Grocers fall 'woefully short' in managing supply chains post-horse meat scandal, study shows

The Chartered Institute of Purchasing and Supply (CIPS), an international trade body and watchdog for buyers, suppliers and the procurement industry, said supermarkets have “fallen woefully short” in the management of their supply chains after surveying 100 senior supply chain managers across the UK.

In the last two months Tesco, Asda, Aldi and fellow grocers have found horse meat in products labelled as beef.

But although retailers have pledged they will overhaul supply chains and introduce new testing procedures, the CIPS warns companies will continue to be “found out” unless investors, analysts and boardrooms “place appropriate emphasis on the importance of their supply chain to their business and take steps to ensure they are fit for purpose”.

The survey found that 86% of supply chain managers believe regulators do not understand supply chains, while 36% claim their chief executive is not engaged with the potential risks in the supply chain.

In addition, only 53% of companies have a strategy to mitigate risk in their supply chains, according to The Telegraph.

The suppliers were split regarding the reason for the horse meat crisis, with 53% saying it was down to suppliers being squeezed by big supermarkets, but 47% disagreed.

Of those surveyed, 62% of companies said that they were treating potential risks in the supply chain more seriously after the discovery of horse meat.

CIPS chief executive David Noble said: “We hope this sorry tale will at the very least ensure supply chains are recognised as one of the most important aspects of a business and adequately scrutinised at every level.

“The reality is, supermarkets are among the most advanced supply chain managers in the corporate world and, though there are exceptions, many have fallen woefully short.

“It is only a matter of time before other sectors suffer a similar fate. These survey results are disappointing, but not surprising, given how few chief executives and boards take supply chain issues seriously.”