What is a Slotting Fee?
A slotting fee is a fee which a supermarket or chain store charges manufacturers for carrying their products. You may be surprised to learn about slotting fees, as it seems a bit odd to pay for the privilege of having your product appear on supermarket stores, but they are in fact a large source of revenue for many supermarkets and chains, despite attempts at regulation in many parts of the world. This practice emerged in the United States in the late 1970s, and while it is not industry standard, it is very widespread, especially among very large chains. Essentially, these stores charge a fee for carrying new products; products which are already on the shelf may also have slotting fees assessed. The slotting fee for a brand new product is sometimes called a “product introduction fee.” Stores may also institute a “pay and stay” policy when they change hands, meaning that manufacturers will be required to pay a slotting fee if they want their products to remain on the shelf. From the poi
A slotting fee is a fee which a supermarket or chain store charges manufacturers for carrying their products. You may be surprised to learn about slotting fees, as it seems a bit odd to pay for the privilege of having your product appear on supermarket stores, but they are in fact a large source of revenue for many supermarkets and chains, despite attempts at regulation in many parts of the world. This practice emerged in the United States in the late 1970s, and while it is not industry standard, it is very widespread, especially among very large chains. Essentially, these stores charge a fee for carrying new products; products which are already on the shelf may also have slotting fees assessed. The slotting fee for a brand new product is sometimes called a “product introduction fee.†Stores may also institute a “pay and stay†policy when they change hands, meaning that manufacturers will be required to pay a slotting fee if they want their products to remain on the shelf. From t
A slotting fee is paid to a supermarket by a food company when introducing a new food product. Slotting fees were invented by supermarkets in the late seventies to cover the labelling, organizing and placing cost of new products. Supermarkets have very low profit margins and therefore, introducing new food products is a risky business. If a new product doesn’t sell, shelf space is wasted and money is lost. In this way a slotting fee was supposed to be some sort of insurance for the supermarkets.
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