Co-op investigated for Groceries Code breach

The Co-op supermarket chain has refunded around a half million pounds to 110 of its suppliers. This follows a review of cases where suppliers were charged for benchmarking and quality control.

The retail group is being investigated by the Groceries Code Adjudicator, Christine Tacon. She has said she has “formed a reasonable suspicion that the retailer may have broken the Groceries Supply Code of Practice.”

The investigation into the Co-op will focus on practices that relate to de-listing and the introduction of benchmarking and quality control charges between early 2016 and at least summer last year.

The Co-op investigation will consider the extent, scale and impact of practices which may have resulted in suppliers being de-listed with no, or short, fixed notice periods unilaterally imposed by Co-operative Group without due consideration of published GCA de-listing guidance. The focus will be in relation but not limited to decisions taken between summer 2016 and summer 2017 as part of a project called ‘Right Range; Right Store’.

It will also consider the extent, scale and impact of practices which may have resulted in the introduction of charges without reasonable notice to suppliers. This will include but not be limited to the introduction of depot quality control and benchmarking charges to suppliers, especially those with fixed cost contracts.

In addition, the GCA will consider the retailer’s code-related training for its buyers and the culture contributing to the retailer’s approach to code compliance.

Jo Whitfield, chief executive of Co-op Food, said: “We care deeply about our relationships with our suppliers and we are very sorry that in these two areas we have failed to live up to our usual high standards. We are already addressing the issues with the GCA and our suppliers and we hope the investigation will help bring to light any additional cases so that we can put these right as quickly as possible.”