The grocery market watchdog has ordered Tesco to make “significant changes” in the way it deals with suppliers after finding the supermarket had deliberately delayed payments to support its profits.
Christine Tacon, the Grocery Code Adjudicator, said Tesco had made serious breaches of the code governing the grocery market, but is unable to fine the supermarket as the breaches took place before her powers to fine were ratified.
“I was troubled to see Tesco at times prioritising its own finances over treating suppliers fairly,” Tacon said.
Tacon said she had seen internal emails suggesting payments should not be made ahead of a certain date in order to avoid missing margin targets. In some case this occurred despite suppliers’ requests for payment, at other times it was with their consent.