Belgian retailer Delhaize, part of the Benelux retail giant Ahold Delhaize, has signed a strategic agreement to source fresh fruit and vegetables exclusively from Greenyard subsidiary Bakker Belgium.
As part of the deal, Bakker Belgium will construct a new dedicated packhouse to supply the chain from 2020 onwards, a move that should enable it to handle an expected larger volume of fresh produce.
“We will be more than a supplier to Delhaize,” explained Adrie Bakker, the company's general manager. “Our aim is to add value. Using our expertise in sustainable supply chain management, we will be a partner for both Delhaize and the Delhaize suppliers’ network."
Bakker's Dutch arm has enjoyed a long-standing commercial relationship with grocery retailer Albert Heijn, the market leader in the Netherlands and the largest part of the Ahold Delhaize group.
It is understood Delhaize will continue to priorities the sourcing of fresh produce from Belgium itself, while working with Greenyard to innovate, develop shorter and more efficient supply chains, and improve availability and product freshness.
The new partnership had been in the pipeline for some time following the merger of Koninklijke Ahold and Delhaize Group three years ago.
The retail group has been looking for ways to streamline its sourcing operation and benefit from economies of scale.
"This collaboration looks like a copy of the agreement between Bakker and Albert Heijn," commented analyst Alan Vandenberghe of KBC Securities. "We wonder how other retailers such as Carrefour will react to the closer cooperation between Bakker Belgium and Delhaize."
The agreement with Delhaize represents Greenyard's second major retail supply deal in the space of just a few weeks, coming soon after it announced an agreement in principle with Carrefour Belgium to supply all of its fresh fruit and vegetables year round.
At the end of April, Greenyard Frozen UK entered into a strategic partnership to supply multinational retailer Tesco with a full range of frozen fruit, vegetables and herbs.