Coles plans supplier agent cuts

COLES is set to carve out savings worth hundreds of millions of dollars and dramatically cut Australia's 20,000 strong army of independent grocery agents if it proceeds with a radical plan to shake up the way fees are charged to the food manufacturing sector.

The supermarket group is considering wielding its market power to transform the way everyday grocery brands are placed and promoted on its shelves by sidelining independent field agents and creating its own panel of agents to deal with suppliers.

This would make Coles - for the first time - the arbiter of the fees that are charged to suppliers by field agents, while also allowing it to pocket a lucrative rebate in the process.

The plan being considered by Coles management has sent shocks through agent ranks, also known as merchandising reps, whose daily job it is to watch over product on behalf of suppliers inside the store including everything from restocking to replacing price tags.

Field agents are believed to generate about $500 million a year in turnover. This is mostly from fees paid to them by suppliers, with Coles eyeing further cost savings in the supply chain.


Topics:  coles groceries

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