ACS

A new Grocery Suppliers Code of Practice has come into force today to prevent supermarkets from abusing their dominant position and help suppliers achieve a fairer deal when doing business.

Some of the measures in the code include outlawing supermarket requests to suppliers to fund two-for-one promotions; a requirement of supermarkets to keep written records of all supplier negotiations and the appointment of compliance officers in supermarkets.

The code of practice covers all grocery retailers with annual sales topping £1billion, instead of just the “big four” covered in previous codes and is implemented as a result of the Competition Commission Grocery Market Inquiry, chaired by Peter Freeman (pictured).

However, according to the Association of Convenience Stores, the new Code of Practice holds no real power over supermarkets without an independent Ombudsman.

ACS Chief Executive James Lowman said: “We are hopeful that the Code of Practice will stamp out the worst buying practices that undermine suppliers and harm competitors, if successful consumers will see the benefit in increased investment and reduced prices across the industry.

“We remain convinced that the Code of Practice will not be wholly effective until there is a proactive independent Ombudsman to ensure fair dealing.

On Friday, the government will begin its twelve week consultation to determine how a Grocery Ombudsman would work to benefit the retail industry. ACS will be making its response.