The Grocer's exclusive report that Sainsbury and Tesco are planning to introduce ex-factory gate pricing across all categories (The Grocer, November 3) has sparked a frenzy among suppliers. The IGD has been inundated with questions as it prepares an industry guide to the practice, which takes delivery out of the suppliers' remit. The IGD will launch a handbook to ex-factory gate pricing at an IGD conference on backhauling and factory gate pricing on February 21. At least 360 delegates, triple the number anticipated, will attend, with speakers representing Sainsbury, Tesco and Safeway and logistics expert Exel. IGD Business analyst Neil Finegan said: "Many suppliers do not know how ex-factory gate pricing will affect them. They say they want more information from retailers on costs and mechanisms." Sainsbury and Tesco are both negotiating with manufacturers for reduced charges if they collect their own stock. Sainsbury supply chain director Martin White said: "We operate ex-factory pricing on chilled and produce and we are having one to one meetings with suppliers to extend the system to ambient. "We need a new supply chain structure to drive up efficiency and volumes." White said Sainsbury's suppliers would need to run seven days a week to drive distribution efficiencies as it implemented the new 24/7 regime. But he added: "We will never buy 100% ex-factory gate, there are other ways to get products to depot like backhauling." The IGD's Finegan said the ex-factory gate pricing regime "could potentially bring some big wins for small suppliers, but some bigger suppliers who already have a transport infrastructure might have a problem". National Farmers' Union senior marketing adviser Stuart Thomson said: "Anything which takes costs out of the supply chain by creating greater efficiencies is a good thing, but we need to clarify what the cost savings are and who will benefit." l See Focus on Logistics, p56 {{NEWS }}

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