“Bullying” supermarkets are giving procurement a bad reputation - that was the damning verdict from the supply chain industry this week.
The criticism comes from 88% of supply chain managers surveyed by the Chartered Institute of Procurement and Supply (CIPS), which questioned over 1,000 individuals.
“Our members are unequivocal: the retail sector is not doing enough to clean up its act after years of scandals. It’s time the industry sat up and took notice,” said CIPS group chief executive David Noble.
“Consumers want to know the goods they are buying are procured in a fair and transparent manner. Hiding behind the defence of being ‘a buyer’ rather than a procurer is an abdication of responsibility. Appropriate professional training is essential if we are to see the real step change we need.”
Noble added “mean-spirited, opaque supplier charges” were “a blight” on the UK economy. “They impact the bottom line of small businesses, threaten job security and impact the quality of products.”
The survey also shows suppliers believe ‘pay to stay’ charges are a particularly common example of bullying, with 49% rating it as the worst tactic. These charges force suppliers to pay fees for supplying their goods.
Suppliers also highlighted issues around receiving payment, with 18% saying late payment was the worst tactic, while 17% picked lengthy payment terms. Just 7% picked retrospective discount charges as the worst tactic, and 3% picked payment for point-of-sale promotions.
Looking ahead to the future, supermarkets needed to focus on traceability and transparency to repair their reputations, said 44% of suppliers.
This follows earlier CIPS research that found only 11% of suppliers had visibility of their entire supply chain.