Tesco backtracks on fulfillment fee request following supplier pushback

Tesco buyers are “furiously backtracking” after pushback from suppliers over the supermarket giant’s plans to implement a new fulfillment fee.

The Big 4 grocer is attempting to soften its earlier suggestion that suppliers could face range reviews or reduced prices if the refused to comply, The Grocer reported.

Earlier this month, the supermarket contacted suppliers of its intent to introduce new fees to aid in covering the growing costs of operating online.

However, it then said that none of its suppliers would be delisted if they did not agree to the new fees.

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“At Tesco buyer level there has been an awful lot of backtracking going on,” Sentinel Management Consultants chief executive David Sables told the publication.

“There have been plenty of buyers trying to duck out of conversations or saying I’ll refer your concerns to senior management.”

Another source said: “From what I’ve picked up from suppliers, Tesco’s buyers have been stressing that to them, margin is more important than securing this new fee.

“That adds to the theory that this was a way for them to start a conversation, an opening gambit, not the end game.”

Earlier this month, The Groceries Code Adjudicator launched a probe into the supermarket’s new policy over concerns it breaches the Groceries Supply Code of Practice.

Experts previously gave Charged their opinion as to whether Tesco is right to impose a fulfillment charge for suppliers that sell via its online channel.

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