Lewis Road has accused Fonterra of attempting to gain more than 95 per cent of milk fridge space in some North Island supermarkets, which it claimed would effectively knock smaller competitors out.
The alleged arrangement between Fonterra and Foodstuffs involves fridge space in New World and Pak ‘n Save supermarkets.
Fonterra and Foodstuffs were tight-lipped on the details of any agreement, but said they both wanted a range of milk products for customers.
Lewis Road co-founder Peter Cullinane said on Thursday he had not heard of any change in position from either Foodstuffs or Fonterra.
As such, Lewis Road had taken legal advice and its next step would be to take court action against Fonterra if nothing changed.
Fonterra and Lewis Road were also feuding over Fonterra’s new organic brand Kapiti milk, which Lewis Road has alleged copied its packaging.
Cullinane said the double-barrelled legal action would have to launch «pretty soon» as Lewis Road had no intention of rolling over.
«We’re up against a gorilla. There will be more to come.»
Lewis Road posted a letter Cullinane had sent to Fonterra chief executive Theo Spierings on its own Facebook page, which Cullinane said had received an overwhelmingly positive response.
Across all its social media platforms, Lewis Road’s posts have more than 7000 likes, 650 comments and 800 shares: bigger than when Lewis Road’s chocolate milk rose to popularity, he said.
Cullinane said Fonterra normally had about 80 per cent of fridge space in supermarkets, but the addition would effectively lock up the «premium» product space and «knock us out».
The premium category had been the strongest growing in the dairy industry for the last few years, he said, but Fonterra had been slow to react.
Lewis Road’s own sales growth has slowed, particularly after Goodman Fielder’s Puhoi Valley milk came out last year.
«The fact is competition is competition,» Cullinane said.
«Our only ask is that the competition is fair … locking up 95 to 97 per cent of the chiller is, in our view, downright greedy.»
Source: Stuff
Link: http://www.stuff.co.nz/business/87618717/milk-company-fridge-stoush-sours-further