22nd Mar 2005 12:03
Tesco PLC22 March 2005 TESCO RESPONSE TO OFT SUPPLIER CODE AUDIT Tesco today welcomed the fact that the Office of Fair Trading (OFT) had found nobreaches of the Supplier Code at Tesco. As the OFT published the results of its independent audit of the Supplier Codeof Practice, Tesco announced that it will be appointing a Code ComplianceOfficer and has invited its UK suppliers to provide anonymous feedback onworking with Tesco. Welcoming the OFT's findings, Chief Executive, Sir Terry Leahy said: "We are pleased that the audit found no single instance of a breach of the Codeat Tesco. Our compliance with both the spirit and letter of the Code encouragesstrong supplier relationships. That is not to say problems do not arise - theydo, but our close relationships with suppliers mean that these are aired andusually resolved by constructive discussion. "The OFT agrees that consumers benefit from vigorous competition for supplies onboth quality and price and there is nothing to suggest that the market is notworking well for consumers. "We agree with the OFT that suppliers should not be apprehensive aboutcomplaining to us. As the audit shows, suppliers do take up issues with usregularly and to support this process we will be appointing a Code ComplianceOfficer to hear formal supplier complaints, confidentially if requested. "We also want to know what suppliers think of Tesco and how they find workingwith us. To achieve this we have launched the biggest supplier survey of itskind, sending out questionnaires to our UK suppliers. The results will help usunderstand what is good and where we can improve." "The OFT has an ongoing responsibility to consider competitive conditions underthe Enterprise Act 2002 and we note their request for information in thiscontext." ENDS For further information please contact Jonathan Church in the Tesco Press Officeon 01992 644645. Out of hours please contact the duty press officer bytelephoning 01992 644733 and selecting option 2 from the voicemail menu. Notes for Editors: 1. The new Code Compliance Officer will be a senior, fair minded and objective individual who will hear formal supplier complaints and, where required, attempt to resolve the issues. 2. The supplier questionnaires were based on the successful Tesco staff Viewpoint process whereby all staff provide anonymous feedback on working at Tesco. The data is then used to produce action plans for managers. 3. Tesco has more than 3000 UK suppliers. The following are just some examples of how good relationships have brought benefits to suppliers, customers and Tesco: Hedon Salads, salad supplier Hedon Salads was set up in 1993. Two years ago they began working with Tesco ona project to extend the growing season for cucumbers from nine months a year toall year round, including by installing a Combined Heat and Power (CHP) system.The number of cucumbers harvested doubled in the first year, enabling cucumbersfrom Yorkshire to replace imported Spanish cucumbers. The project is nowcompleting its second full winter season with strong year-on-year growth. Glenrath, egg supplier Glenrath won their first contract to supply Tesco in 1983, supplying eggs for asmall number of our Scottish stores. Over time their contracts with Tesco havegrown, and they now supply eggs for stores throughout Scotland and NorthernEngland. Twenty years of organic growth with Tesco has enabled Glenrath to builda £25m turnover, producing over 1.2m eggs per day. Over the last decade Glenrathhave invested £17m into new, state of the art technology and facilities and havegrown to become Scotland's largest independent egg producer and packer. Long Clawson Dairy, cheese supplier Farmer's co-operative Long Clawson Dairy has worked closely with Tesco todevelop varieties of quality cheese, including Blue Stilton, Cotsworld, and anOrganic range. Since 2001 their business with Tesco has grown from £7.6m to£11.4m, and has now reached around 40% of their turnover. Building theirbusiness with Tesco enabled Long Clawson to invest £7m in new plant andequipment during 2004. Long Clawson are not content with building their UKpresence. They recently joined Tesco at a Food and Drink Showcase at the BritishEmbassy in Prague. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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