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August 4, 2009

UK: Competition Commission publishes grocery code

The UK’s Competition Commission has published its final order to establish a code of practice governing the relationship between the country’s grocery retailers and their suppliers.

The UK’s Competition Commission has published its final order to establish a code of practice governing the relationship between the country’s grocery retailers and their suppliers.

Following last year’s investigation into competition in the market, the Commission said that a strengthened code of practice was needed to provide a “clearer framework” for contractual agreements between retailers and suppliers.

The Commission has also asked the UK government to set up an ombudsman to resolve disputes between suppliers and retailers.

“The aim is to ensure that suppliers do not have costs imposed on them unexpectedly or unfairly by retailers,” the Commission said this morning (4 August).

The new Groceries Supply Code of Practice (GSCOP) will be based on the existing supermarket code of practice, but will be amended so that an overarching “fair dealing” provision is included.

Retailers will be prohibited from making retrospective adjustments to terms and conditions, while suppliers will not be not liable for shrinkage.

Retailers will also be required to keep written records detailing terms and conditions, as well as enter into binding arbitration to resolve disputes.

The code of practice will be applicable to all retailers with a groceries turnover in excess of GBP1bn per annum and it will be written into all contracts between supermarkets and suppliers.

The Commission also revealed that it has asked the UK government to establish a retail ombudsman to arbitrate disputes, having failed to win retailers’ support for the move. 

Commission chairman Peter Freeman said that it was “clearly desirable” that the ombudsman be established “as soon as is practicable”.

“The new code of practice will work much better as a result and suppliers and retailers will have greater confidence that its terms will be observed,” he said.  

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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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