| 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 unacceptable”
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.
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