Tesco suppliers and farmers say new fulfilment fees introduced by the supermarket giant could put them out of business.

Tesco wrote to suppliers last week to say it would introduce new Amazon-style 'fulfilment fees' to each item sold on Tesco.com and through its app to help cover rising online costs, as reported by Retail Gazette.

The fees are expected to be 12p per item for branded goods and 5p for own brand, although the retailer has since said this is up for negotiation with each supplier.

Charges will also apply to all orders for retail and catering customers made through the grocer's wholesale business, Booker, which has stores in Gloucester and Cheltenham.

Tesco told suppliers that those who don't comply with the new fees could face reduced prices or range reviews.

The new charges could apply as early as today (March 13), but the supermarket said there was no deadline to sign up.

Tesco said it is introducing the fees to respond to changing shopping habits and increasing fulfilment costs. It believes introducing the charges is about working with suppliers to crate a 'balanced approach'.