Foodservice hits back on milk prices

FOODSERVICE COMPANIES have defended their milk procurement practices in the face of criticism from ministers and the British Retail Consortium. However, very few would be willing to publicise the price they paid for a pint.

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Footprint approached 10 of the major providers and none revealed what they are paying for milk. Only two – Sodexo and Gather & Gather – said they would publish the figure, provided everyone else did too.


CH&Co communications director, Andrew Merrett, perhaps best illustrated the industry’s take on price transparency.


“The challenge for contract caterers in publishing prices is that a company’s product prices can provide competitive advantage over other caterers and are therefore commercially sensitive,” he said in a statement.


Experts suggested the publication of prices could create mayhem. “One of the reasons is that [caterers] will
add a level of margin to their prices before passing the cost on to their customers – sometimes 30, 40% or more,” one observer noted. “If their net price is in the marketplace it could undermine their commercial position with
their clients.”


The focus, as farmgate prices have fallen, has been on the major retailers that buy and sell the lion’s share on milk in the UK. However, the NFU argued that foodservice companies need to do more to show they are pulling their weight.


“We really struggle making inroads into the contract caterers and foodservice providers,” said chief dairy advisor Siân Davies. “The consumer price and the farm-gate price is well known and publicised. If foodservice providers and caterers have nothing to hide in the way they support British dairy farmers they should be more vocal in how they do so.”


Shaun Allen, purchasing operations director at Prestige Purchasing said there are opportunities for the industry to have greater influence on farmgate prices – but it would require a “fundamental change in mindset”.


A full investigation in to the milk price crisis is included in the current issue (October) of Footprint.