NFU conference 2013: All eyes on Tesco as CEO promises supply chain change

Tesco has pledged to source more meat from ‘closer to home’ as part of a raft of radical changes following the horsemeat scandal.

Speaking to farmers and industry professionals at the NFU Conference, Tesco chief executive Philip Clarke said the supermarket was implementing a “root and branch review” of its supply chains, which would involve introducing longer contracts, more transparency and the appointment of an agriculture director.

Mr Clarke vowed to source all fresh chicken sold in its stores from British farms from July, with an aim to source frozen chicken from “the British Isles”.

This represented “a genuine shift in how Tesco sources all the meat it sells,” he said.

He also pledged a commitment to sourcing British meat “where it is reasonable to do so”.

Declaring “the most radical change between a retailer and producers”, Mr Clarke said supply chins would be more transparent and equal. 
“Events over the last six weeks have been a wake up call for the whole industry,” he said.

Describing the supply chain as a “partnership” Mr Clarke said Tesco would be extending contracts to a minimum of two years, giving producers more security.

“It needs to be a true partnership as we’re only as good as the products we sell,” he told farmers.

Mr Clarke said heavy discounting at the consumer end was necessary when consumers were squeezed, but recognised that it was not sustainable.
Tesco will be appointing an agriculture director, which would be a single point of contact for farmers and would oversee the introduction of new development groups in vegetables, fruit and salads, he said.

While the announcement was generally good news, all eyes will now be on Tesco to deliver what it has promised, said NFU communications advisory group member Gillian van der Meer.

“The public were outraged by the horsemeat scandal and the supermarkets are in dangerous territory,” she said. “Where Tesco lead, hopefully others will follow.”

“It is also imperative the catering trade and public procurement take this on board and source from the UK. They always go for the cheapest – British food might not be the cheapest but it’s the best.”

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News from the NFU conference 2013

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