Survey shows fall in supply code breaches

'Awareness is up, compliance is up and relationships are improving, but there's still progress to be made,' YouGov finds.

Tacon: priorities set for future - image: HW
Tacon: priorities set for future - image: HW

Suppliers to the large supermarkets are seeing fewer breaches of the Groceries Supply Code of Practice, according to a survey by groceries code adjudicator Christine Tacon.

However, there remains a lack of belief in the adjudicator's effectiveness as well as a need for further training among suppliers to make full use of it, a conference heard last month.

The results of the YouGov survey, largely replicating one taken a year ago, were "positive overall", said YouGov chief executive Stephan Shakespeare. "Awareness is up, compliance is up and relationships are improving, but there's still plenty progress to be made."

The 2015 survey brought a doubling of responses, to 978 direct suppliers, which he described as "a terrific result". It revealed a fall from 79 to 70 per cent in suppliers who said they had experienced potential code breaches, with 17 per cent having raised these issues with retailers. "Tesco was well ahead here - not necessarily a negative thing," said Shakespeare.

For the second year running, the retailer that most survey respondents rated as "consistently compliant" was Aldi, followed by Waitrose. Iceland came bottom on this question, with five per cent rating it "never compliant". But all 10 retailers covered by the code were rated higher on compliance than last year.

At the same time, the share of direct suppliers saying they would raise an issue with the adjudicator has risen from 38 to 47 per cent. Yet 18 per cent of direct suppliers, along with 19 per cent of indirect suppliers and 14 per cent of trade associations, said they would not raise issues with the adjudicator, with more than two-thirds of these giving "fear of retribution" as a reason.

"They don't think I will blab, but that the retailer will work out who has complained," said Tacon. "More than one-third also thought I wouldn't do anything, which I was insulted by. And 28 per cent thought it was just a normal part of doing business."

Addressing the "unconvinced" will be one of her priorities for the year ahead, as well as providing more targeted seminars with trade bodies and encouraging suppliers' uptake of training on the code, she added.

"I have found evidence of continuing ignorance of the code among suppliers. It's not just about knowing it but of using it intelligently. Trade associations can play a part in training. I am hugely reliant on groups like British Growers, who are out among their members. There are masses of obscure ones and we haven't picked up all of them.

"If one says, '15 of our members say this' then it's easier for me to take action. But if I undertake an investigation, I'll need to know who they are."

British Growers chief executive Jack Ward told Grower: "Our research shows that the power of the retailers is right at the top as an issue. But when it comes to the adjudicator, 'no benefit' is the default position. It's easy to say 'we are 15 per cent down so the adjudicator isn't doing its job'. It may not be perfect but it is having an impact."

Addressing the conference remotely, Department for Business, Innovation & Skills minister Anna Soubry said: "There may be a good argument for extending the adjudicator's remit."

While downplaying such an extension, Tacon said: "I have spoken to other retailers who expect to be brought under the code at some point" on the basis of their turnover. She added: "I have been surprised by the consumer interest in this. There are practices which would horrify them. But I don't want to wash the industry's dirty linen in public."

Groceries Supply Code of Practice - A gift that is not used enough

The Groceries Supply Code of Practice "is a gift that's being very much underused at the moment", Sentinel Management Consultants chief executive David Sables told the conference.

"If you spot a breach, you need to react right away to nip it in the bud. Say something that signals you know the code - they will back off if they know you know."

But he acknowledged the disincentives to challenging retailers in this way. "If you get mugged, go back to the mugger and say, do you mean that? Go to the mugger's boss and say, do you support that? Then go to the adjudicator. That's three levels of pain. Most suppliers aren't heroic enough to take a hit for the future of the industry. There is still a fear of retribution - that you'll be dropped next round. They can kill you and make it look like an accident."

He added: "A supplier agreement is fundamental, but some suppliers don't even know if they have one."

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