Blog: Dean BestWhy France's retailers are sitting pretty

Dean Best | 2 June 2008

Today (2 June) has seen the opening salvoes in what promises to be a stormy debate around retailing in France.

The French parliament has discussed commercial practices between retailers and suppliers. Again.

A month ago, finance minister Christine Lagarde outlined her proposals to modernise the French economy. These include fully net prices from the outset of a trading year and "simplified" requirements for accounting for services rendered by retailers.

This is music to the ears of retailers. Intermarché chief executive Philippe Boutron told Le Figaro that the proposals were "undeniably favourable" to his business, while Michel-Edouard Leclerc can barely conceal his glee.

Suppliers of all descriptions closed ranks, forming a national alliance to fight for transparent trading. High on the list are proper invoices for services rendered by retailers, which often comes with high price tags.

"We want the process to be transparent,” says Cathérine Lion, deputy director general of the farmers' union FNSEA. “We are asking for a price-monitoring unit to track input costs and margins, then for this information to be made public.”

The FNSEA is supporting food manufacturers to protect its customer base. Coop de France is also committed to fair trading for vertically integrated cooperatives: its members operate a number of French household names such as Yoplait yoghurt and meat brand Soviba.

"I am not very optimistic for the suppliers," UMP deputy Michel Raison tells us. "After all, if retailers wanted lower prices, they could trim their margins."

Not without a fight, though. Watch this space.

Peter Crosskey


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