UK supermarket chain Tesco has signed a three-year agreement with French start-up Mistral AI as part of a broader strategy to bolster the use of artificial intelligence in the retailer’s operations.

The partnership will give Tesco full access to the AI company’s commercial models, including any future developments, as well as its AI engineers.

The agreement includes a commitment for the two companies to work together through a new joint AI lab where Mistral AI and Tesco’s technology experts will co-create generative AI technology for different parts of the Tesco business.

Tesco says its approach to AI is focused on improving the experience for its customers, colleagues and suppliers, while enhancing its wider operations. The agreement between Tesco and Mistral will look at a range of areas, including content development and document drafting, speeding up data analysis to provide richer insights, and developing new ways for staff to access information they can use to help customers.

Tesco has doubled the size of its technology team over the past five years in recognition of the huge potential for technology to improve the overall experience for customers. The retailer is already using AI, developed in-house and with partners, across its operations. For example, AI allows Tesco to find the most efficient routing for online orders to create more delivery slots for customers, helps with complex demand forecasting to improve product availability, and is allowing the retailer to engage with customers in an increasingly personalised way through its Clubcard loyalty card.

“By bringing together our retail expertise and Mistral AI’s cutting-edge technology, we hope this partnership could ultimately save colleagues time, improve how we do things and help us to better serve our customers,” said Tesco director Ruben Lara Hernandez. “Innovation has always been part of Tesco’s DNA, and this agreement builds on our extensive track record in developing new technology and AI, in ways that ultimately benefit our customers, colleagues and suppliers.”

Tesco (www.tescoplc.com) is the first major UK retailer to strike a partnership with the European AI player. The start-up has developed rapidly since its launch in 2023 and has customers including HSBC, multinational insurer AXA and car maker Stellantis.

“We are proud to partner with Tesco, a leader in retail innovation,” said Marjorie Janiewicz, chief revenue officer at Mistral AI. “Our applied AI team will collaborate with Tesco’s experts to build customisable, controllable and frontier AI products to improve internal workflows and Tesco’s customers’ experience.”

Mistral AI is a pioneer company in generative artificial intelligence. The company democratises AI through open-source models and products as well as end-to-end infrastructure with Mistral Compute.

Headquartered in France and independent, Mistral AI (mistral.ai) also has a presence in the USA, UK and Singapore.