Bucking the trend
It seems, however, that the more recent entrants to the market — which represent a new wave of grocery stores that focus on fresh perishables and a more pleasant in-store experience — are forgoing this practice.
Whole Foods Market, Inc. (NASDAQ:WFM), The Fresh Market Inc (NASDAQ:TFM), and New York-centered Fairway Group Holdings Corp (NASDAQ:FWM) have all decided not to use slotting fees to supplement their income. Instead, these stores focus on selecting the products they think will best fit their customers’ needs.
Oddly enough, there’s a fourth member of this no-slotting-fees club, but it doesn’t fit the “new wave” label like the other three: Wal-Mart Stores, Inc. (NYSE:WMT). The company has such clout that by virtue of its ubiquity in the market place, it is able to negotiate with food companies for the lowest possible prices to pass on to its customers.
The article The Hidden Profit Machine for Grocery Stores originally appeared on Fool.com.
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