Legislation Changes for Supermarket Chains

Date: 20/09/2012 Comments: 0
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Legislation changes for protection of competition are expected to be made within the next month. This should result in resolving the issues between manufacturers and supermarket chains, announced the Minister of Economy, Energy and Tourism Delyan Dobrev. According to his words the changes will be suggested by branch organizations and then there will be a vote for or against them. The executive director of the alliance “Made in Bulgaria” Plamen Grozdanov, comments that by insisting on clearer regulations, the manufacturers do not wage a war against the supermarket chains. Their aim is to ensure that everybody on the market has the same market privileges.

Manufacturers have been alarming for quite some time that the supermarket chains impose on them hardly achievable conditions. According to Plamen Grozdanov, in the contracts between manufacturers and supermarket chains there are a lot of planned discounts which influence negatively manufacturer’s profit. He claims that these discounts sometimes reach 40-50%, which greatly decreases the expected profit. The supermarket chains require from the retailers “Entry fee”, because of the investment made by the chain when opening a new store. The fees are calculated on retail space basis and start from 500lv. and can go up to 5000lv. Some manufacturers have already gone bankrupt and there are warnings that if the situation does not change there will be many more bankrupts to come.

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