The UK government announced last night that it is temporarily relaxing elements of competition law as part of a number of measures that aim to help the supermarkets keep their shelves stocked during the coronavirus crisis.
The move allows retailers to share data with each other on stock levels, cooperate to keep stores open, or share distribution depots and delivery vans. It would also allow retailers to pool staff with one another to help meet demand.
Amid reports that panic buying is continuing despite industry assurances that there is no shortage of food in the system, Environment Secretary George Eustice confirmed elements of the law would be temporarily waived after a meeting yesterday afternoon with chief executives from the leading supermarkets and industry representatives.
The government has also temporarily relaxed rules around drivers’ hours, so retailers can deliver more food to stores, and is waiving the 5p plastic bag charge for online purchases to speed up deliveries.
Eustice said: “We’ve listened to the powerful arguments of our leading supermarkets and will do whatever it takes to help them feed the nation.
“By relaxing elements of competition laws temporarily, our retailers can work together on their contingency plans and share the resources they need with each other during these unprecedented circumstances.”
Andrew Opie, Director of Food & Sustainability at the British Retail Consortium, welcomed the move, adding: “Retailers have been working hard to ensure shelves are stocked and this is an exceptional step taken by the government to help retailers and their suppliers cope with problems that might be caused by widescale absences across the supply chain.
“This is a short term measure, in the spirit of working together, and will allow retailers to agree common specifications for products to bolster food production, and co-ordinate certain operations to ensure customers anywhere in the UK have access to the essential items they need.”
However, reports suggest that the main grocers want the rules relaxed even further so that they can work together on securing the supply of essentials, including the easing of grocery code regulations. They also want less restrictions on the weight of goods that delivery vans can carry and an easing of national minimum wage regulations.
Supermarkets and their supply chains have been buckling under the strain of customer behaviour in the face of coronavirus outbreak. As well as rationing some items, several chains are cutting back on their product ranges to make it quicker and easier to restock shelves with items in high demand. Retailers have also been preserving certain store opening times for elderly and vulnerable customers.
However, there have been warnings that the next potential weak link in the supply chain is at food manufacturers themselves. If production gets hit by staff absences, that will mark the beginning of a new and potentially serious problem for the industry.
NAM Implications:
- All stakeholders now have a common purpose…
- …and all stakeholders appreciate that any perceived opportunism will be construed as such.
- So pragmatism rules.
