Carrefour Group is making a billion-dollar bet in the mass-to-class game, and it has lined up BCBG to place it.
Carrefour and BCBG Max Azria Group are expected to reveal today that they have inked a deal for the apparel firm to showcase a new collection in the women's ready-to-wear category at Carrefour hypermarkets in France, Greece, Spain, Belgium, Italy and Portugal. The new line, still unnamed, is set for a fall-winter 2007 launch.
"This is a fantastic challenge. It is a wonderful thing to know that we are going to dress millions and millions of women who cannot afford BCBG. The collection is very extensive. We will have 300 styles every quarter [under] this agreement," Max Azria, chairman, designer and chief executive officer of BCBG Max Azria Group, told WWD exclusively.
Terms of the deal were not immediately available. Industry sources familiar with the arrangement said that the deal, which ends Dec. 31, 2011, has a minimum guaranteed volume of 1 billion euros, or about $1.3 billion, over the course of the contract, plus escalation per season.
A source close to Carrefour said about 450 of its hypermarkets initially will sell the line. The six countries named make up the bulk of the Carrefour operation, but the expectation is that after a year the line will be expanded to other Carrefour doors in different markets, the same source said. Carrefour is the world's second-largest retailer after Wal-Mart.
"This collaboration with an internationally renowned fashion company is integral to the Carrefour Group strategy to further develop its sales in the nonfood sector," Jose Luis Duran, chairman of Carrefour's board, said in a statement.
According to Azria, the two companies began working on the project a year ago, and the designs for the 2007 fall-winter launch are already completed.
Ben Malka, president of BCBG Max Azria Group, observed, "Carrefour is number one in food because it gives incredible choice, and great product at great prices. It is the best place to go to buy food. We see that the idea of low price is not [necessarily] the favored format in retail. We are looking at offering the best value at the best price."
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