September 24, 1998 Presented by: ECR Unsaleables Committee Co-Chairs

1. September 24, 1998 Presented by: ECR Unsaleables Committee Co-Chairs Al Graham, Chairman & CEO, The Oshawa Group Limited Brian Mirsky, President, Campbell Soup Company Ltd ECR Unsaleables Committee - Progress Report

2. Let’s Review … A Case for Change Trading Partners Were not satisfied with previous joint industry recommendations No incentive to reduce the incidence of unsaleables. Distributors Did not feel they were adequately compensated. The handling rate did not cover their costs. Manufacturers Saw unsaleables as ever increasing cost with no accountability.

3. ECR Vision - to eliminate / minimize unsaleables in the supply chain ECR Unsaleables Recommendation - Objective; “To facilitate a cost effective reduction in the incidence of unsaleables products through fair and equitable practices.”

4. Be compatible with the philosophy & principles of ECR Address & resolve issues in a least cost manner, with an Accountability & a monitoring-audit capability. Unacceptable practices should bear the cost Not for profit solution. ECR Unsaleables Solution - Principles

5. ECR Unsaleables Solution - Components Recommendation includes handling rates which more accurately reflects distributors costs. Distributor compensation for unsaleables is determined by performance versus a declining industry benchmark.

6. What’s new in 1998…….. Progress report CCGD Board endorsed the recommendation. November 24, 1997 FCPMC members voted yes January 1, 1998 - Ontario Roll-out began March 1, 1998 - User’s Guide published July 21, 1998 - Joint industry recommendation for a National Roll-out to commence November 1, 1998.

7. So How Are We Doing So Far?

8. Top Line Observations of the Ontario Roll-out Prior to the roll-out, the average rate of incidence for the industry was measured at 15 items / $10,000 retail sales. Three distributors are currently participating in the Ontario roll-out. All 3 are performing below the current industry benchmark of 13 items / $10,000 retail sales. Representing collective performance 13% below the previous year’s industry average.

9. There is a Lot of Work Still to be done….

10. Next Steps National Roll-out to begin November 1, 1998. Regional Seminars will be conducted during October / November Evaluation of 1998 Ontario roll out evaluation of handling rates and, declining benchmarks going forward Work groups to address product categories outside the current recommendation.

11. We now have actionable data & the incentive to act on it. Trading partners will have to initiate dialogues to address identified issues. Next Steps continued…Further development of the trading partners roles

12. What can you do next? If you haven’t already, buy a User’s Guide. Attend the breakout session. Who should attend?