The CMA (Competition and Markets Authority) has announced that industry rules setting out how retailers should treat their suppliers will now also apply to Ocado and B&M Homestores. This is due to the retailers’ annual groceries turnover now exceeding £1 billion.
The Groceries Supply Code of Practice (GSCOP) sets out how grocery retailers should treat suppliers. It aims to make sure that they do not abuse their commercial power. For example, retailers bound by the Code cannot make changes to the terms of supply retrospectively and must provide notice of and reasons for no longer using a supplier.
NFU acting chief food chain adviser Christine McDowell: “The NFU has lobbied hard over the past few years for the Competition and Markets Authority to extend the remit of the Groceries Supply Code of Practice and we are pleased to see that Ocado and B&M Homestores are now bound by rules on treating suppliers fairly. Widening the scope of GSCOP does send a clear message that the CMA is serious about ensuring fair and lawful practice. But we think this is a missed opportunity to include other retailers under this remit.”
“GSCOP and the role of the Grocery Code Adjudicator, Christine Tacon, have done a good job in working with retailers to give more protection to businesses from unfair trading practices. The recent GCA survey showed that retailers have improved their buying behaviour in recent years but there are still improvements to be made, particularly on areas such as delays in payments.”