Fortune favours the brave business

By Rick Pendrous contact

- Last updated on GMT

Rick Pendrous, editor, Food Manufacture
Rick Pendrous, editor, Food Manufacture

Related tags: City food lecture, Food, Supermarket, Christine tacon

Groceries Code Adjudicator Christine Tacon highlighted a persistent problem within the UK’s food industry last month. She said “excessive risk” was being passed down the supply chain by overly powerful retail customers. As a result, some manufacturers’ margins are being badly squeezed, which had prevented them from investing in new products and processes that are necessary to thrive and grow.

Failure to innovate and invest could force some smaller suppliers out of business, warned Tacon. This is not only bad for the suppliers and the prosperity of the UK food and drink sector, it is also bad for consumers, since they have less choice, she added.

Imbalance in power

While the retailers themselves would argue that they have helped make the UK’s food supply chain the exemplar for efficiency it is held to be around the world today, others would argue the imbalance in power has gone too far. Tacon is one. A key part of her role is to attempt to stamp out “unfair trading practices​” as she polices the Groceries Supply Code of Practice, which came into force in February 2010 and applies to the 10 large UK grocery retailers, each with a turnover of over £1bn, she added.

But the imbalance of power could be changing, as highlighted by Booker chief executive Charles Wilson in last month’s City Food Lecture. New sales channels, such as the internet, together with the growth of hard discounters, like Aldi and Lidl, and independent convenience store outlets, and as people eat out more, are changing the dynamic and could open up new opportunities for innovative producers prepared to take advantage of them, said Wilson. The historical failure of the UK food processors – and the dairy sector specifically – to invest in the latest processes and technologies was also a theme raised by City Food Lecture panellist Ronald Kers, chief executive of Müller-Wiseman. It is something his company plans to change, said Kers.

Very latest technologies

At this year’s Foodex, visitors will be able to see some of the very latest technologies and methodologies to help them start taking advantage of the brave new world we are entering. As the world economy picks up there will be opportunities both at home and abroad for innovative food and drink firms to be successful.

It is only by matching bright new ideas with the latest production methods and people with the skills to maximise the potential of these processes that the UK will be able to fulfill its true promise. The potential prize is huge for those bold enough to embark upon the journey.

Foodex takes place at the National Exhibition Centre, nearing Birmingham between Monday March 24 and Wednesday March 26.

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