Edeka accused of abusing its buying power

The German association of brand manufacturers, Markenverband, has reportedly lodged a complaint at the Federal Cartel Office against the country's leading grocer Edeka, publicly accusing it of abusing its market power. Edeka's efforts to harmonise its buying conditions after integrating former Tengelmann-owned discount chain Plus into Edeka's Netto Marken-Discount would mean an "existential threat" for many brand suppliers, Markenverband said in a note to the press. Numerous suppliers would depend economically on Edeka. According to Lebensmittel Zeitung, Edeka has been asking not only for the common 'wedding bonus', but also for distribution, partnership and synergy bonuses, partly with retroactive effect, concerning sums of up to 10% of the total volume negotiated by a supplier with Edeka. Apart from that, Edeka is also aiming at extended payment terms. Edeka's head of sourcing, the former Lidl buyer Gert Schambach, has justified the claims by the much stronger presence of brand in Netto stores. Netto discounters generally offer a broader range of manufacturer brands than Plus did. It is understood that the co-operative requires significant means to finance not only the acquisition and conversion of the 2,340-store strong Plus network, but also the extra payout designed to gratify its independent retailers, who will have to face more inhouse competition from an enlarged Netto.