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Food Producers Unite Against Retail Domination

by 5m Editor
14 May 2008, at 1:00pm

FRANCE - A seven-strong alliance of French food production industry bodies is opposing proposed legislation that would remove such protection as the current law affords from unreasonable retailer demands.

A law passed earlier this year, the loi Chatel, required all commercial co-operation to be invoiced and accounted for transparently: this is about to be dismantled before becoming fully operational.

Many French farmers and co-operatives supply supermarkets directly.

The farmers' union FNSEA and the agricultural co-operatives' body Coop de France is joining forces with food manufacturers' association ANIA (representing 10,400 food companies), brand owners' institute ILEC, and three other business associations.

In March, this group agreed to drop its requirement for unified price lists, on condition that commercial co-operation would become a properly accountable aspect of doing business.

French finance minister Christine Lagarde is preparing to allow supermarkets to drop the system of year-end discounts which they instituted many profitable years ago, but which they stopped wanting if it had to be fully accountable.

Instead, they will be able to fix a fully-discounted price at the beginning of the year, while suppliers cannot see how the new law will allow them to claw back inevitable spontaneous demands for promotional stock or requests for marketing support.

By 'simplifying' the current set of checks and balances, FNSEA and Coop de France are concerned by the probability that retailers will no longer be required to invoice or account properly for their demands, well-founded or not. The National Assembly's rapporteur for this law, Jean-Paul ChariƩ, said in a briefing that: "...farmgate prices have gone down by 50% while supermarket prices have risen by 30% for these same products."

5m Editor