(The online newspaper): At the autumn meeting of food suppliers in Tønsberg, director Tor Erik Engebretsen of the Norwegian Food Safety Authority took the magazine out of his mouth. He just asked the grocery players to get together.
– Sharpen yourself! Look at the results on how you can improve, Engebretsen tells Nettavisen.
The background for the statement are the results of The investigation by the Danish Food Safety Authority on the negotiating climate between food suppliers and food chains.
Allegations of a culture of fear in the industry
– Culture of fear is a very strong term, but that does not mean that there are no unpleasant inconveniences or that there is misconduct in the industry, the director of the Norwegian Food Safety Authority, Tor Erik Engebretsen, told Nettavisen.
Emphasize that you have a strong definition of a culture of fear. Therefore, he won’t go so far as to call it a culture of fear, but he still believes the industry has a lot to clean up.
– If the survey had been conducted 15 years ago, it would have been worse than this survey shows, he says.
It is the first time in the history of the Norwegian grocery that the relationship between food suppliers and grocery stores is examined. The investigation is the result of food suppliers claiming to have been exposed to harassment, extortion and malpractice from food chains for years.
Every fall, grocery suppliers like Tine, Nortura or Stabburet have to negotiate prices with grocery giants like Norgesgruppen (Kiwi, Meny, Spar, Joker), Coop (Extra, Coop Mega, Matkroken), and Rema. This is colloquially called a harvest hunt,
In negotiations between suppliers and supermarket chains, everything revolves around the price. Suppliers want the highest possible price for food to sell in the supermarket, while grocery stores do their part to buy as many items as possible at the lowest price.
The talks of the so-called autumn hunt have been the subject of a series of claims that suppliers are allowing themselves to be pressured on the price for fear of not letting the goods into the shops.
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Negotiated contracts worth billions of dollars
In the survey on the actual position of the legislation on good business practices in the sector, 241 food suppliers and 67 food chains responded to the survey.
Preliminary results from the survey, which were unveiled on Thursday, show that much of the industry’s ignorance hasn’t changed, says Engebretsen.
– When you look at the survey results, you understand that some people are anxious, he says.
And it’s not a small change that is negotiated when food suppliers and grocery chains sit at the bargaining table. For many, it can involve contracts worth many billions.
The Norwegian Food Safety Authority therefore finds it alarming that about half of the suppliers who negotiate with Rema 1000 and Coop say that not all information is provided at the time of signing contracts.
– What do you say about the negotiating climate in the sector?
– He says there is skepticism on both sides of the negotiating table. I think it’s stuck from the previous culture of fear in the industry, even though there aren’t many of those players left in the industry anymore. But much of your negotiation can be left behind, she says. The swamp.
While billions of players may be at stake, the recent survey shows widespread use of oral agreements.
– I am very surprised that it is so widespread, but we still don’t know exactly what the background is. In the preliminary report, it is also noted that the benefits promised to suppliers are not always met, he says.
It could be, for example, that a grocery supplier is promised a promotion in negotiations that is not honored by chain stores.
– Grocery stores promise too much, which worsens relations, says the Danish grocery inspectorate.
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Reitan Retail: – We have to do it seriously
Rema 1000 is among the food chains that do the worst with food suppliers. Kårstein Eidem Løvaas, contact authority of Reitan Retail, says that Rema 1000 takes criticism seriously.
– If an inspection says you should tighten, you have to take it seriously, he tells Nettavisen.
– How would you comment on the claims about a culture of fear?
– We can do a lot to eliminate the word culture of fear, probably before there was more. Preliminary survey results show that the industry is moving in the right direction, says Eidem Løvaas and points out that they appreciate the fact that food business operators can have an open dialogue with the Norwegian Grocery Authority.
So far, Reitan Retail will not comment on the results, which involve not all the information put on the table in the negotiation and the widespread use of oral agreements in contracts that can be worth billions. But he believes the report may be the start of a better cooperative climate in the industry.
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– Can contribute to healthier competition
Mette Hanekamhaug is communications manager at the Danish Grocery Suppliers’ Association (DLF). DLF is an organization of interest to independent brand suppliers in the food and catering market.
– The survey is an important basis in the work on healthier competition in the food market. It will be interesting to follow its development over time, now that it will be carried out annually, he says and adds:
– The questions address the challenges of the food market. Engebretsen says the industry has great potential for improvement in several sectors. We’re glad the supervisory director is so clear in his appeal to grocery players, he tells Nettavisen.
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