After many months of negotiations, I’m proud to say we’ve done it. We have developed the Grocery Supply Code of Practice for Canada, an agreement that should be readily acceptable to all retailers and supplier partners. It’s a day that many in the industry thought would never happen.
This code doesn’t discourage hard bargaining. It doesn’t take away parties’ rights to contract freely. It merely adds structure and openness to the process. A win-win. A solution that helps keep jobs, head offices, innovation and manufacturing in Canada.
In order for this landmark code to work, all players in the sector need to participate and be held accountable. Empire and FHCP have submitted the Grocery Supply Code of Practice for Canada to the federal, provincial and territorial ministers of agriculture working group, and look forward to input from other grocery retailers across the country. It’s clear we need government help to properly administer the code. That’s not to say governments should structure it. That should be left up to industry members who understand the sector, and that’s why we took the lead.
There’s precedent for this, too. In the United Kingdom, retailers were initially opposed to a code that was imposed by the British government. Today, they applaud it.
We see our code of conduct as one similar in spirit to the U.K. code, with some made-in-Canada differences. To start, ours has been built on collaboration between suppliers and retailers, whereas the code in the U.K. was written by government. That’s a key difference. Ours is balanced and promotes openness, rather than decreeing outright prohibitions. It addresses actual concerns suppliers have had for years related to payment terms, promotions and forecasting, and allows all parties to negotiate in a way that works best for their businesses. Is it crazy to think that suppliers should be paid in full for the product their retailer partners order? Can’t we all agree that unilateral, unexpected and sometimes retroactive changes are downright unfair?
This is an excerpt from a commentary by Michael Medline, chief executive of Empire Co. Ltd., Canada’s second-largest grocer with a diverse family of banner brands, including Sobeys, Safeway, IGA, FreshCo, Foodland, Thrifty Foods, Farm Boy and Voilà.