Sainsbury’s group is ‘model for industry’

Farmer supply groups, set up by Sainsbury’s, have been hailed by farmers and industry leaders as a model for the industry.

Sainsbury’s has pledged a further £40m over the next three years to its Development and Crop Sustainability Groups, whose farmers have already benefited from £21m of investment since 2007.

The announcement was made at the retailer’s Farming for the Future conference at Stoneleigh Park. The event was attended by about 1000 farmers, making it the largest farmer conference in recent years and a first for a major retailer.

“We want you to choose to do business with us,” Sainsbury’s chief executive Justin King told delegates. “We want your businesses to be successful. We do not have a sustainable business if our suppliers are not successful.”

The last quarter showed a growth over competitors of 3%, and this has risen by 25% over five years, he said.

Mr King announced that store space was set to swell by 8%. “This is the greatest phase of growth in our history. We want our suppliers to benefit from this.”

Sainsbury’s Dairy Development Group has been a key achievement for the retailer, said brand director Judith Batchelar.

Set up in 2007, it now has 343 suppliers who receive a premium for their milk and assistance to build their business. This includes laptops and software to help with benchmarking and two free vet visits a year to help improve herd health.

“The key is having great quality farm-specific data,” explained Ms Batchelar. “You can then create improvements. That’s driven the greatest change.” Fertility has improved and the calving interval has been cut across the group by 2.3 days, which is worth £0.5m to the producers and equates to a saving of seven tonnes of CO2.

Producers at the conference endorsed the support. David Jenkinson, producing 1.2m litres of milk in Oxfordshire, said the group had helped his business lift yield from 6000 to 8000 litres per cow over four years and reduce its electricity bills. “Sainsbury’s wants to help us improve and we’ve seen better returns despite a low market price.”

The model has now been rolled out over other sectors, a move welcomed by Somerset fresh produce grower Ken Coles. “We’ve traded with [Sainsbury’s] for 21 years and we’ve always been treated fairly and we’ve dealt with real people. They’re good at what they do and present our produce well in the store.”

The NFU commended the Sainsbury’s groups as a model for the industry. “These are the initiatives that allow producers to develop businesses for the future,” said deputy president Meurig Raymond.