I know a number of you have posted in the past about having cheese price agreements. If have an agreement on cheese prices based on block price would you please post the following information:
Block + 25
Illinois
Local didtributor
Come on guys. I have seen a number of posts over the last year where people mention these deals. One of my food reps is telling me they can not do it and I want to show them it is happening out there.
Block + .36
Lipari Foods
Ohio
I think the brand of cheese would make a difference too. I doubt if anybody can get Grande for 25 or 36 cents above block.
sspizza, no doubt you are right about grande. They have always been overpriced.
For the most part over the last 10 years we have been able to buy LMPS mozz for 20-30 cents over block (delayed about 2-3 weeks) It was pretty rare that we got down to 20 cents or better though. Even when looked at as a % over block with block in the $1.20-$1.50 range that it spent so much time in we were looking at prices that were mostly 15% above block.
In today’s market that % would yield a price in the range of $2.05 to $2.25 for the last month or so. I think our suppliers have been gouging us lately.
We currently pay 21.5 cents over block for Saputo. It’s up about 4 cents over where it was when we first set up the contract. Keep in mind that as fuel prices have increased, it costs your distributor more to bring cheese into their warehouse, so they should be chargeing you a bit more than they used to over the block price. If your distributor doesn’t offer priceing set to block prices if some form, they probably are ripping you off. It’s really not at all of an uncommon practice.
I’m at + .17 for LMWM. Don’t ask me how or why; I have no idea… I told them I wanted an agreed upon price over block and that’s what they gave me. I couldn’t sign that thing fast enough. Despite rising fuel costs, the price has stayed the same thus far.
About a year ago they told me that they were paying block +11 cents and an additional 5 cents for freight. With carrying costs, they told me, they were actually losing money selling me cheese. The DM told me he would even show me the invoice to prove it! I told him to go ahead and bring it in for me. It’s been a year and I still haven’t seen it.
I had a buyer from another distributor tell me that the big distributors pay well below the block price for cheese. Block is what anybody can buy it from a manufacturer for. If you want 40,000 lbs you can buy it right at the CME for that price (it would be cheddar, but the principle still applies.) When you’re buying hundreds of thousands of pounds on contract the price tends to drop a bit.
If you take a look at the contract specifications for the CME cheese contract the block price also includes 300 miles of freight from the manufacturer. That means at least some of the rise in fuel costs are already included in the block price.
I too feel I am get ripped off. We are suppose to be on a 5% over cost contract. Usually the block (last year) ran about .20 cents over block prices.
Let me guess Bodg…you are using US foods too?
We buy from both US and Sysco. We check prices pretty regularly. This week US was at $2.46 but Sysco was at $2.36.
Any one else have a block price agreement?
Remember…percentages are relative to a number. As the price of cheese increases, your pennies over block will increase relatative to that percentage. For example 5% of 2.00 is 10 cents and 5% of 3.00 is 15 cents.