Metcash agrees supply deal with Foodland

Metcash Limited has signed a legally binding Heads of Agreement with Foodland Supermarket, the companies announced today.

Foodland Supermarket is the governing body for independent Foodland supermarket retailers in South Australia (SA).

The deal includes the proposed form of a long-term supply agreement. The agreement means Foodland retailers will commit to being supplied from Metcash’s proposed new distribution centre in SA for a period of ten years. The agreement is conditional on Metcash entering into an agreement for lease for the new distribution centre by December 21.

As per Metcash’s announcement on May 28, 2018, the agreement does not include Drakes Foodland supermarkets in SA.

Metcash has also signed long-term supply agreements with Foodland multiple-store owners. These include Romeo’s and Chapley’s, as well as the remaining members of the Foodland Supermarket Board, who are owners of Foodland supermarkets in SA.

The company has other existing fixed-term supply agreements with Foodland and IGA supermarket retailers in SA. In addition, Metcash now has long-term supply agreements with retailers representing most of its supermarket sales in SA (excluding sales to Drakes Foodland supermarkets).

In the meantime, Metcash and Foodland Supermarket are progressing their 10-year supply agreement with the remaining Foodland retailers in SA. Most are single-store owners.

Metcash also enjoyed a jump in share price yesterday after releasing its AGM presentation.

Similar Articles




Most Popular

Industries most impacted by COVID-19

In mid-March over 60% of Australian businesses report being affected by the COVID-19 coronavirus.This is up from a massive 45% points from a month...

Spotlight on Australia’s supermarkets and grocery industry

By Jessica Mudditt.IBISWorld’s ‘Supermarkets and Grocery Stores in Australia’ report describes Australia’s supermarket and grocery industry as “fiercely competitive” and highly concentrated. ALDI’s rapid...

The bakery behind ALDI’s own brand

As ALDI expands into new Australian markets, the retailer is forging new partnerships with suppliers that can meet the high standards of its exclusive...