A disagreement has emerged between TGI Foods and its distributor, Lutessy Foods and Services, over contractual obligations, sales support arrangements, and unsold inventory worth about N50m.

Lutessy Foods alleges that delays in product supply and the withdrawal of sales representatives contributed to a build-up of inventory in its warehouses, with some goods approaching their expiry dates. TGI Foods, however, maintains that the distributor did not meet the agreed-upon performance terms and that their business relationship had been terminated in accordance with contractual provisions.

Speaking on the matter, the Managing Director of Lutessy Foods and Services, Tokunbo Peters, said his company paid N10m for stock on September 1, 2025, but the products were supplied later in the month. He also said sales representatives previously assigned to support distribution were reassigned, which he believes affected product movement.

He said the matter was raised with TGI Foods and “After our petition, sales support was withdrawn, and our goods expired, causing up to N50m in losses and damage to our business.”

In correspondence dated November 11, 2025, which The PUNCH reviewed, Lutessy stated that it had stock valued at over N40m across its outlets and expressed concern about items nearing their shelf life. The email referenced follow-up communications with company representatives and described efforts to resolve the situation.

An email written to TGI Foods on November 11, 2025, which The PUNCH saw, partly read, “We paid N10,000,000 for stock September 1st, 2025. After that, we called several times to follow up on the billing, but, no response from our account managers. The response only came on September 18th, after which the order was billed, then we got supplied on September 29th, yet, none of the stock has been sold or payment remitted till today. The reason given was that the TGI sales representative assigned was remapped to another distributor on September 2nd, 24hours after the payment.

“As we speak, we have stock worth about N30,000,000 seated in Igando, and N13,600,000 in Badagry, without a representative to sell. Some of the products, particularly the Golden Terra Oil 1000ml, 20 cartons worth N808,000.00, are close to their shelf life, December 2025 specifically.

“Several attempts were made to speak to Happiness on how to resolve the situation, but to no avail. She gave her word that the stock would be sold off; unfortunately, no positive impact has been felt by the business, yet time is running out. Imagine an investment capital of over N40,000,000 left idle with the huge risk of loss, and the account manager ignores the consequences.

“On Monday, 27th October, about two weeks ago, the remapped sales representative came to pick up stock worth 492,400, but we have yet to receive payment till now. It now appears as though the pick was just to calm our agitation and not necessarily to resolve the situation in an absolute manner.”

Peters further stated that a dispute arose at one of the outlets involving stock reconciliation, which he said was reported to the relevant authorities.

A manager at Lutessy Foods, Oluwakemi Owolabi, maintained that the distribution arrangement included sales support, saying, “The agreement included sales reps to help us sell goods, but that month, the assigned rep didn’t collect any stock for weeks. Now, after five months, some goods are expiring next month, and nearly N50m is affected.”

Responding in separate conversations, TGI Foods said distributors are contractually responsible for redistributing products through their own logistics channels, while company-employed sales representatives provide supplementary support, which was not mandatory.

The Head of Field Sales, Godday Osagie, stated that the redeployment of personnel occurs when sales targets are not met or when operational requirements change. He said decisions are guided by the signed distribution agreement.

“There are key responsibilities from the distributors that they are supposed to do, and if they fail to do that and it leads to a sales rep eloping with money, then that is beyond us because they are supposed to do a daily reconciliation. The distributor failed to keep to the signed agreement, and in such events, the company can decide to terminate the relationship.

“We take actions based on the document the distributor signed before coming in, which clearly states the terms of the partnership. Furthermore, the distributor personally requested that one of their accounts be blocked, while the other remains open but inactive because they stopped depositing funds.

“The business takes it upon itself to hire sales representatives to assist distributors in depleting or selling their stock faster, but it is important to understand that this is optional support, not a mandatory obligation. As a distributor, you are contractually expected to redistribute products yourself using your own vans and distribution channels.

“We cannot continue to keep a sales representative running at a location without getting a return on investment for the business. When we see that a distributor is not meeting their part of the bargain or the required sales targets, we must redeploy those personnel to other locations where they can continue to add value,” he said.

The Head of Corporate Communications, TGI Foods, Rafiat Gawat, speaking with The PUNCH on Monday, said the issues raised had been addressed within the framework of the contract.

“He has a contract, and he knows what the contract says. All the things that he complained about are things that were adequately explained in the contract and in conversations with him. We prefer to resolve issues amicably. That he stopped being a distributor today doesn’t mean that he cannot become a distributor again tomorrow,” she stated.

The PUNCH also gathered that Lutessy Foods’ distributorship agreement had been discontinued earlier in 2025 following a performance review process, although some account arrangements remained in place.

Both parties have maintained their respective positions, with Lutessy indicating it may explore legal options, while TGI Foods insists its actions were consistent with the terms of the signed agreement.