MORE Tesco fiascos: Now it's being investigated for alleged supplier mistreatment

Yet another problem for Britain’s biggest retailer

We’re almost tired of writing about Tesco’s problems. It seems every week a new story springs up about Tesco’s financial irregularities – but today it’s something different.

The supermarket giant is being investigated by a major watchdog over its relations with suppliers – with “reasonable suspicion” it mistreated its suppliers.

Christine Tacon, the Groceries Code Adjudicator (GCA), is tasked with ensuring supermarkets are following the rules in the treatment of their suppliers.

She suspects Tesco may have had problematic dealings with suppliers in a range of areas, in particular, but not limited to:

  • Short deliveries, including imposition of penalties
  • Consumer complaints where the amounts were not agreed
  • Invoicing discrepancies such as duplicate invoicing where two invoices were issued for the same product
  • Deductions for unknown or un-agreed items
  • Deductions for promotional fixed costs (gate fees) that were incorrect
  • Deductions in relation to historic promotions which had not been agreed

Tacon said she had “evidence that they were not isolated incidents, each involving a number of suppliers and significant sums of money.”

Tacon is investigating the period between 25 June 2013 (when the GCA was created) and 5 February 2015.

“The Groceries Code Adjudicator took the decision after considering information submitted to her relating to practices associated with the profit over-statement announced by the retailer in September 2014,” a statement from the GCA said.

 

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Readers' comments (3)

  • No surprises here Tesco shouts big on customer service but delivers little.

    Had some trainers from them turned out to be faulty (ok it happens no problem). However despite having a receipt showing how much I had paid they would only refund the amount they were selling for in a sale - nasty!

    Or the two Freeview HD Tuners purchased, they refused to refund or exchange despite not being able to be upgrade firmware to the recent Freeview changeover (only just over a year old.).

    Or suddenly you find they have done a deal with a supplier, and removed all the competition from the shelves - recently Anadin aspirin took over all the shelves, all 'white label' ones removed, with a massive price hike. Could give one a headache!

    I'm afraid Tesco's this day has been a long time coming!

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  • Hi Brian, thanks for the comment. Not sure if you're aware but particularly in the instance of the trainers, if the product is faulty, you're legally entitled to get a refund for the amount paid. Might be something to raise with them. Thanks

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  • Anonymous

    I was involved with a soft drinks company, we produced an own label drink for Tesco, because of problems with supply, they wanted to impose a fine of £250K! we had to settle on £60K. They were uninterested in the financial implications to us.

    They wanted to stock our own range of drinks, they wanted a listing fee of £140K to get into all stores, we would never get anywhere near making that much profit, this got negotiated down to £7K for 24 stores, needless to say we declined.

    A greedy, horrible company to deal with, they are getting what they deserve.

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