“All suppliers to Kaufland—both Bulgarian and foreign—do not receive their money at the time of delivery, nor after one week, but after 30 days, and in Bulgaria this period is one of the shortest in Europe.”
This was stated on “120 Minutes” by Kiril Vatev, a former agriculture minister and founder of one of Bulgaria’s established food production companies.
“During these 30 days, this is not just one delivery. It is a balance that remains within the chain, and that is the supplier’s money. And if such a market player goes bankrupt, all suppliers will be in very serious trouble,” Vatev explained.
According to him, one of the main tasks of the Bulgarian state is to protect its producers in the event of a chain going bankrupt.
“We have bitter experience with Carrefour—it went bankrupt, and receivables worth more than 450 million were not returned to suppliers,” the former agriculture minister pointed out, adding that he himself was one of those affected.
Kiril Vatev explained that negotiations with the major chains are extremely difficult, speaking from his position as the founder of a food production company.
“Absolutely every following year, when negotiations are held on the addendum concerning the commercial terms, every producer is put in a position where they have to give more. There is nowhere for them to get it from. As a chain’s costs increase, the same happens to the producer. Yes, but when fuel and electricity become more expensive, absolutely all materials and raw materials also become more expensive. The cost price is no longer at break-even, and the producer is selling below cost. A chain delays the payment deadlines—one of them delayed mine by five months,” Vatev explained.
“The chains are already here; they control two-thirds of the food market—that amounts to around 70%. They attract the large customer flow, while small shops are dying one after another. I used to work with 2,800 customers, and now there aren’t even 300. Once they create this large volume, you become dependent,” he said.
Source: https://btvnovinite.bg/predavania/lice-v-lice/kiril-vatev-ako-falira-goljama-targovska-veriga-vsichki-dostavchici-shte-zakasat-mnogo-seriozno.html?campaignsrc=clipboard