Scotland’s National Farmers Union (NFU) has again called for the creation of a supermarket ombudsman, so that suppliers get a fairer deal from supermarkets.
President Jim McLaren said that supermarkets disguise their relationships with suppliers as being mutually “beneficial partnerships” but in reality these are often “one-sided”.
He commented: “The retailers hold all the power and suppliers are squeezed to within an inch of their economic lives.”
The warning came after various reports of supermarkets demanding new terms from suppliers, including alleged alterations made by Tesco.
McLaren said there is evidence supermarkets are abusing their power and taking advantage of the credit crunch to discount many items – meaning suppliers fund the cuts.
He said: “These include over-riders where suppliers are made to pay for shelf space on terms that change at will, last minute alterations to payment terms and timescales and the use of promotions paid for by the supply trade.”
Some UK retailers, including Tesco and Asda have so far resisted the introduction of an ombudsman, as recommended by the Competition Commission in April this year.
Earlier this month, the NFU in England said supermarkets are increasingly “beating up” suppliers to remain competitive during the recession.
