Agriculture contributes £9.9billion to the British economy and is responsible for employing 476 000 people (DEFRA, 2014). Its importance to the economy and increasing food security awareness has resulted in the development of Government led strategy to indicate how Britain can meet the challenge of feeding a growing population without damaging our natural environment. The strategies particularly focus on how it can position the UK at the forefront of the race towards sustainable intensification (DEFRA, 2013).
This and various other Government led strategy papers have focussed on driving change in the agricultural sector but do not fully recognise the position of power within the food supply chains of the British supermarket retailers. Supermarket sales account for approximately 80% of the UK fruit and vegetable market (EFFP, 2010) and as a result their technical and commercial requirements dominate the supply chain. Over recent years the changes in the UK supermarket retail sector have driven down margins, increasing the sense of desperation further down the supply chain. A recent fresh produce market report from Plimsoll shows that the industry average margin is only 1.5% and there is a growing divide between good and bad businesses. Of the 1156 companies in the marketplace, only 586 are considered strong. There are a further 129 companies who will make a loss for the second year in succession (Plimsoll, 2015). As a result fresh produce supply chains are driven by the need to survive, let alone thrive.
The impact of this is that the fresh produce supply chains are relatively powerless to influence any unsustainable behaviours of the retailers. As a result any Government, NGO or independently led strategy is unlikely to gain significant traction in this sector without full cooperation and engagement from the major multiples.
Each retailer has taken a different approach to its sustainability strategy. Companies such as Marks & Spencer have led the industry with their Plan A initiative which was launched in 2007 and has been followed by the larger multiples for example with Sainsbury’s launching their 20 by 2020 plan in 2011. These plans are far reaching across all supermarket operations and supply chains and are reported in the company Corporate Social Responsibility (CSR) reports. As a result the supermarkets each employ Agricultural or Sustainability Managers who are tasked with developing their associated agricultural strategies. Although the knowledge and expertise employed is strong and researches and shares best practices that can be employed, much of the activity within fresh produce fails to recognise the intrinsic influence of the retailer on the whole system for example the impact of their focus on shelf availability.