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Tesco admits to breaking grocery code of practice over treatment of suppliers

Tesco has admitted to a number of cases that it believes are likely to have breached the grocery sector’s code of practice.

According to Retail Week, the grocer was accused of mistreating and delaying payments to suppliers in February by the Groceries Code Adjudicator (GCA).

Tesco stated in its Annual Report: “Regrettably, we have concluded that there have been a number of instances of probable breaches of the code which fall short of the high standards we expect to uphold in our dealings with our suppliers.”

“We are taking effective action to prevent this arising again. We are fundamentally changing the way we work with our suppliers to deliver a more sustainable and collaborative business model for everyone in the supply chain.”

The grocer said it would also begin a comprehensive programme for new starter training as well as annual refresher courses.

It will also implement ‘deep dive’ audits throughout the year and introduce bi-annual compliance declarations and disciplinary action where necessary.

GCA Christine Tacon began investigating Tesco in February over its supplier relationships, with the process expecting to take up to nine months.

Tacon is looking into Tesco’s profits and alleged delays in payments to suppliers.

Tesco said 18 code-related complaints were raised by suppliers this year, and that all but one complaint has been resolved.

Readers' comments (1)

  • There is not a "watchdog" in the US that does what is done here. Many HUGE players control supplier and other vendor charges to the extent that the profits of those vendors are scrutinized and controlled. The adage here is, you do what we want or we will find someone that will.

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