Anne Bruce
Tesco is demanding payment from suppliers to cover the costs of its compliance with Christian Aid's ethical trading initiative.
The letter to suppliers, leaked to The Grocer by one angry recipient, stated that Tesco wanted £69.50 per quarter per supplying site from all primary suppliers to cover costs of compliance.
A spokeswoman for the initiative said the letter, written by group trading law and technical director John Longworth, could result in Tesco being expelled from its programme.
"We note with concern the contents of this letter, and we will be taking this matter up with Tesco as part of ongoing discussions over its membership," she said. The supplier, who wants to remain anonymous, said: "It is disgusting that suppliers have to pay, but no supplier is going to complain to the OFT because they can't afford to lose the business.
"But this is only one of the unreasonable charges Tesco makes on its suppliers."
The supplier added: "The Competition Commission should look into the costs that Tesco inflicts on its suppliers. This latest charge is per site, which is unfair to smaller suppliers who may have a number of sites. Larger companies may have only one site, and won't miss £69.50 a quarter."
Tesco's letter to suppliers was dated May 13 and informed them the new payment regime would come into force on May 18.
It stated that under new ethical trading procedures all suppliers would undergo a desk-top risk assessment, followed up by "routine commercial contacts with the Tesco team".
Suppliers in countries where ethical trading problems existed would have to pay for a full assessment against standards set by the ethical trading initiative's base code.
All the major multiples apart from Waitrose, Iceland and Morrisons are members of the initiative, which was launched in 1998. It is an alliance of companies, non-governmental organisations and trade unions committed to implementing industry-wide standards for ethical trading.
Tesco said in a statement: "As a responsible retailer and a founding member of the ETI, we work in partnership with our suppliers to maintain, develop and improve standards in the supply chain.
"This is just one example of us sharing and encouraging good practice with our suppliers."
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Tesco is demanding payment from suppliers to cover the costs of its compliance with Christian Aid's ethical trading initiative.
The letter to suppliers, leaked to The Grocer by one angry recipient, stated that Tesco wanted £69.50 per quarter per supplying site from all primary suppliers to cover costs of compliance.
A spokeswoman for the initiative said the letter, written by group trading law and technical director John Longworth, could result in Tesco being expelled from its programme.
"We note with concern the contents of this letter, and we will be taking this matter up with Tesco as part of ongoing discussions over its membership," she said. The supplier, who wants to remain anonymous, said: "It is disgusting that suppliers have to pay, but no supplier is going to complain to the OFT because they can't afford to lose the business.
"But this is only one of the unreasonable charges Tesco makes on its suppliers."
The supplier added: "The Competition Commission should look into the costs that Tesco inflicts on its suppliers. This latest charge is per site, which is unfair to smaller suppliers who may have a number of sites. Larger companies may have only one site, and won't miss £69.50 a quarter."
Tesco's letter to suppliers was dated May 13 and informed them the new payment regime would come into force on May 18.
It stated that under new ethical trading procedures all suppliers would undergo a desk-top risk assessment, followed up by "routine commercial contacts with the Tesco team".
Suppliers in countries where ethical trading problems existed would have to pay for a full assessment against standards set by the ethical trading initiative's base code.
All the major multiples apart from Waitrose, Iceland and Morrisons are members of the initiative, which was launched in 1998. It is an alliance of companies, non-governmental organisations and trade unions committed to implementing industry-wide standards for ethical trading.
Tesco said in a statement: "As a responsible retailer and a founding member of the ETI, we work in partnership with our suppliers to maintain, develop and improve standards in the supply chain.
"This is just one example of us sharing and encouraging good practice with our suppliers."
{{NEWS }}
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