In a notable shift, the Groceries Code Adjudicator’s (GCA) 2024 annual survey reveals enhanced treatment of grocery suppliers across most retailers.
Yet, Amazon’s compliance with the Groceries Supply Code of Practice (the Code) remains a significant issue, causing concern among many suppliers.
Positive Trends in Supplier Treatment
The eleventh annual GCA survey, with over 3,000 responses, highlights a drop in the number of suppliers facing Code issues, decreasing from 36% to 33%. This improvement is a welcome development in the UK grocery sector.
The findings include:
- Cost Price Increases (CPIs): The survey showed a significant reduction in suppliers requesting CPIs, dropping from 91% in 2023 to 67% in 2024. Additionally, the percentage of suppliers experiencing issues with retailer responses to CPIs almost halved, from 28% to 16%.
- Invoice Discrepancies: The proportion of suppliers reporting unresolved invoice discrepancies fell from 25% in 2023 to 21%.
- Data Input Errors: Reports of data input errors not being promptly resolved decreased from 16% in 2023 to 11%.
The survey also introduced a new question about cost price decreases (CPDs). Only 5% of suppliers expressed concerns about how CPDs were requested by retailers.
Amazon’s Compliance Challenges
Despite the overall positive trend, Amazon’s compliance score with the Code fell from 59% to 47%. The GCA has urged Amazon to take swift and comprehensive action to comply with the Code fully.
Mark White, the Groceries Code Adjudicator, emphasized the necessity for Amazon to ensure suppliers understand the changes made since its designation and in response to these survey results.
“I am encouraged by the improvements in retailer treatment of suppliers, including the management of cost price increase requests and resolution of invoice discrepancies.”
“However, the survey indicates significant issues with Amazon’s compliance. Amazon must ensure that suppliers are aware of and understand the changes it has made in response to these survey results. Further changes may be necessary to ensure compliance with the Code.”
Compliance Performance Across Retailers
Overall compliance scores among the 14 retailers ranged from 98% to 47%, with an average compliance rate of 91%, slightly down from 92% in 2023. Excluding Amazon, the average compliance rate was 94%, unchanged from the previous year.
Notably, Co-op achieved the highest compliance score of 98%, showing a 2% improvement alongside Lidl.
Table summarizing the compliance performance of the top and bottom-performing retailers:
Retailer |
Compliance Score 2024 |
Change from 2023 |
|---|---|---|
| Co-op | 98% | +2% |
| Lidl | 98% | +2% |
| Amazon | 47% | -12% |
Next Steps and Annual Conference
The GCA will continue collaborating with the 14 retailers to address the issues raised in the survey. YouGov will conduct deep-dive interviews with suppliers to gain a deeper understanding of their experiences and challenges.
The GCA’s hybrid annual conference is scheduled for 1 October 2024. YouGov will present deep-dive results, and the Adjudicator will discuss responses to the survey. Additionally, there will be discussions on overcoming sector challenges.
Food for Thought
The GCA 2024 survey has brought to light significant improvements in the treatment of grocery suppliers by most retailers. However, the marked decline in Amazon’s compliance with the Code is a cause for concern.
Moving forward, it is essential for Amazon to address these issues and ensure fair and lawful treatment of its suppliers. The upcoming GCA annual conference will provide a platform to discuss these challenges and explore solutions for the future of the grocery sector in the UK.
In summary, while the UK grocery sector shows promising signs of improvement, there is still work to be done, particularly regarding Amazon’s compliance with the Groceries Supply Code of Practice.
Sources: THX News & Groceries Code Adjudicator.
