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novicetrader1

09/15/12 12:24 PM

#168072 RE: David Gerkin #168067

according to this research, Walmart does not charge slotting fees, but requires discounted pricing from manufacturer, which too me means, they won't stock an item that won't sell. Just my thoughts and here is the link, I only briefly scanned the slotting issue.

Recognizing that slotting involves per unit time compensation for shelf space also clarifies the claim that Wal-Mart does not accept slotting fees. Wal-Mart contracts with suppliers over shelf space, including the provision of particularly desirable promotional shelf space. But because Wal-Mart is compensated for shelf space primarily with lower wholesale prices, the arrangements are not considered slotting contracts.(17)

http://www.justice.gov/atr/public/hearings/single_firm/docs/219950.htm

Older article, so I don't know if that has changed?

Wal-Mart usually insists upon receiving the single best wholesale price that suppliers can offer in lieu of slotting fees. For example, Wal-Mart Chairman S. Robson Walton describes Wal-Mart's policy as "encourag[ing] suppliers to quote us net-net prices . . . . We don't charge slotting fees, and we don't take special deal money, reimbursements to cover double-coupon expenses, and so on." S. Robson Walton, Wal-Mart, Supplier-Partners, and the Buyer Power Issue, 72 Antitrust L. J. 509, 519 (2005). Similarly, a Costco representative testified that "what we do is say, 'are you paying other discounts or what is your menu of discounts,' and if slotting is on there, we want to get the same bottom line . . .. Whether they call it a slotting allowance or advertising allowance or promotional allowance doesn't make a lot of difference." (FTC Report, Eagan Tr. at 61.)