Groceries Code Adjudicator Christine Tacon today praised the “big improvement” in trading conduct by Tesco buyers under new CEO Dave Lewis.
Tacon said Lewis’ move to reset Tesco negotiations with an emphasis on front rather than back margin had been a major contributor to a shift in perception over the past year.
A YouGov survey commissioned by the adjudicator found that 55% of suppliers thought Tesco, currently under investigation by Tacon, now mostly complied with the Code, compared to 47% a year ago.
The proportion of suppliers who thought Tesco “rarely” complied with the Code dropped from 35% in 2014 to 30% this year.
“I think it comes across in the survey that there’s been a big improvement at Tesco,” said Tacon, who stated her investigation into Tesco would go on for a further three months.
The survey also showed a general improvement among the biggest 10 supermarkets, with the proportion of suppliers reporting GCA-related issues in the past 12 months falling from 79% a year ago to 70%.
Tesco remained the supermarket with the most alleged GCA behavior breaches, although Tacon pinpointed Iceland as the supermarket with the second highest number of survey citations.
In total, 35% of buyers thought Iceland rarely or never complied with the Code, and Iceland did not manage an improvement in behavior of the sort displayed by Tesco and other retailers in the survey.
“I’m not proud of the fact that seven out of ten suppliers say they have experienced a possible breach of the code in the past 12 months,” said Tacon, but she claimed things were “on the right track.”
Tacon today also revealed plans for the launch of a new best practices model surrounding the issue of consumer charges, after a probe by the adjudicator found retailers were charging suppliers up to £45 per complaint.
Under the new guidelines there will be recommended standards of behaviour, including calls for retailers to reduce costs and to provide information on products subject to consumer complaints within five days.
The adjudicator is also looking to carry out a similar probe on the fees suppliers are hit with for packaging costs.
As well as showing an improvement in behaviour, the survey found an increase in the proportion of direct suppliers that would consider raising a complaint with the GCA, up to 47% from just 38% in 2014.
Of the fifth that said they would not raise an issue, 68% said it was because of fear of retribution, a figure that has hardly budged since the 2014 survey.
According to David Sables, CEO of Sentinel Management Consultants, suppliers are still living in a “climate of fear”, and there is still cynicism about the role of the adjudicator.
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