Wholesalers, suppliers and retailers are split in their support and opposition to protests at Dhamecha’s London cash and carries over upcoming fees for customers paying with  business cards.

The currently announced rates, due to begin in July, differ by business card type, with the highest being a 1.25% charge on business credit cards.

A further protest is allegedly planned at Dhamecha’s Croydon depot later this week. Previous demonstrations have involved speeches from organisers, picketing depot entrances and abandoning trolleys laden with goods in aisles.

One retailer at Dhamecha’s Hayes depot on 17 June told Better Retailing the protest and boycott was having a visible effect. “Usually at this time the car park is full, today it’s a ghost town, there’s perhaps 15 people inside.”

Who is criticising Dhamecha, and why?

The most prominent voice in favour of the action is Kam Sanghera, managing director of symbol group Select & Save. He wrote: “it’s inspiring to witness the recent wave of solidarity across the retail sector in response to the issue of cash & carry operators passing on credit card transaction costs. For the first time in a long while, we’re seeing genuine unity among independent retailers—and I couldn’t be prouder to stand with you all.”

Hayes retailer and protest organiser Raj Singh shared: “This isn’t just about me or you, this is about all of us. If we accept these new charges from Dhamecha today,  tomorrow every wholesaler will start doing the same. Right now, we still have a choice. But if we stay silent soon we’ll be forced to pay these unfair fees everywhere… We already take on so much just to serve our customers. We cover card payment fees ourselves… If we can do this for our customers, why can’t greedy Dhamecha do the same for us?”

David Wilcock, UK and Europe business manager for drink supplier Shott Beverages suggested the charges aren’t in keeping with Dhamecha’s great reputation. He said: “I’ve always found Dhamecha to be a great business to deal with. They always looked after customers better than the nationals, so this seems a bit odd. Businesses don’t want cash and now want to charge you for paying card. I guess the banks have won.”

One London shop owner wrote in support of the boycott, stating: “As a single shop they can do what they want to us. With thousands of shops, they have to listen. I haven’t used them, and I certainly won’t until this unfair charge is removed.”

UPDATE: Dhamecha ‘reviewing’ fees after shop owner protest at Hayes depot

Support for Dhamecha

Many suppliers and wholesalers who’ve commented on the protests have expressed sympathy with Dhamecha’s position, stating it faced a tough choice between increasing prices for all customers or raising charges on card users to cover the very high transaction charges merchants pay on certain card types.

‘Really unfair’ wrote former Dhamecha category buyer and current national account manager at supplier Vibrant foods Gemma Roberts. She claimed: “The entire team at Dhamecha work tirelessly to ensure the best prices, best availability & best ranges for their retailers. ‘Customer first’ is always is the ethos of the family & this runs right the way through the business.”

Darren Pugh, former head of trading at Dhamecha rivals Lioncroft Wholesale, described the challenges for wholesalers in accepting business credit cards stating: “In most cases [these cards] also give the retailer credit; Who underwrites this? The card company, who passes the charge on the wholesalers through costs. This is still a cheap form of credit if you pay off your card in full at the end of the month, compared to a bank loan.”

“I have huge sympathy for Dhamecha Group in this situation,” said Chris Jones, founder of Paragon Brands, which distributes spirits brands including Zubrowka, Licor 43 and Pusser’s Rum. He explained: “Their net operation margins are below their rivals – Booker and Bestway. This is a policy which has lead them to providing their customers with some of the lowest pricing in the wholesale market but when you operate on razor-thin margins, small changes to your cost structure (such as credit card fees) simply can’t be absorbed.

“I’d venture that if these retailers who are protesting were to add the new fees to their end bill, Dhamecha would still be cheaper than most others.”

Many retailers laid the blame for the charges on stores’ using business cashback and other credit cards increasing Dhamecha’s costs, stating: “Its all thanks to these reward credit cards that people use to pay for their holidays. If your card company is going to charge the wholesaler 3% per transaction, they are obviously going to lay the cost on you or raise their prices.”

“And where do you think the cash and carry gets the money to cover the cost of the charges that they pay the card companies?” said another retailer.

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