Tesco suppliers squeezed

Tesco “Knowingly delayed paying money to suppliers in order to improve its own financial position”, the supermarket ombudsman has found.

Foodservice Footprint Unknown-1-300x200 Tesco suppliers squeezed Grocery sector news updates Out of Home sector news  Speaking on Farming Today, the Grocery Code Adjudicator, Christine TacoIn explained that “on the whole, they would pay for goods on time” but errors in the system could take years to rectify. She said that in some cases, it took over two years to repay multimillion pound sums arising from price changes being applied incorrectly. The investigation arose from the circumstances underpinning the mis-statement of profits announcement by Tesco plc in September 2014.

The ombudsman told Tesco to “introduce significant changes to practices and systems after finding Britain’s largest supermarket seriously breached a legally-binding Groceries Supply Code of Practice (the Code) to protect groceries suppliers.”

However, Talcoln acknowledged that the supermarket giant had worked hard to overhaul its operations, and that “suppliers have reported improvements in their relationship with Tesco to me since the period under investigation.”