Fair pricing in foodservice

CH&Co’s Caroline Fry explains why she supports the idea of a fair price for dairy farmers, but it’s not always easy.


When the recent media interest in the price paid to dairy farmers threw an unflattering spotlight on the buying practices of supermarkets, their PR departments went into overdrive with statements of support and pledges to pay a premium per litre above the milk price ‘base rate’.


Charlton House is owned and run by food lovers, so it’s second nature for us to want to stay close to the source of our food, and we share the public’s view that hardworking dairy farmers deserve a sustainable price for milk.


I’d love us to be in a position to pledge a sustainable price paid to dairy farmers.  The price we pay our dairy supplier has increased this year, and I believe the amount we pay allows a fair price to go to the farmers.


There are various reasons why contract caterers are less able than retailers to disclose the price they are paying for milk.  While the retailer’s customer chooses how much of his own money he wants to spend on milk, possibly influenced by knowledge of what the supermarket itself pays, the model is very different in foodservice.


The issue, of course, is that we contract caterers typically don’t spend our own money – we purchase on behalf of a client.  The decision is often taken out of our hands as to how much we pay.  We have a wide range of clients and whilst some are well informed and supportive of a fair deal of the dairy farmer, others might well be more concerned about their pennies.


For us to take a stand and insist on paying a transparently fair price for milk, we need the support of our clients.  If they disagree and prioritise cost over fairness, we cannot “enforce” a fair deal.  We are blessed with clients who do prioritise quality over price, so we’re in with a fighting chance, but this is the start of a long journey and being able to claim “£xx per litre goes to the farmer” won’t happen overnight.   But I am convinced that our industry should take this matter seriously. Contract caterers have to get to grips with this issue and must work together to ensure a fair deal to the farmers.


The supply chain often includes the farmer, the packer, the distributor, the caterer, the client and then the customer.  Contract caterers would traditionally use large processors as their suppliers with little leverage to force better pricing due to the lack of volume.  There are very few contact caterers the size of Tescos which reduces the pressure they can apply to ensure a sustainable price for the farmer.


Our main dairy supplier is an independent, family owned business who cares about the farmers and their animals alike.  They use suppliers who believe in paying farmers a fair price above average whilst still trying to be competitive.


The proposed FairDeal scheme is a good idea, as long as targets are realistic and they get the accreditation standards right.  There needs to be a level playing field and the same rules for everyone using the FairDeal logo.  I would also want to see a fair deal for the cows producing the milk, with minimum standards of animal welfare.


September’s Foodservice Footprint will include an analysis on milk price