Empire, the parent company of Sobeys and Iga, has officially become the first retailer to join the new Grocery Code of Canada. The work continues to develop governance rules for members for its full implementation by January 1.
The Driving Code office for the grocery store sector (BCCSPé) indicates Wednesday that the manufacturer of Lactalis Canada dairy products has also become the first supplier to join the code.
The code of conduct aims to promote fair trade relations between grocers and their suppliers, in particular with regard to the application of penalties and fees, in order to increase transparency, equity and predictability within the industry.
All the main Canadian grocers – Empire, Loblaw, Metro, Walmart Canada and Costco – had confirmed their support for the voluntary code in July 2024. However, this week marks the opening of official registrations.
The president and superintendent of the office, Karen Proud, explains that official recruitment efforts should start this fall this fall, once the governance documents of the finalized code, such as its administrative regulations, its operating rules and its official conflict resolution mechanism.
This is a smooth launch of the code. Since this week, a new website and a member portal have offered access to orientation documents, updates and a secure space allowing members to interact with the Bccspé.
Development still in progress
Contributions will not be collected until the beginning of next year, which means that companies will be able to register officially in 2025 at no cost for the rest of the year.
With the launch of today, everyone can register in the office, become a member, become part of the code, and submit and report informal problems that the office will begin to examine
explains Ms. Proud during an interview.
According to Henry Chambers, the first vice-president for Canada and the Americas of the Sentinel MC consulting company, established in the United Kingdom, this is a key step in the process.
The code aims to promote fair trade relations between grocers and their suppliers.
Photo : Radio-Canada
Mr. Chambers indicates that his firm has trained more than 60 Canadian companies of consumer goods wrapped in the last six months to prepare for the arrival of the code, drawing inspiration from the lessons learned from other countries with similar codes, such as the United Kingdom and Australia.
The code takes time. It is not an instant piche to say: ” Everyone behaved like this, you behave now like that, be well intended and continue ”
he explains.
If you look at the recent data that has just been published in the United Kingdom, we are at 13 and the trend is better? Yes, this is the case. The retailers deal with the sellers in a completely different way and, if I dare say, less barbaric than before the existence of the code.
Ms. Proud adds that work continues before the expected increase in the number of members. These include finalizing the statutes and rules defining the operation of the office by the end of the summer.
The office also designs its dispute settlement mechanism, which will governing complaints treatment, including the consequences of code violations.
It is the most important part of governance to finalize, and we are on the right track, thanks to a working group made up of industry representatives
says Ms. Proud, adding that she expects the document to be finalized by September.
It is only once it has been finalized, that we have had time to educate people and that they will have had time to integrate it into their business, that we can launch the formal resolution of disputes.
Not a miracle solution
Michael Medline, chief executive officer of Empire, was the first manager of a great food player to claim a conduct code in order to standardize the rules of the game for grocers and Canadian suppliers.
He warned that the code would not constitute a miracle solution to solve industry problems, but that it could lead to a drop in prices, shorter supply chains and a larger choice for Canadians.
Michael Medline, chief executive officer of Empire.
Photo: Reuters / Mark Blinkh
The implementation being now firmly initiated, this code represents a commitment to promote more solid and fair partnerships throughout the supply chain, while creating a long -term value for all the parties concerned – suppliers to consumers
underlines Rob Allsop, vice-president of the national supply and the commitment of Sobeys suppliers, in a declaration.
The food industry is at a pivotal time, and Empire is proud to participate in this important step and is delighted to continue its collaboration with the stakeholders in the supply chain in order to create a significant and lasting change.
Controversial
The sectoral committee responsible for drawing up the code was created in response to the controversial costs invoiced to suppliers by large food retailers, a problem which reached its climax in 2020 when Walmart Canada and Loblaw each introduced new supplier costs to finance their investments in infrastructure.
A Lactalis Canada factory located in the Grand Sudbury
Photo: with the authorization of Lactalis Canada
Some grocers first hesitated to join the code, but the federal government warned that it could make it compulsory if all the main players do not adhere to it.
Ms. Proud hopes that the implementation of the code will create greater confidence between actors in order to truly strengthen the Canadian food sector
.
Although its results can in particular help small producers find more outlets for their products, it adds that consumers should not expect the code solving code that escape their control.
I think there has been a lot of disinformation that the code went in one way or another to solve food inflation. This is just not the case
she recalls.
Many other factors contribute to the price of food. This code has never been designed to solve this problem. It actually aims to create a more efficient, more collaborative Canadian industry, more based on trust, which will only help small grocers and independent suppliers to do business in Canada.
