The Groceries (Supply Chain Practices) Market Investigation Order 2009 (the “Order”) has been in force since 4 February 2010.
The Order implemented the Groceries Supply Code of Practice (the “Code”) which applies to thirteen designated grocery retailers, including Asda, and governs our dealings with grocery supplier partners.
Every year we submit an Annual Compliance Report to the Competition and Markets Authority (the “CMA”) and the Groceries Code Adjudicator (the “GCA”) to detail our compliance with the Code, any alleged breaches of the Code and any Disputes with suppliers.
We delivered our tenth report, covering the period from 1 January 2020 to 31 December 2020, to the CMA and the GCA on 30 April 2021.
Supplier feedback and steps taken
We are pleased by the results of the GCA’s 2020 Annual Supplier Survey. Over the six years that the GCA survey has been in place, we have seen significant improvements in supplier perception.
In 2020, 94% of our suppliers believed that we comply with the Code ‘consistently’ or ‘mostly well’, we were also ranked second for how we conduct our supplier relationships and third out of thirteen designated retailers for our overall compliance with the Code. Asda is pleased with the results, however, we continue to identify and implement improvements to existing practices. For example, we take the time to reflect on any Code-related issue which a supplier partner raises, to ensure we have the best processes in place or identify how we can continue to improve our supplier partner experiences when working with Asda.
The impact of the Covid-19 pandemic over the course of the past year has had a considerable impact on both Asda and our suppliers. We have provided support to our supplier partners, including via regular communications (for example, holding virtual supplier conferences) with suppliers around what changes we have made, as well as providing a dedicated central contact point for suppliers to share feedback.
To support suppliers during the ongoing pandemic, Asda and IPL shortened the payment terms for our smaller suppliers, to help mitigate any cash flow challenges during this time.
Further improvements Asda has introduced in the past year include:
- The introduction of additional guardrails with respect to how we handle and approach post-payment claims, to further facilitate positive engagement and successful resolution of these claims.
- The launch of a two-stage appeals process to supplement Asda’s Good Faith Receiving programme. This was introduced in partnership with suppliers and the Simply Supply Chain group, to ensure that the appeals process adds tangible value to suppliers.
- The adoption of new operational and strategic approaches applied by Asda’s Supply Chain team when collaborating with supplier partners. Within Asda’s supply chain we have enhanced our communications and supplier training, and invested resource to focus on longer-term supplier development and relationship management. This includes the introduction of specialist Collaboration Analysts across the Operational Supply Chain team, and the launch of our Supply Chain Collaboration Board, where Asda and suppliers jointly define priorities and agree on projects to work on together.
- Enhancements to existing forecasting processes and operations. For instance, Asda has obtained full value from sales forecasting which has been facilitated by the introduction of specialist Demand Planners. This has proven to be vitally important, given the unique challenges posed to forecasting accuracy, ordering and product availability during a global pandemic.
In response to the changes caused by the Covid-19 pandemic to Home Office work operations, we adjusted the GSCOP training and awareness programme for our colleagues, moving away from the traditional classroom-based learning experience. We introduced a new online platform for Asda buyers which contains a wealth of guidance, training and awareness materials to support our buyers with Code compliance.
During 2020, 160 buying colleagues received Asda’s GSCOP computer-based learning module and one colleague completed the learning module in early January 2021; all 49 IPL buying colleagues completed at least one form of Code related training. Utilising technology, Asda and IPL continue to provide training to a wide range of areas of the business, extending beyond the Buying team to support whole house compliance. During 2020, Asda and IPL provided bespoke and virtual training modules to colleagues from the Logistics, Supply, Technical and Finance teams.
Reportable Issues in the Annual Compliance Report
We received 31 alleged breaches in 2020. Of these, twenty have been successfully resolved within the reporting period. An additional six alleged breaches were subsequently resolved in early 2021.
One alleged breach which initiated in 2020 proceeded to a formal Dispute, as defined under Article 11 of the Order.
Contact Asda’s Code Compliance Officer
Given the challenges posed by pandemic over the past year, we value and are immensely proud of the inter-dependent relationship that has been established with our supplier partners.
Asda’s Code Compliance Officer encourages open and honest feedback with respect to how we are adhering to the Code. Supplier partners are encouraged to contact Graeme Morrison, Asda’s Code Compliance Officer, at email@example.com, which will help ensure that any Code related concerns can be addressed as a priority.
Date: 30 April 2021