Elaine Watson
Musgrave could drive like-for-like sales growth at Budgens by another 4% if suppliers let it compete on a level playing field with the big boys, delegates were told at the Budgens supplier conference in Warwick.
Budgens' like-for-likes are "better than Tesco's on food alone, and more than double Safeway's," claimed chief executive Martin Hyson, while sales per square foot in some stores topped £23.
Trading director Cliff Goodman said: "We don't want any favours; all we want is a level playing field. The answer to why you should reduce your cost of goods to Budgens is clear. It will give you better returns than investing in the big four."
Tesco was already turning the screw on T&S suppliers for better terms, he said, while the fact that Budgens was now a private company meant suppliers at least had security of terms. "We are aiming to double the size of our business in five years, and we are part of a company four times our previous size. But we don't want rewards for volumes. What we need is fuel for growth."
Budgens was seeking all available efficiencies through EDI ordering and invoicing, backhauling, centralised distribution, and local discipline on PoS material, promotions and ranging.
Suppliers were asked to sign and return forms confirming that they would present Goodman with a business plan for 2003 that: "closes the 11.1% cost price disadvantage" Â the alleged differential between cost prices charged to Tesco and to Budgens on leading brands; "increases investment to reflect growth opportunities"; and "improves terms in line with the new enlarged group".
Musgrave UK executive chairman Eoin McGettigan said Musgrave had doubled the size of its business every five years for the past 25 years, and he was confident it could do the same for Budgens, with investment in more refits, new stores and the Budgens Local proposition.
But lousy terms put a comparatively small, but highly efficient company on a "hiding to nothing. We are asking for transparency," he said.
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Musgrave could drive like-for-like sales growth at Budgens by another 4% if suppliers let it compete on a level playing field with the big boys, delegates were told at the Budgens supplier conference in Warwick.
Budgens' like-for-likes are "better than Tesco's on food alone, and more than double Safeway's," claimed chief executive Martin Hyson, while sales per square foot in some stores topped £23.
Trading director Cliff Goodman said: "We don't want any favours; all we want is a level playing field. The answer to why you should reduce your cost of goods to Budgens is clear. It will give you better returns than investing in the big four."
Tesco was already turning the screw on T&S suppliers for better terms, he said, while the fact that Budgens was now a private company meant suppliers at least had security of terms. "We are aiming to double the size of our business in five years, and we are part of a company four times our previous size. But we don't want rewards for volumes. What we need is fuel for growth."
Budgens was seeking all available efficiencies through EDI ordering and invoicing, backhauling, centralised distribution, and local discipline on PoS material, promotions and ranging.
Suppliers were asked to sign and return forms confirming that they would present Goodman with a business plan for 2003 that: "closes the 11.1% cost price disadvantage" Â the alleged differential between cost prices charged to Tesco and to Budgens on leading brands; "increases investment to reflect growth opportunities"; and "improves terms in line with the new enlarged group".
Musgrave UK executive chairman Eoin McGettigan said Musgrave had doubled the size of its business every five years for the past 25 years, and he was confident it could do the same for Budgens, with investment in more refits, new stores and the Budgens Local proposition.
But lousy terms put a comparatively small, but highly efficient company on a "hiding to nothing. We are asking for transparency," he said.
{{NEWS }}
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