Marks & Spencer is to charge its food suppliers for product wastage under its new Project Genesis trading terms.
A document outlining the details of the changes, obtained by The Grocer, says M&S will order suppliers to help pay for "abnormally high levels of waste" in any category.
The document also confirms press reports M&S has levied a 2% discount on prices across the board and introduced discounts of up to 3.5% based on how much a supplier's sales through M&S grow. In addition, M&S will levy a flat rate 1.5% central marketing charge.
Tim Kershaw, director of supply chain consultant Libra Europe, said suppliers would consider the wastage charge harsh. "Waste is entirely driven by the retailer. Order size, tray and case size, rate of sale, shelf-stock level are all set by the retailer. If M&S get this wrong, the supplier pays for the retailer's incompetence."
But M&S insisted it would not expect suppliers to pay for wastage if it were not their fault - and any instances of wastage would be considered on a case-by-case basis.
"Where it's our responsibility we'll continue to pick up the cost," said a spokeswoman. "We will deal with this in a grown-up way."
M&S was also encouraging suppliers to join its vendor-managed inventory programme, she said, under which suppliers took responsibility for forecasting demand and availability. In such cases, there would be pre-agreement that the supplier would also take on at least some of the cost of any wastage.