Suppliers can cause market chaos

Although Sugro is seen principally as a wholesale group supplying retailers, it also delivers to many catering and hospitality businesses, said managing director Philip Jenkins.

Sugro has developed business delivering products for vending machines and for wider impulse products to customers such as further education establishments, sports centres and cinemas.

But Jenkins said some suppliers were causing chaos in the market by dealing direct with end users and ignoring existing wholesale arrangements.

Using the example of an un-named crisp supplier, and a bakery customer of Sugro, he said: “This is wrong on a number of levels. First, consultation with Sugro would have meant that both of us were talking to the bakery at the same time with a common goal. Second, they sold the goods cheaper than they were previously being sold so if it was at a lower price who authorised the throwing away of profit and why?”

Jenkins said there were also problems with suppliers having vastly different pricing structures for retail and foodservice, and this was even leading to some major customers rewholesaling deals, and causing more damage to the market.

The way ahead, he said, was for suppliers to work closely with wholesalers, using uniform pricing between the channels.

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