Nisa CEO Michael Fletcher is promising to radically overhaul the buying group’s operating and cost structure in a bid to become more competitive for retailers.
The proposed changes to how the Co-op-owned buying group operates come in the wake of news that Nisa has entered a consultation with some members of staff at its Scunthorpe HQ that could see a reduction of about 50 roles.
Nisa currently uses DHL as a third-party logistics provider to supply customers across the UK from its Scunthorpe distribution centre. This system is regarded by many convenience and wholesale experts as major operating cost and a key challenge to Nisa in ensuring it remains competitive on price.
READ MORE: Nisa considers making 50 head office employees redundant
Fletcher told retailers: “We must change the operating cost of business, and that’s a challenging thing to do and it takes time – that includes both a review of the office function and our relationships with DHL.”
Fletcher also said that more work was ongoing to bring the inbound price Nisa pays suppliers for goods in line with the price paid by the Co-op.
“I think there’s enough value in that pot to fundamentally change the pricing structure of Nisa,” he said, adding that there was also more work needed in making Nisa’s pricing structure simpler to understand.
“It should be very easy to say that this bottled water cost this much money; you shouldn’t be having to get the calculator out and do multiples of reductions and then perhaps surcharges to work out what you paid for,” Fletcher said.
In relation to this simplicity, he promised a fundamental review of the Nisa rebate system.
“We recognise that we fundamentally must restructure our rebate system and it must do more to incentivise loyalty and it must be simpler for partners to understand,” he added.
“I had a conversation the other day where someone told me it’s really difficult to actually understand what the Nisa price is – so we need to make that a lot clearer, and that will help customers make the right choices.”
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