Frozen food retailer Iceland has called in an operational improvement consultancy to “gatekeep” cost price increase requests from suppliers.
According to The Grocer, Ged Futter, the director of The Retail Mind said the grocer has now introduced a new layer of complexity by requiring suppliers to take requests to Newton Europe for “validation”.
Futter claims the grocer was requiring ready meal suppliers to jump through the “new hoop” but there were concerns the expectation could spread to other sectors.
Newton is almost acting like a gatekeeper,” said Futter. “Suppliers have to go through Newton and Newton will validate.
“Using an external party in this way is quite unusual.
“It’s just a new complexity. They’ve started in ready meals, the category Iceland overtrades in most, but it could spread.”
Newton, run by former Asda CEO Andy Clarke, offers advice to businesses in retail to help businesses stay ahead and maintain profitability amid challenges such as Brexit, Covid-19 and the ongoing cost-of-living pandemic.
Futter added that the expectation that CPI requests should be taken to Newton is causing confusion for suppliers, who fail to understand the validation process.
“Suppliers are confused because Iceland are the ones they go to and now they’re being told to go to Newton, and no one understands how Newton will validate it,” he said.
A spokeswoman for Newton said to The Grocer, it could not share who it was or was not working with due to client confidentiality.
