Plenty of remarkable stats emerged at the Groceries Code Adjudicator’s conference in Westminster today, and not just the length of small business minister Anna Soubry’s 90 seconds keynote, delivered by video link.
More encouraging than her input, for suppliers anyway, was the headline that retailer behaviour seems to be heading in the right direction.
A survey by YouGov, commissioned by the indomitable Christine Tacon, suggests a general improvement among the biggest 10 supermarkets, with the proportion of suppliers reporting GCA-related issues in the past 12 months falling from 79% a year ago to 70%.
Tacon had particularly kind words for Tesco, whom she is currently investigating. She claimed there had been a “big improvement” in behaviour under new CEO Dave Lewis’ drive to switch the focus from back margin to front margin, a trend discernible in other supermarkets too.
The survey also shows that more direct suppliers would now consider raising issues with the adjudicator, a stat up from 38% last year to 47% in 2015.
Surely, though, that is where the good news stops.
YouGov’s report reveals that, of the fifth of respondents who would still not raise an issue with the GCA, 68% would not do so because of a climate of fear. That last stat has hardly budged since 2014, when it stood at 69%.
There is, therefore, still a huge body of suppliers with no intention of coming forward under any circumstances, a figure cynics suggest would be much higher if it included the 90% of suppliers who refused to even take part in the survey.
Even where there have been bigger shifts, there are truly shocking figures in the report.
Of all the supermarkets just three, discounters Aldi and Lidl, plus Tesco itself, have more than 50% of suppliers claiming to have a written supply agreement with them.
That figure drops to just a third with Iceland, but Asda, Waitrose, Sainsbury’s and the Co-operative Group all have more than half of their suppliers claiming not to have in place something that constitutes a fundamental part of their relationship.
Perhaps even more worryingly, the figures appear to show a number of retailers are still ignoring the Code on a routine basis.
Even post-scandal, Tesco is said to rarely follow the rules by 30% of its direct suppliers, with 4% saying it never does.
Both Morrisons and Iceland also are seen by more than a third of direct suppliers to either “never” or “rarely” follow the Code. Yet in Iceland’s case Tacon admits she has never had a single supplier mention an incident, let alone raise a complaint, outside the realms of the anonymous survey.
So progress has been made but Tacon is right to acknowledge she is not “proud” of the situation, despite the good work she has done.
So with such numbers of suppliers suspecting that retailers are still abusing their relationships on a daily basis, it’s even more shocking to see, as The Grocer revealed last week, that nearly 70% of suppliers have had no training in the Code.
This has to be one stat that changes fundamentally if there is to be a decisive shift in the uneven balance of power in negotiations.
Apart from anything else, how can we even take the anonymous allegations of Code breaches at all seriously with suppliers having such a lack of knowledge of the Code?
Nearly 30% of direct suppliers admit their knowledge is poor, or that, shockingly, they were not even aware of the Code at all. No wonder, then, that retailers are wiping the floor with them, and no wonder either that behaviour, perceived or otherwise, is not changing as fast as it should.
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