Nisa-Today’s has defended its decision to ask chilled and frozen food suppliers to make cost reductions from next month.
In a letter sent out this week, trading MD John Sharpe asked suppliers to cut the cost of temperature-controlled goods by 20p a case from April 18 on both standard and promotional products. The reductions are to counter Nisa-Today’s investment
in IT and supply chain, including the Premier Service project, which is coming to the end of a two-year roll-out and gives retailers access to chilled and frozen products six days a week.
Nisa-Today’s asks suppliers to support its ambitions so it can avoid raising prices to the public and lessening services.
Sharpe said the market needed initiatives such as this to give consumers freedom of choice and suppliers the opportunity to develop their sales outside the multiples.
Neil Turton, group commercial MD, said as these investments were benefiting suppliers, they should be willing to help pay for them, but added that he was open to discussion. “We have a philosophy of driving a very hard commercial agenda. We have invested in development and growth and we do reserve the right to negotiate with suppliers.”
Suppliers have been angered by the move. One said the proposed cuts would end up costing his company more than £60,000 a year, adding: “It is yet another example of a retailer trying to force through an unnegotiated act.”
Another said he would be disputing the changes and would not accept a flat 20p reduction. “We will be going back to them to negotiate. If they want a reduction in prices they will have to give an increase in volume to compensate.”
Amy Balchin
In a letter sent out this week, trading MD John Sharpe asked suppliers to cut the cost of temperature-controlled goods by 20p a case from April 18 on both standard and promotional products. The reductions are to counter Nisa-Today’s investment
in IT and supply chain, including the Premier Service project, which is coming to the end of a two-year roll-out and gives retailers access to chilled and frozen products six days a week.
Nisa-Today’s asks suppliers to support its ambitions so it can avoid raising prices to the public and lessening services.
Sharpe said the market needed initiatives such as this to give consumers freedom of choice and suppliers the opportunity to develop their sales outside the multiples.
Neil Turton, group commercial MD, said as these investments were benefiting suppliers, they should be willing to help pay for them, but added that he was open to discussion. “We have a philosophy of driving a very hard commercial agenda. We have invested in development and growth and we do reserve the right to negotiate with suppliers.”
Suppliers have been angered by the move. One said the proposed cuts would end up costing his company more than £60,000 a year, adding: “It is yet another example of a retailer trying to force through an unnegotiated act.”
Another said he would be disputing the changes and would not accept a flat 20p reduction. “We will be going back to them to negotiate. If they want a reduction in prices they will have to give an increase in volume to compensate.”
Amy Balchin
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