Date(s) - 26th June 2017
Groceries Code Adjudicator agrees to a further year in the post, while new survey suggests her work is having a major impact.
Groceries Code Adjudicator Christine Tacon has confirmed that she will continue for a further year, while the new government evaluates the role’s remit.
At the GCA’s annual conference in Westminster on 26 June, Tacon said her decision “allows both me and BEIS ministers to consider whether I am the right person for the role if the call for evidence leads to significant change to the GCA.”
The event also saw the release of Tacon’s office’s latest survey, which shows fewer direct suppliers saying they had experienced code breaches for the fourth year running. The proportion now stands at 56 per cent, down from 62 per cent in 2016 and a high of 79 per cent in 2014.
“The overall fall is welcome, but the more dramatic data comes from looking at supplier experience of issues that I have identified among my Top 5 and where I have used collaborative or more formal regulatory action to drive change,” Tacon said. She named her new Top 5 issues as delayed payments, forecasting, promotions, payments for better positioning and ‘pay to stay’.
Among the standout figures in the report, only 12 per cent of suppliers reported forensic auditing as an issue in 2017, down from 45 per cent in 2014 – this followed a voluntary commitment among eight out of 10 supermarkets to restrict the practice.
Only 10 per cent of suppliers raised concerns about lump sum payments for margin maintenance, down from 36 per cent in 2014. That followed Tacon’s investigation into Tesco, which made clear that any request for margin needed to be unambiguously supported by supply agreements.
In 2014 unjustified charges for consumer complaints was the second-biggest issue, with 37 per cent of suppliers reporting it. A year later Tacon’s office published a best practice statement and monitored progress, leading to only 12 per cent of suppliers reporting it as an issue in 2017.
And following action from the adjudicator, only 11 per cent have reported concerns with packaging charges this year, compared to 24 per cent in 2014 and 30 per cent in 2015.
Tacon said: “Suppliers have found the issue of packaging and design charges to be an irritant for years. Recently a supplier in the fresh produce industry told me that that they had been trying to resolve the problem of overcharging in this area for more than 10 years. But within 18 months of me focusing on the problem he was pleased to say the issue had gone away.
“I see this as a sign that the collaborative approach that I have promoted has been a real engine of change and is achieving positive results across all retailers. I am delighted that suppliers are seeing the benefits of this change.”
For the fourth year running, Aldi topped the overall table in which suppliers rank their perception of retailers’ compliance with the code. Sainsbury’s was the highest placed of the big four, also for the fourth year in a row.
“I am also pleased to report that suppliers are recognising that Tesco is continuing to improve; as is Morrisons, following a step change in its engagement with suppliers,” Tacon added.
Tony Baines, managing director of buying at Aldi, welcomed the report. “We are incredibly proud to have topped the Groceries Code Adjudicator’s annual survey for the fourth consecutive year,” he said. “We recognise that pressure on supply chains is increasing across the retail sector, but our approach will not change. We will continue to build long-term relationships with suppliers that are fair, sustainable and predictable.”
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