Five Hidden Factors in Your MDA and How to Negotiate Around Them

MRM's "Ask the Expert” features advice from Consolidated Concepts Inc. Please send questions to Modern Restaurant Management (MRM) magazine Executive Editor Barbara Castiglia at bcastiglia@modernrestaurantmanagement.com.

Q: I want to negotiate the best contract with my broadline distributor, what are some things I need to consider?

A: Most operators who have scaled to multiple locations have found the benefit of pursuing a Master Distribution Agreement, or MDA, with their main broadline or grocery distributor.  This contract offers the operator an opportunity to lock in pricing terms on their order guide items, and avoid drastic swings in costs and terms from their primary distributors. However, these contracts often carry terms that may cause an operator to minimize the deal that they’ve negotiated. Here are several ways to avoid MDA pitfalls. 

Freight Costs and Fuel SurchargesFuel surcharges became popular among broadliners during the 90's when fuel prices…