David Prosser: We're the ones squeezing out the suppliers


Outlook Whoever wins the election, the writing is on the wall for the supermarkets, with both Labour and the Conservatives now signed up to the idea of an ombudsman to police the relationship between the sector and its suppliers. The "enforcer" will rule on breaches of a code of practice – in theory preventing those nasty giant supermarkets from driving hard-working small businesses (think vulnerable farmers) into the ground.

It's a nice idea, but what difference will the plans make? After all, we've had a code of best practice governing relations between the supermarkets and their suppliers for some time, but operating on a voluntary basis. Not a single grocer has ever been found to be in breach of it. So the supermarkets are all thoroughly decent folk, or the rules aren't up to much. Either way, making the code compulsory isn't going to make much difference.

The Government itself insists that its proposals aren't going to have much impact on the prices that consumers pay in the shops. In which case, why is it bothering? Does it imagine, somehow, that the supermarkets are going to take the hit from the ombudsman's rulings as it tries to protect suppliers? No, the Government is right because there isn't going to be a hit.

The difficulty with this industry is that the competition to supply it is so cut-throat. Suppliers to grocers are prepared to accept whatever terms of business they are offered. And for each one that says no, there are several more prepared to step into the breach.

The responsibility for that lies not with the grocery sector itself but with consumers, who consistently vote with their feet. If everyone who claimed to support small butchers, bakers and candlestick makers got round to shopping on their local high street occasionally, rather than trouping out to the massive supermarkets they apparently dislike so much, the grocers might not be so profitable. But people like the value and convenience that supermarkets offer, so they support the system to such an extent that the supply chain can be squeezed.

There was a good deal of bleating from the supermarkets yesterday, which feel duty-bound to protest about the ombudsman. They have a point in their claim that the biggest beneficiaries of the increased regulation are likely to be the largest suppliers to the sector. And they are even more justified in complaining about the bureaucracy coming their way. After all, it is almost two years since the Competition Commission first recommended that the Government take this step and we still don't even have final proposals.

Still, if the retailers are unhappy now, wait until a Tory government arrives. It accuses Labour of not going far enough and promises much tougher action on the grocers. So much for the party of big business.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Ramsay Bolton in Game of Thrones
tvSeries 5, Episode 3 review
News
peoplePair enliven the Emirates bore-draw
News
British theoretical physicist Stephen Hawking
people
News
Britain's opposition Labour Party leader Ed Miliband (R) and Boris Johnson, mayor of London, talk on the Andrew Marr show in London April 26
General electionAndrew Marr forced to intervene as Boris and Miliband clash on TV
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Treasury Assistant - Accounts Assistant - London, Old Street

£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Business Analyst - Financial Services - City, London

£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...

SThree: Trainee Recruitment Consultant

£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...

Day In a Page

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

Not even the 'putrid throat' could stop the Ross Poldark swoon-fest'

How a costume drama became a Sunday night staple
Miliband promises no stamp duty for first-time buyers as he pushes Tories on housing

Miliband promises no stamp duty for first-time buyers

Labour leader pushes Tories on housing
Aviation history is littered with grand failures - from the the Bristol Brabazon to Concorde - but what went wrong with the SuperJumbo?

Aviation history is littered with grand failures

But what went wrong with the SuperJumbo?
Fear of Putin, Islamists and immigration is giving rise to a new generation of Soviet-style 'iron curtains' right across Europe

Fortress Europe?

Fear of Putin, Islamists and immigration is giving rise to a new generation of 'iron curtains'
Never mind what you're wearing, it's what you're reclining on

Never mind what you're wearing

It's what you're reclining on that matters
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband

Chuka Umunna: A virus of racism runs through Ukip

The shadow business secretary on the benefits of immigration, humility – and his leader Ed Miliband
Yemen crisis: This exotic war will soon become Europe's problem

Yemen's exotic war will soon affect Europe

Terrorism and boatloads of desperate migrants will be the outcome of the Saudi air campaign, says Patrick Cockburn
Marginal Streets project aims to document voters in the run-up to the General Election

Marginal Streets project documents voters

Independent photographers Joseph Fox and Orlando Gili are uploading two portraits of constituents to their website for each day of the campaign
Game of Thrones: Visit the real-life kingdom of Westeros to see where violent history ends and telly tourism begins

The real-life kingdom of Westeros

Is there something a little uncomfortable about Game of Thrones shooting in Northern Ireland?
How to survive a social-media mauling, by the tough women of Twitter

How to survive a Twitter mauling

Mary Beard, Caroline Criado-Perez, Louise Mensch, Bunny La Roche and Courtney Barrasford reveal how to trounce the trolls
Gallipoli centenary: At dawn, the young remember the young who perished in one of the First World War's bloodiest battles

At dawn, the young remember the young

A century ago, soldiers of the Empire – many no more than boys – spilt on to Gallipoli’s beaches. On this 100th Anzac Day, there are personal, poetic tributes to their sacrifice
Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves

Follow the money as never before

Dissent is slowly building against the billions spent on presidential campaigns – even among politicians themselves, reports Rupert Cornwell
Samuel West interview: The actor and director on austerity, unionisation, and not mentioning his famous parents

Samuel West interview

The actor and director on austerity, unionisation, and not mentioning his famous parents
General Election 2015: Imagine if the leading political parties were fashion labels

Imagine if the leading political parties were fashion labels

Fashion editor, Alexander Fury, on what the leaders' appearances tell us about them
Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

Phumzile Mlambo-Ngcuka: Home can be the unsafest place for women

The architect of the HeForShe movement and head of UN Women on the world's failure to combat domestic violence