Grocery code to boost challenger brands

LONDON - British challenger brands will be bolstered in their fight against multinationals and supermarket own-label goods with the creation of a retail ombudsman and tougher code to boost competition.

Challenger brands: will benefit from a new code and ombudsman
Challenger brands: will benefit from a new code and ombudsman

The government announced last week that it is establishing a retail ombudsman to encourage "free and fair competition" and "make sure consumers are getting best value for money".

Experts say the ombudsman will give smaller brands the muscle required to get a good deal from supermarkets; big brand-owners can already do this due to their size.

A Food and Drink Federation spokesman welcomed the changes. "They will be of most use to small and mid-sized companies", he added.

The Competition Commission has also put its weight behind the ombudsman, which it said would benefit businesses by allowing them to "gain greater certainty about their contractual payments, which will lead to increased survival and greater investment".

Patrick O'Flaherty, co-founder at drinks company RDA Organic said: "The ombudsman creates a sustainable business and passes this on to the consumer. The code gives a new-found confidence and encourages us to continue working on new products and ideas."

Dave Wallwork, managing director at Feel Good Drinks, said: "The code of practice stops broad abuse of power and that can't be a bad thing."

However, he questioned whether a brand would be brave enough to take a case to the ombudsman.

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