Kroger Co. and Walgreens have expanded the companies’ partnership with by jointly forming a group purchasing organization, Retail Procurement Alliance, to provide purchasing efficiencies, lower costs and combine resources to drive innovation.
“Kroger and Walgreens share a commitment to finding value and efficiency improvements by increasing innovation and competition through sourcing,” said Kroger CFO Gary Millerchip. “This concept brings together the best of two great organizations to reinvent critical components of our sourcing practices.”
Millerchip said the formation of the purchasing organization is an extension of the companies’ collaboration launched last year.
Kroger and Walgreens teamed up last year to test a pilot program that makes Kroger products available at Walgreens stores — starting in 13 Walgreens stores in Northern Kentucky.
The companies have since expanded it to add 35 stores in Knoxville, Tenn. Kroger is also carrying a selection of Walgreens health and beauty products at 17 Kroger stores in the Knoxville area.
“Through this unique joint venture, Walgreens and Kroger have the opportunity to use our collective resources to create efficiencies across our supply chains,” said Alex Gourlay, co-COO of Walgreens parent Walgreens Boots Alliance. “This collaboration will also enhance our ability to drive innovation for customers, including both of our private-label brands, to further meet their evolving needs for value and convenience.”