Metcash has secured a new deal to supply Drakes Supermarkets’ Foodland stores in South Australia, following uncertainty over its supply agreement with the chain last year.
On Monday the wholesale distribution company announced that it will supply Foodland Supermarkets in the state until September 30 2019, in a deal which may be extended by Drakes Supermarkets to September 30, 2020 if desired.
Metcash also secured a deal to supply Drakes Supermarkets in Queensland for a further five years following on from its supply agreement which expired on June 2.
In May last year, Drakes Supermarkets refused to agree to a deal that would see its supermarkets in South Australia supplied by Metcash’s new purpose-built distribution centre, casting doubt over its supply arrangement with the chain.
Drakes has more than 50 stores in South Australia and Queensland and the account is worth around $270 million to Metcash annually.