What did you do, Daddy, in the maelstrom that has been the UK grocery market environment so far this decade?”! Who’d have thought that we would have seen big retailers scrapping for their very survival, manufacturer margins being squeezed inexorably and farmers desperate as international food commodity prices plummet to decade year lows! When the going gets tough, the tough get going but they also get tetchy and even behave badly! Yet, we all know and research consistently shows that collaborative and longer-term relationships in the supply chain are crucial to enhancing efficiency and encouraging innovation to the benefit of us all, not least, the final consumer.
Commercial tensions are intrinsic to most supply chains but, particularly so, in those which are characterized by great uncertainty – of climate, commodity booms and busts, political vicissitudes (e.g. Russian ban on EU food imports), tectonic shifts in the grocery competitive environment, etc. Fifteen years ago, did you even conceive that the energetic Jack Ma and Alibaba would have three times the market cap of Walmart by the end of 2015? We didn’t and Alibaba is no fairy tale! Perhaps, we are in a watershed moment for the power of the “traditional” supermarkets?
In the UK and other countries, grocery supply chain partners have frequently grizzled at the disproportional market power of monolithic supermarkets. Governments have struggled to develop appropriate policies to temper abuses of power and legislative initiatives have been more focused on protecting the consumer interest than the interests of farmers and other grocery supply chain members. In the UK, however, we do have a Groceries Code Adjudicator who is the first independent adjudicator to oversee the relationships between the major supermarkets and their suppliers. Specifically, the GCA ensures that the 10 largest supermarkets treat their direct suppliers lawfully and fairly, and investigates complaints and arbitrates in disputes.
Hurrah, at last suppliers have an organization in place to ensure fair play in their dealings with the big boys. So, what are the grumpy suppliers doing? Largely keeping shtum! Whispering behind closed doors about despicable supermarket practices but failing to communicate directly and in confidence with the very organization that was established to protect their interests. Right NOW, the GCA is launching its 3rd annual survey of the groceries sector. It’s a brilliant opportunity for you to voice your concerns (or even your plaudits) about dealing with the “Big 10” supermarkets. But, in the parlance of the trade, act now to avoid disappointment! The survey closes on April 29th. If you’re dealing with UK supermarkets from home or abroad, just get on the GCA website and complete the survey. You know it makes sense!
Survey Link: http://www.yougov.com/GCA
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