Coles/Wesfarmers For many years the Australian grocery sector has been dominated
ID: 383105 • Letter: C
Question
Coles/Wesfarmers For many years the Australian grocery sector has been dominated by two major players Coles and Woolworths (Safeway). Over the last decade or so both companies have been subject to scrutiny with regard to supplier management and there have been many negative claims made. There are a large number of newspaper and journal articles related to the way the company engages and works with its suppliers. In 2011, the ACCC brought charges against Coles for unconscionable conduct in dealing with suppliers and was found negligent. In response, the company appointed the former Victorian Premier Mr. Jeff Kennett as an independent arbiter to engage with suppliers and oversee disputes. Currently Wesfarmers (Coles) has 15,000 suppliers. For this research project, you will need to conduct an extensive search online. There are many newspaper and journal articles freely available online and you can also access the company website as well as many of their supplier websites.
1. What is the Coles ‘Nurture Fund’? a. Why do you think it was established? b. What impact do you think it will have? c. Do you think it will achieve the outcomes the company really wants?
2. Obtain a copy of the Coles ‘Supplier Charter’ and the ‘Supplier Charter Framework’ that was implemented in 2014 and the new Supermarket Code of Conduct (2014). a. What is the purpose of these documents? b. With regard to suppliers, how similar or different are these two codes?
Explanation / Answer
1. Coles Nature Fund is a fund built to support small and medium size food and grocery production. This fund will help MSE producers to make use of latest technology, create new products and conduct research and development. A. It was established to strengthen Coles relationship’s with suppliers, build long term relationship with them and to support them financially to grow as an organization b. It will have a positive impact on Coles’ relationship with suppliers. Further it will help supplier with a source of additional capital for their new ventures/product lines. C. yes, I think it could achieve the desired outcomes. This is because all suppliers would want healthy relationships with the company and vice-versa. The Nature Fund is a good opportunity for both Coles and the producers to establish a long-term relationship.
2. a. These documents have been created to showcase the ethics and business values of Coles and it wishes to engage with suppliers. The supplier charter also lays down mechanism for grievance redressal in case of conflict and disagreements. Food and grocery code of conduct is a general charter, which can be voluntarily followed by any retailer or wholesaler who wishes to abide by the guidelines of the charter. The code lays down guidelines for effective and transparent dealings amongst suppliers, retailers and wholesalers. B. With regard to supplier, Supermarket code of conduct offers more protective and clear guidelines. The coles framework is more personal in nature and is a broad view of what the suppliers can expect. Supermarket code of conduct, sets out minimum obligations on part of retailers and wholesalers. However, both frameworks are non- actionable and cannot be used to fight a legal battle.