Nisa has pledged to improve its wholesale pricing (WSP) after admitting “issues” that meant it was cheaper for partner stores to buy some Co-op-branded goods from their local Co-op store.
In a message sent to partners seen by Better Retailing, the wholesaler said it was investigating the discrepancies following dozens of complaints by retailers last month.
It said: “These issues have arisen recently due to some centralised investment that Co-op have put into their proposition. This investment has not been supported by any reductions in cost prices from suppliers and has therefore not been available to Nisa.
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“However, we are currently looking into all of these Co-op brand pricing issues with a view to improving our wholesale pricing position for partners wherever this is possible.
“This work is ongoing and we will be communicating the details of any wholesale price changes we will be making in the coming days.”
Better Retailing analysis found a number of Co-op own-label products where the single unit WSP for Nisa retailers was more expensive than if Nisa stores bought the same goods from a Co-op store.
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This included 450g Irresistable Lean Beef Steak Mince (£4.64 WSP/£4 Co-op), 8 x 500g carrots (45p WSP/42p Co-op), 500g Penne (67p WSP/ 58p Coop), 1.5kg Plain White Flour (£1.06 WSP/70p Co-op) and 250g Baby Plum Tomatoes (£1.04 WSP/85p Co-op).
The analysis of the discrepancies included VAT, but excluded promotional benefits for Co-op members discounts and Nisa rebates.
Some Nisa partners told Better Retailing the difference in pricing had affected their ability to remain competitive.
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One store owner, who asked not to be named, said: “The differences are predominant through the entire shop and Nisa is deemed more expensive than Co-op.
“In a basket analysis, the customer is better off going to a Co-op than a Nisa. There are lots of product categories where you’re barely or not even making a profit, such as the multibuy deals on fresh and protein.”
Another Nisa retailer added: “The wholesale pricing of own-label since Coop took over Nisa has gone up gradually by between 1.5% and 2% on average.
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“The changes have been incremental and each time Nisa recommend you sell it at a higher RRP to maintain the margins, but the RRP in Co-op stores hasn’t changed accordingly.”
When asked by Better Retailing about the issues, a Nisa spokesperson said: “Nisa is committed to continually enhancing the partner proposition and, as such, we are currently looking to improve our WSP position on a certain number of lines. This work is ongoing and we will be communicating the details of any WSP changes we will be making to partners in the coming weeks.”
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