Supermarkets, NorgesGruppen | Whale chocolate entrepreneur believes it was squeezed in favor of Nidar

– Politicians don’t have enough balls to tackle this. They just walk away and don’t dare to make good enough rules. Then the business community uses the rules they have, Rolf Rune Forsberg, founder of the Hval chocolate factory, tells Nettavisen.

The online newspaper wrote on Wednesday about how some of Norway’s largest grocery suppliers, such as Orkla, Freia, Ringnes and Mills, are accused of differential treatment.

This comes in the wake of revelations that Norgesgruppen, which is by far the largest grocery group in Norway, with chains like Kiwi, Meny and Spar, has for several years been able to buy the same products at a much higher price. lower than its competitors Coop and Rema.

Kolonial.no CEO Karl Munthe-Kaas believes this is part of an agreed deal in which Norgesgruppen receives lower prices in exchange for denying shelf space to smaller competitors from large suppliers.

– They can more credibly threaten to take, for example, Ariel detergent and make it a new brand in Norway. Therefore, Lilleborg (which is owned by Orkla, journal. Note) has to give Norgesgruppen a reasonable price, Munthe-Kaas said, among others.

Read more here: Races Above Differential Treatment: Highlights Freia and Orkla as Two of the Worst

I think they were squeezed

Rolf Rune Forsberg, director of the Hval chocolate factory, says that they, as small suppliers, have experienced exactly this, that is, they have been squeezed in favor of the large suppliers.

Hval competes with two of Norway’s largest grocery suppliers, Nidar, which is owned by Stein’s grocery giant Erik Hagen, Orkla, and Freia, which is owned by the world’s leading Mondelez group.

– Yes, they used us in this game. In the same way that Nidar has been threatened to provide better conditions so that smaller suppliers are not accepted. We have entered Norgesgruppen stores, only to be dumped again when Nidar has given them better terms, he says.

Bård Gultvedt, director of trade policy and government contact at Norgesgruppen, rejects Forsberg’s claim.

– We do not acknowledge your allegations of conflict with competing chocolate suppliers, he tells Nettavisen.

– Norgesgruppen has more than 1100 suppliers. Our goal is the best possible collaboration with all suppliers. But in the end, it is the customer who decides which items end up in the shopping cart, he adds.

Gultvedt also says that they have had a good collaboration with the Hval chocolate factory for several years.

– We are one of their biggest clients, and this year we have a very good growth in the sales of their products, he says.

Also read: harsh accusations of abuse of power against the food family that owns Meny and Kiwi

Believe that supermarket chains decide

Nidar is owned by Orkla, and Nettavisen has also confronted Orkla with Forsberg’s remarks.

– We do not have the opportunity to comment on the specific negotiations that we have or have had with the grocery chains. But overall, I can say that Orkla companies negotiate on their behalf, says Håkon Mageli, Orkla Executive Vice President Communications and Corporate Affairs.

– It’s the supermarket chains that decide which products will get shelf space, he says.

The Nidar factory in Trondheim delivers almost all of their production to the Norwegian market, so it is important for them to have their products in both Rema, Coop and Norgesgruppen stores.

– It is important for us to be competitive in the three supermarket chains, and we do not benefit from too large price differences in their purchasing conditions, he says.

– Unreasonably large differences

Forsberg says Hval gives all chains a level playing field, because they believe it doesn’t matter whether a chain has 25 or 40 percent of the market.

– Although a chain with about 25 percent of the market, for example Rema 1000, has a smaller selection than one with 40 percent of the market, they often buy the same volume of products, he says.

Forsberg at the Hval chocolate factory believes that the Norwegian Competition Authority found surprisingly large differences in the purchase prices Norgesgruppen receives versus Coop and Rema.

– I think there are unjustifiably large differences. It’s hard for me to understand that it could be like that, he says.

As long as there is no prohibition on discriminating against chains, for example, Norgesgruppen can bargain as much as it wants on prices. Here, he believes that better regulations are needed to make it possible to reduce the large differences shown by the report from the Norwegian Competition Authority.

Also read: If you choose these items, you can save more than 5000 crowns in one year (+)

– Dictate prices

Bjørn Takle Friis at Coop believes, however, that not only the suppliers, but also Norgesgruppen is a small problem.

– Norgesgruppen is so big and has so much power over the suppliers that in many cases they dictate the prices. Many providers fear the consequences of speaking out against them, he says.

He believes that this hurts the competition in the grocery market and becomes a disadvantage for customers.

– They have such great advantages on the purchasing side that they have a different competitiveness than we and the other players have. If Coop had had similar or close purchasing conditions to Norgesgruppen, it would have been cheaper to buy food in Norway, Friis says.

Also read: Now Kiwi is bigger than Rema 1000, it is the largest supermarket chain in Norway

Kolonial.no CEO Munthe-Kaas says Norgesgruppen is free to use its power against suppliers, but believes that it is obvious that the differences that suppliers give to chains hurt competition.

Among the smaller suppliers, the same problem is not found, since they do not have the same power as the large ones because the chains can do without a small supplier.

– Strong competitor

Gultvedt at Norgesgruppen comments on Friis’ remarks.

– Coop is a strong competitor with 30 percent of the grocery market. They are free to think what they want. We do not know what conditions Coop or other competitors of its suppliers have, and it should be, he says.

He notes that the Norwegian Competition Authority has examined 16 out of a total of more than 1,000 suppliers, and that the report only says they have better terms from some suppliers.

– There are also suppliers that offer our competitors better conditions than the ones we obtain. The report does not draw any conclusions about the much better conditions Norgesgruppen has compared to its competitors, it says.

Gultvedt says his job is to negotiate the best possible terms, regardless of the competition.

– Annual negotiations consist of negotiating price increases from suppliers, in order to offer attractive prices to consumers.