Groceries Code Adjudicator Christine Tacon has cleared supermarkets of breaching the code with regards to forecasting to suppliers, but has urged them to do more to improve transparency.
Tacon this week published a new best practice statement for forecasting after carrying out a review of the policies of the 10 retailers covered by the code.
The review found retailers adopted a range of approaches and used the word ‘forecast’ to mean different things. Some made a clear distinction between a forecast and an order; others saw forecasting as an integral part of supply chain management, often proceeding close to real time. Others integrated forecasting into joint business planning.
“The code deals with compensation for forecasting errors and I have seen evidence that retailers are striving for improvement in the accuracy of their forecasting,” said Tacon.
“However, I have asked the retailers to consider what they can do to improve the transparency of their communications about forecasting with suppliers to allow suppliers to meet orders and to calculate the full costs of supply.”
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