Economics
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- Date Submitted: 04/01/2011 03:40 AM
- Pages: 5
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Critically evaluate the ethical trading practices of Tesco towards their UK grocery supply chain. Highlight the current issues and make recommendations for the future.
The distribution of value and power within food supply chains is an issue that is generating much attention from consumers, NGO’s and the Competition Commission. There has been much consumer interest surrounding the issues of fair trade with the success of the brand being worth over £92m in the UK alone (Cooperative Bank web page 2008). Fair Trade primarily concerns third world countries and helps the producers of UK commodities such as coffee, chocolate and bananas to build a profitable and sustainable future. This is mainly achieved through the supermarkets offering a fair price for their produce and the acceptance from the retailers to stock the lucrative trade mark which the produce carries. There are concerns however, that UK farmers who supply supermarkets are not receiving a fair price for their produce and are under extreme pressure to meet the supermarkets rigid demands. General bad practices through out the supply chain are emerging issues that are generating consumer interest of which little transparency on the supermarkets behalf is evident. Other issues on an economic platform concern the sustainability of the UK agricultural sector which focuses on tenant farms going out of business, a narrowing down of UK food suppliers and an increase in unemployment in rural areas. It is estimated that UK agriculture provides 63,000 jobs (Green healthy and fair, Sustainable Development Commission (2008). In order for supermarkets to become more ethical and consequently remain competitive, it is imperative they address the emerging issues that fair trade begins at home.
Currently it is estimated that 88% of all UK food is sold through a small handful of supermarkets with Tesco being the market leaders (Norman Baker March 2004). This equates to market sales of over £62bn per annum (Fair Trade...
The distribution of value and power within food supply chains is an issue that is generating much attention from consumers, NGO’s and the Competition Commission. There has been much consumer interest surrounding the issues of fair trade with the success of the brand being worth over £92m in the UK alone (Cooperative Bank web page 2008). Fair Trade primarily concerns third world countries and helps the producers of UK commodities such as coffee, chocolate and bananas to build a profitable and sustainable future. This is mainly achieved through the supermarkets offering a fair price for their produce and the acceptance from the retailers to stock the lucrative trade mark which the produce carries. There are concerns however, that UK farmers who supply supermarkets are not receiving a fair price for their produce and are under extreme pressure to meet the supermarkets rigid demands. General bad practices through out the supply chain are emerging issues that are generating consumer interest of which little transparency on the supermarkets behalf is evident. Other issues on an economic platform concern the sustainability of the UK agricultural sector which focuses on tenant farms going out of business, a narrowing down of UK food suppliers and an increase in unemployment in rural areas. It is estimated that UK agriculture provides 63,000 jobs (Green healthy and fair, Sustainable Development Commission (2008). In order for supermarkets to become more ethical and consequently remain competitive, it is imperative they address the emerging issues that fair trade begins at home.
Currently it is estimated that 88% of all UK food is sold through a small handful of supermarkets with Tesco being the market leaders (Norman Baker March 2004). This equates to market sales of over £62bn per annum (Fair Trade...