Mercadona has bought the company that has been supplying pallets and boxes for decades. And there is a very simple reason

Let Mercadona monopolize 30% of the supermarket business is no coincidence. The success of Juan Roig’s chain responds to a cocktail in which, among other issues, its bet on white labelsthe ready to eat dishes and geographic dispersion. Another key to that equation is your supplierswho are responsible for supplying you from cheeses or kebabs to services. Now the chain has decided take the reins from one of those external firms, Logifruitthe same one that has been supplying it with boxes and pallets for decades.

There is a word that explains it: logistics.

What has happened? That Mercadona has decided to take over the Valencian company Logifruitone of the key suppliers of its logistics, since it supplies it with the boxes and pallets it uses to transport goods.

It has been the Valencian chain itself that has been in charge to announce the acquisition, although without revealing the amount or the dates. In your statement Juan Roig’s company simply emphasizes the importance of the purchase for its internal operations and advances an important piece of information: the 1,600 Logifruit employees will join Mercadona’s team directly.

What is Logifruit? A crucial piece in the functioning of the Valencian chain. The company was founded in 1996, has 16 logistics platforms and manages more than 18 million of boxes, boxes and reusable pallets designed for the transport of goods. Its network of facilities is spread across a good part of the peninsula, with 14 nodes distributed throughout Spain and two others in Portugal.

Is it just another supplier? No. And not only because your rental model of reusable packaging has earned it a strategic role in Mercadona’s structure. Unlike other suppliers of Juan Roig’s company, which maintain extra business avenues (even if they are minority), the history and work of Logifruit is closely linked to that of the supermarket chain.

The company itself explains on his website which started in 1996 as a “logistics operator to provide service to Mercadona’s fruit and vegetable suppliers.” Almost 30 years later, that link remains key for both companies.

Why’s that? By defining your “interest groups” in the sustainability report 2023, Logifruit identifies the five major actors that shape its business: the workforce, the companies that supply materials, machinery and services, society as a whole, capital and customers. And among the latter he specifically cites two: Mercadona and its suppliers.

In fact, although Logifruit talks on its website about “more than 1,095 clients”that ecosystem seems to basically pivot around Roig’s chain. The diary Five Days assures that, in its latest financial report, the box and pallet company recognizes that it did not have “other clients outside of the pool of services established for Mercadona and its suppliers”. At least by the end of 2024.

Do we know anything more about the company? Yes. And it helps to better understand the movement that Mercadona has just made. Last year Logifruit invoiced around 164 million of euros (7% more) and obtained a net profit of 5.2 million. Its assets amount to 22.3 million and its liabilities include debts with financial entities, although most of them mature in the long term.

The other piece of information that helps understand Roig’s movement is that in 2024 the company rented packaging worth 54 million euros to Mercadona and its suppliers, according to the documentation consulted by Five Days.

What does Mercadona say? That the purchase will help it achieve two of its “objectives”: “unify all its logistics processes” and “continue consolidating the efficiency and sustainability of its distribution network.” “The agreement, pending approval by the Competition agencies and the corresponding administrative authorizations usual in this type of operations, will allow Mercadona to capture important synergies and further optimize its resources,” the Valencian firm stands outwhich hopes to “strengthen” its assembly line.

And Logifruit? Logifruit also highlights the historical link between both companies. “When we began our collaboration with Mercadona, in 1996, we took on the challenge of offering a service that met their needs and gave them competitive advantages. Three decades later, I am proud to be able to say that Logifruit has overcome that challenge,” celebrates its president.

In its financial report the company itself recognized that it would be “complicated” for Mercadona to find a substitute capable of supplying boxes and pallets in the short term and that this operation would also require a high investment.

Is it something exceptional? Yes. And no. In addition to his commitment to the white label, the prepared food and geographical dispersion, Mercadona’s commercial success relies heavily on its network of suppliers. Although it is not common, this is not the first time that he has decided to integrate into his structure one of those companies that help him articulate his business. It already happened in 2010 with the Caladero packaged fish company, although years later he sold it to Profand.

Images | Logifruit 1 and 2 and Andalusian Government (Flickr)

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