeast parts of mainland China.
“Yonghui’s fresh category strength and Carrefour’s import and packaged food offering also complements their respective business well,” said Chuang.
“Carrefour has been struggling in recent year to compete with strong players in the market and have been exploring options to improve its business.”
This is not the first time Carrefour has worked with local players to gain traction in markets – it partnered with Uni-President when it entered Taiwan in 1989 to leverage their local expertise and capabilities, Inside Retail Asia said.
Tencent has already invested in Yonghui to build a more holistic online/offline operation to compete with the Alibaba-SunArt partnership and this deal will expand opportunities for the social media giant’s payment system.
Tencent’s interest in both Yonghui and Carrefour will enable its offline reach to more than 800 stores: 500 of Yonghui's and 320 of Carrefour's, Inside Retail Asia said.