Suppliers must refuse to be “bullied” into not supplying discount retailers by the sector’s giants, Aldi UK and Ireland group managing director Paul Foley said yesterday.
Speaking at the BRC annual conference in London, Foley said that while many retailers are upping the pressure on suppliers, the price of goods was as much to do with the cost base of the retailer involved as with the price paid to the supplier.
“Suppliers who are bullied into believing that low-cost base businesses can be stopped are going to ruin their own businesses,” Foley said. He added: “The price charged for an item needs to make sense for everyone involved. There are decisions being made in the grocery supply chain that aren’t making anyone any money.”
Foley stressed that Aldi’s success wasn’t just down to its low prices but also the quality of the product. “Price is only 50 per cent of the equation – the holy grail is value,” he said.