PPMA 2014

Fear of speaking out against supermarkets must stop

05-Oct-2014 - Last updated on 22-Jul-2024 at 15:35 GMT

UK manufacturers were behind their European counterparts when it came to automation

Manufacturers must speak out against the financial pressures supermarkets place on them if they are ever to invest in automation and improve their margins, an industry boss has urged.

“There is too much fear within the industry about speaking out against the supermarkets, but someone needs to step up and do it,” an executive close to the sector told FoodManufacture.co.uk at the Processing and Packaging Machinery Association (PPMA) show in Birmingham last week.

Supermarkets were partially responsible for the UK’s food and drink manufacturing sector’s poor uptake of automation, said the source, who did not want to be named.

‘Give a little back’

“They [the supermarkets] need to give a little back to allow their suppliers to invest in automation, because that’s the only way both sides can improve their margins,” he added.

The uptake of automation by Britain’s food and drink industry was poor compared to that of other European countries such as Germany, observed former cabinet minister and broadcaster Michael Portillo.

“One of the keys to moving [the sector] forward is automation and it’s patchy in British manufacturing, apart from the automotive industries,” Portillo told delegates at the PPMA’s opening seminar at Birmingham’s National Exhibition Centre.

“There are lots of companies at the PPMA show today who have complained that automation in the food and drink industry is backwards compared to some of the other EU countries, and they say supermarket pricing pressures are having an effect on that.”

Investment very poor

However, investment in UK manufacturing was very poor, claimed Christine Tacon, the Groceries Code Adjudicator.

This was frustrating as the sector was passionate about being leaner and trying to reduce its costs, she told delegates at her seminar titled ‘fairness in food’.

“The amount of investment in the UK manufacturing sector is very poor compared to the rest of Europe,” she said.

Meanwhile, Portillo urged food and drink manufacturers to think like businessmen of the 19^th century when the UK was the manufacturing centre of the world.

“I think we need to look back to that era because in the past we took advantage of how great we were.

“We opened up our markets to the world and all of that thinking needs to be reignited,” he said.