Coles supply chain revamp to go ahead
A letter sent to Coles' suppliers this week reveals the supermarket chain has chosen marketing services companies Crossmark and AMC to be its first "preferred providers" of merchandising services in its stores.
The new system will start before the end of the year, with suppliers not wishing to hire Crossmark and AMC required to have their merchandising agents undertake an accreditation course.
In its letter to suppliers, Coles' supply management team says the supermarket has developed the new structure for merchandising reps to reduce disruption in the stores and provide a better and lower cost service to suppliers.
"As you are aware, there are up to 30 merchandise representatives that currently visit Coles stores on a busy day and there is no standard process, which causes significant business disruption in store, and a resource cost without a material benefit," the letter says.
"To help reduce this in-store disruption, and cost to both suppliers and Coles, we have selected two preferred field force providers, AMC and Crossmark."
As BusinessDay reported in June, the overhaul has sent shocks through agents, also known as merchandising reps, whose daily job it is to watch over product on behalf of suppliers inside the store including everything from restocking to replacing price tags. These field reps also typically replace perishable food stock, and negotiate deals with store managers over special promotions - all of which are key to promoting grocery brands and driving sales to shoppers.
Suppliers will be nudged into going through Coles' new merchandising structure, with those that use Crossmark and AMC expected to get a better value and service in store for their brands.
As an added sweetener to get suppliers on side, Coles has offered to reinvest any gains from the restructure back into supporting their brands.
Frequently Asked Questions about this Article…
Coles is overhauling the way grocery brands have their stock handled and promoted in stores by changing its merchandising structure. The supermarket has chosen preferred providers for in-store merchandising to reduce disruption, standardise processes and provide a lower-cost service to suppliers.
Coles has selected marketing services companies Crossmark and AMC as its first 'preferred providers' of merchandising services to operate in Coles stores.
According to the announcement to suppliers, the new merchandising system is due to start before the end of the year.
Suppliers will be nudged to use Crossmark and AMC and those that don’t want to hire those firms will be required to have their merchandising agents complete an accreditation course. Coles says the change is designed to reduce in‑store disruption and lower costs for both suppliers and the retailer.
Coles says up to 30 merchandise representatives can visit stores on busy days with no standard process, causing significant disruption and resource cost without a material benefit. The preferred provider model aims to cut that disruption and deliver a more consistent, cost-effective service.
Merchandising reps typically manage restocking, replacing price tags, replenishing perishable food stock and negotiating store promotions. Those day‑to‑day activities are central to promoting grocery brands and will be reorganised under the new structure.
Coles has offered to reinvest any gains from the restructure back into supporting suppliers’ brands, according to the letter sent to suppliers.
Investors may want to monitor the rollout timing, supplier uptake of Crossmark and AMC, how accreditation for other agents is handled, and whether Coles follows through on reinvesting gains into brand support—these factors will show how smoothly the change is implemented and how it affects in‑store operations and supplier relationships.
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