Metcash is facing an apparent backlash from independent IGA retailers over plans to reduce the product range available in stores and changes to promotions.
According to correspondence between Stone Advisory (a representative group established by IGA retailers) suggested a distrustful relationship had been blooming between Metcash and its customers, who have seen their market share fall by more than half in 10 years.
In a letter sent to IGA retailers, Stone Advisory said: “Many initiatives Metcash is proposing threaten the independent character of our business and risk to undermine our long term goals” the Australian Financial Review.
C&I spoke to Metcash regarding the issue.
Metcash CEO of supermarkets and convenience Scott Marshall said: “The letter referred to is an old one and not indicative of where we are now with the initiatives. We are working well and making good progress with both our retailers and Stone Advisory on initiatives that strengthen our independent retail network. We are pleased that we have recently reached agreement on Mini DSA / range rationalisation, and implementation plans are being finalised”.
“IndieDirect is in trial and is expected to deliver significant efficiencies for our retailers and suppliers through automating processes,” Mr Marshall said.
“The roll out of IndieDirect will only occur when we are satisfied that our trials have been successfully completed and we can show our retailer partners the benefits. We are committed to implementing what works for our retailers, and this includes adjusting our programs as the need arises.
“I believe the dynamics of our operating model are such that maximum benefits are delivered through continual retailer input, alignment and flexibility. This is how I will be operating with our retail partners.”