As an industry, we know how important it is to nurture strong, collaborative supply chains, said Philip Clarke, chief executive officer of Tesco and president of the European Retail Round Table, at the launch of The Supply Chain Initiative last month.
The European self-regulatory initiative is designed to promote fair working practices throughout the food supply chain. So far, it has attracted the support of more than 450 companies across Europe including major retailers such as Marks & Spencer and Tesco as well as leading food manufacturers. The European Commission is also supporting the initiative.
It’s taken two years to get to this stage. In November 2011 a set of principles of good practice were agreed, including a list of examples of fair and unfair practices in vertical trading relationships.
Clarke said: “We started on this journey back in 2011, and what we have today is a framework which will protect all parties along the chain, so that we can focus on our important shared goal – delivering for the consumer.”
Of course, getting the framework in place is one thing, getting it to work effectively is quite another. Mella Frewen, director general of FoodDrinkEurope which represents food manufacturers, pointed out: “As with any such Initiative, the proof of its effectiveness is in the implementation; we look forward to the application of the voluntary Framework in the months to come and we strongly encourage others who have not yet signed up, to do so, without delay.”
For companies in the UK, there is already a Groceries Supply Code of Practice, and earlier this year Christine Tacon was appointed Groceries Code Adjudicator.
She can receive confidential complaints and evidence about how large supermarket retailers are treating their direct suppliers. If she finds there has been a breach of the Groceries Supply Code, she will be able to: make recommendations; require retailers to publish details of their breach; and in the most serious cases, impose a fine.
The horsemeat scandal earlier this year highlighted the some of the weaknesses of food supply chains in Europe. Nurturing strong collaborative supply chains is key to managing such risks. These initiatives deserve to succeed.
