|June 2, 2005, as reported
by just-food.com: A lack of complaints against Scotland’s
supermarkets has raised eyebrows and concerns over processors abilities
to speak frankly about their experiences. The National Farmers Union
Scotland has called on the Office of Fair Trading and UK government
to establish an independent regulator to ensure fair trade between
the major supermarkets and their suppliers.
“The public silence amongst supermarket’s suppliers
speaks volumes,” said NFUS president John Kinnaird. “It
is of absolutely no surprise that the OFT has received virtually
no evidence of breaches of the Supermarkets Code of Practice. Many
of the companies that we contacted required repeated assurances
from us that any comments they made would never be attributed to
them. That kind of fear within the food supply chain is totally
NFUS contacted the companies in light of the OFT’s recent
report which again found virtually no evidence of breaches of the
Supermarkets Code of Practice. NFUS, and indeed the OFT itself,
has recognized that fear amongst supermarket suppliers of complaining
against ill treatment prevents anyone using the Code to settle disputes.
Due to the ongoing fear of supermarket reprisals, the majority
of suppliers NFUS contacted would only share their experiences on
condition of strict confidentiality and none of the allegations
of misuse of supermarket power can be attributed.
The practices found by NFUS included loyalty payments (also known
as slotting fees, charged to buy shelf space) are still demanded.
Non payment can result in the loss of business, it said. There were
also fees charged for artwork and re-packaging of products which
were enforced and not negotiated. Supermarkets, the union said “like
to ‘manage’ the public statements of their suppliers.”
“The concept of ‘reasonableness’ in changing
contract terms, particularly payment terms, is one-sided,”
it said. “The renegotiation of supermarket contracts is not
always determined by price and quality of service. “
NFUS stressed that not all feedback from suppliers was negative.
Indeed, NFUS did receive evidence that emphasized that there were
many positive aspects to the supermarket and supplier relationship.
However, it was clear from the overall evidence that current activity
within the UK food and drinks industry is affecting competition.