Speaking earlier this morning at the Institute of Grocery Distribution’s (IGD) annual convention, Solving the Value Equation, David Webster, chairman of supermarket giant Safeway and president of the IGD, said that some stakeholders in the process of food production and retailing are not getting a fair share of the value supermarkets are creating. Getting round this, he suggests, will be down to informing consumers and producers of all the facts.
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The majority of consumers are happy with the range, value and safety of the products that are available in supermarkets, commented Webster, but importantly, most people are ignorant of the processes involved in getting foods onto the shelves
But does this matter? Webster is adamant that it does, because ignorant consumers are vulnerable to manipulation by critics of the retail sector.
At the other end of the supply chain, Webster says that farmers too are vulnerable because with a lack of information they are unclear whether the government is positively committed to their sector, and what a shift in subsidies policy will mean for those involved.
Richard Baker, deputy COO at Wal-Mart owned Asda, agreed that supermarkets need to be better at telling their side of the story, and trumpeting their successes.
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By GlobalDataFor example, he revealed that if supermarkets chose to buy meat supplies based on price alone, the consumption of British meat would halve. The retail sector is not getting enough credit for this fact, however, and its constant efforts to support British industries by sourcing locally produced products.
Similarly, Baker points out that supermarkets in UK ploughed £2.5bn worth of capital investment back into improvements and price cuts at a retail level last year alone. The money was not simply redirected to shareholders and retailers need to tell their shoppers and suppliers of their positive investment into making things better.
