Kroger and Produce Payment Terms

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storewanderer
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Kroger and Produce Payment Terms

Post by storewanderer » June 26th, 2018, 10:47 pm

I noticed this come into the news last week in a trade specific website but now see it hit Supermarket News.

Certainly will be interesting to see how this plays out. Produce is a very important department, worth working with suppliers and not pissing them off so you can get the best product. This is already an issue for them. Produce quality has been declining steadily at Smiths since early 2017 (especially fruits).

http://www.supermarketnews.com/laws-reg ... ederal-law

pseudo3d
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Re: Kroger and Produce Payment Terms

Post by pseudo3d » June 28th, 2018, 8:04 am

storewanderer wrote:
June 26th, 2018, 10:47 pm
I noticed this come into the news last week in a trade specific website but now see it hit Supermarket News.

Certainly will be interesting to see how this plays out. Produce is a very important department, worth working with suppliers and not pissing them off so you can get the best product. This is already an issue for them. Produce quality has been declining steadily at Smiths since early 2017 (especially fruits).

http://www.supermarketnews.com/laws-reg ... ederal-law
Even if Kroger violates the federal law, the fine (and Kroger's general size) would basically amount to a slap on the wrist. But if Kroger's relationship with their produce suppliers starts to sour and cause supply issues with produce, which will have more repercussions than whatever the government throws at them.

klkla
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Re: Kroger and Produce Payment Terms

Post by klkla » June 30th, 2018, 3:47 pm

pseudo3d wrote:
June 28th, 2018, 8:04 am
Even if Kroger violates the federal law, the fine (and Kroger's general size) would basically amount to a slap on the wrist.
I don't think so. I'm pretty sure they would get an injunction. This law is taken very seriously.

Even in bankruptcy cases food retailers have to pay farmers immediately.

storewanderer
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Re: Kroger and Produce Payment Terms

Post by storewanderer » June 30th, 2018, 11:28 pm

klkla wrote:
June 30th, 2018, 3:47 pm
pseudo3d wrote:
June 28th, 2018, 8:04 am
Even if Kroger violates the federal law, the fine (and Kroger's general size) would basically amount to a slap on the wrist.
I don't think so. I'm pretty sure they would get an injunction. This law is taken very seriously.

Even in bankruptcy cases food retailers have to pay farmers immediately.
Yes, remember when Haggen was having cash flow issues with its new stores... the produce departments were still very full. That is thanks to this law.

It will be interesting to see how this plays out. If Kroger is successful at somehow getting vendors to agree to Kroger's terms, will other retailers follow? Odd situation.

storewanderer
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Re: Kroger and Produce Payment Terms

Post by storewanderer » July 9th, 2018, 10:07 pm

It looks like Kroger has opted against imposing these terms on produce suppliers. This is probably good to resolve sooner than later since produce is a very important department...

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