Chinese Mandarin - Retail: Carrefour China buys from local farms to cut costs

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BIZCHINA / Biz Media Digest

Retail: Carrefour China buys from local farms to cut costs

(Agencies)
Updated: 2007-07-27 14:07

Carrefour SA, Europe's largest retailer, has begun buying agricultural
produce directly from farmers in China to cut costs.

Paris-based Carrefour opened its first China direct procurement center in
Shanghai last week and plans to set up more such centers in Beijing,
Guangzhou and other cities, the company said in an e-mailed statement.

Direct procurement enables Carrefour to bypass wholesalers, reducing
costs and giving farmers a secure outlet for their produce, the retailer
said.

Carrefour's direct procurement comes amid growing concern both in China
and abroad over the safety of Chinese food products.

Carrefour sent inspectors to closely examine water quality at Shanghai
Shatian Lake Ecological Breeding Base before signing a one-year agreement
last week on the supply of prawns -?its first direct procurement contract
in the country, the company said. Carrefour said it would monitor the
entire breeding procedure and would inspect water and feed, to ensure the
quality of the prawns.

Carrefour opened its 100th Chinese superstore earlier this month and
plans to open 20 to 25 stores a year in the world's fastest-growing major
consumer market.

Carrefour, the world's second-biggest retailer, competes for market share
with bigger rival Wal-Mart Stores Inc, which this month is offering more
than 1,000 discounted products at its 80 stores in China.

(For more biz stories, please visit Industry Updates)

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