Does Walmart charge slotting fees?
Does Walmart charge slotting fees?
Whole Foods, Costco, BJ’s Wholesale, and Walmart don’t charge slotting fees (though any manufacturer will note that these retailers might aggressively negotiate on wholesale prices instead, or even charge other fees). As a Walmart spokesperson told me, “Unlike many other grocers, Walmart does not charge slotting fees.
When did slotting fees start?
1980s
Introduced in the 1980s, slotting fees were initially only demanded by a few stores. Daniel Lubetzky, the founder and CEO of KIND, recalls slotting fees just becoming prevalent when he launched his brand in 1993.
Is slotting allowance unethical?
In addition to slotting fees, retailers may also charge promotional, advertising and stocking fees. Some companies argue that slotting fees are unethical as they create a barrier to entry for smaller businesses that do not have the cash flow to compete with large companies.
Do vendors pay for shelf space?
Retail shelf space is a hot commodity that thousands of manufacturers want a piece of. Regardless of their company size, suppliers in many food and beverage categories are required to pay a hefty slotting fee in order to get their products stocked on shelves.
How much do slotting fees cost?
Slotting fees average $1500 per store per SKU. If you consider that a range review may introduce 7-12 new SKUs, listing these products in a 1000-store retail chain nationwide has a huge impact on a CPG’s bottom line.
How can I reduce my slotting fees?
Create New Accounts Through a Broker. Not all CPG accounts are created by directly pitching to retailers. Sometimes, products can be placed on store shelves through a broker who has a prior relationship with the retailer. In these circumstances, a broker can reduce the slotting fee on their client’s behalf.
How often do you pay slotting fees?
A slotting fee — sometimes referred to as a shelving fee, or slotting allowance — is a cost that manufacturers pay to place their products on retail shelves. It is a one-time charge that ensures brands will be able to stock a new product until its sales performance can be established, usually within four to six months.
Why retailers ask slotting fees to the manufacturers?
For example, the first, and primary reason why you’d play a slotting fee is that it guarantees you space on the shelf. The result, which is also the second benefit, is that it allows for sales. Not only that, by paying for space on the shelf, you’re able to gain exposure for your products.
Does Walmart sell shelf space?
The product you want to put on the shelf at Walmart must have an active, viable market demand. The product must comply with all laws and regulations covering its category. You may be required to pay a slotting fee to, in effect, purchase shelf space if there is a great deal of competition fighting for the same space.
How do you get shelf space at Walmart?
How do you negotiate slotting fees?
How to Negotiate Your Slotting Fee Down
- Change shelving placement. Placement lower on the shelves is often cheaper than other positions.
- Provide previous sales information. If you have any positive sales numbers to show you may be able to get a discounted slotting fee.
- Measure your sales as they come in.
How do you avoid slotting fees?