GCA announces best practice statement for audits

By Gwen Ridler contact

- Last updated on GMT

Mark White revealed a new best practice statement for future audits
Mark White revealed a new best practice statement for future audits

Related tags: Audit, Gca

A new best practice statement to respond to suppliers’ concerns about the way the large supermarkets are carrying out audits was unveiled by the Groceries Code Adjudicator (GCA) today (30 September).

Speaking at his first annual conference, Mark White announced that all 13 Designated Retailers had signed up to the statement intended to promote better working practices by these businesses.

They agreed that the statement set the best practice benchmark to conducting audits in a transparent way to reduce the number of invalid claims.

He went on to address concerns from suppliers about retrospective audit review, especially those related to promotional activity

“They are concerned about an apparent lack of data, or cherry picking of data, the time it takes to settle matters and, in some cases, attempts to link settlement of issues to current and future trading. Smaller suppliers can be disproportionately affected by such audits, which really concerns me,”​ White explained.

Better scrutiny of claims

“The best practice statement is intended to promote better working practices by the Designated Retailers, in the spirit of continuous improvement. To that end, retailers should properly scrutinise claims before they make them – they should share with suppliers the data and documents that support a claim and claims should be concluded in a reasonable timeframe.”

White made it clear that the settlement of claims must not be conflated with future or current trading and that suppliers should know from the outset whether third parties have been used by retailers to make claims.

Conference participants also heard the results of deep dive interviews covering suppliers’ current concerns, carried out for the GCA by YouGov. Among the themes identified was the number of inexperienced buyers joining the retailers.

“Many suppliers YouGov spoke to were also concerned that among these new buyers there was a lack of knowledge about the Code,”​ White added.

‘Lack of knowledge’

“But there also seems to be a lack of knowledge about the category that they are working in, with suppliers spending a lot of time and effort educating the buyer, only to see the buyer move category just when the knowledge bank has grown.”

This lack of knowledge extended to buyers not visiting food production sites, where they could better understand the challenges faced by the supply side.

“I encourage retailers to not only train their buyers in the requirements of the Code but also in wider relationship building and in really understanding what they are asking suppliers to do​,” White continued.

“This should make their jobs both more challenging but also more interesting and help to change the growing perception that buyers are automatons controlled by faceless senior management.”

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