Crunch time for Tacon as she bares her teeth at suppliers

Push has come to shove for the indefatigable Groceries Code Adjudicator, Christine Tacon, and her ongoing investigation into Tesco.

Seven months after announcing her probe into the activities of the UK’s biggest retailer - on the back of the scandal over its £263m financial black hole - The Grocer has revealed Tacon has written to a raft of suppliers, from across different sectors, demanding they come forward to give her evidence.

It is a bold move by the Adjudicator and one that raises huge question marks over the power of her role, and for the relationships between her office, suppliers and Tesco.

Lawyers have told The Grocer that suppliers who refuse to come forward as a result of Tacon’s letters risk criminal prosecution.

Yet at the same time there are widespread reports that Tacon has encountered huge reluctance among the supplier community to line up with evidence against Tesco, over and above the file from Deloitte handed over by the company itself, which sparked her investigation in the first place.

In part, this can be explained by the continuing climate of fear, which Tacon’s own survey in June showed was still the big reason why suppliers would not make a complaint against any large retailer.

Despite her pledge to protect the confidence of suppliers who come forward, companies are still hugely reluctant to raise their heads above the parapet. And who can blame them, considering the particular retailer in question is part-way through a process of chopping 20,000 SKUs from its range.

It is also hard to see how, from a legal viewpoint, evidence could be used with complete anonymity assured - if nothing else, because it would rob Tesco of the chance to thoroughly interrogate the evidence.

However, there appears to be more to the stonewalling Tacon has encountered than that. Some detect a reluctance among suppliers to dig up more skeletons at Tesco and invite a whole truckload of further scrutiny and potential regulatory red tape on the wider industry - especially when, under Dave Lewis and his Project Reset, the retailer has already shown a determination to clean up its act.

As one lawyer puts it, suppliers are in a Catch-22 position. “It’s head you lose, tails you lose,” he says.

Give evidence against Tesco, and suppliers will feel they are not only risking future listings but also inviting outside interference in a relationship that might just be on the mend already.

At the same time, do suppliers really want to risk being dragged through the courts by an Adjudicator set up to protect them?

For Tacon, the stakes are arguably even higher. She already knows the snipers will be lining up to call her toothless if the Tesco probe is seen to be a damp squib. It is already, according to some quarters, limited because of her lack of ability to fine.

But it could be even more disastrous if she ends up alienating the suppliers she was brought in to safeguard. Little wonder the case looks like it faces what could be a lengthy delay. And who would dare predict the outcome.