The one that I solved is what I call forensic auditing, which is when the retailers use no-win, no-fee auditors to go back six years—they were using very sophisticated software to go through emails going back that far—looking for evidence that the supplier might owe them some money and then whack them with an invoice for it. That is allowed under contract law. In many cases, the retailers threatened to deduct the money or actually deducted it from payments that were due. This relates to the no delay in payments issue that I am currently investigating.
I had so many complaints about that issue that I said to the retailers that they surely should have systems that are able to sort those matters in the current financial year plus two. Eight out of 10 of them have agreed to do that, so I have now taken that off my top five issues, but it was a main one on which I had major progress.
Drop and drive, which I explained earlier, is another one.
Forecasting is another. Many retailers issue penalties for short deliveries and I have challenged them on what they forecast. We all know that the weather changes but, if the retailers forecast 4,000 units and then ask for 6,000 when the order comes through, and if the suppliers give them 5,900, they cannot fine the suppliers for the 100 that they did not manage to pull off. All the retailers now have a big piece of homework from me on the accuracy of their forecasts. Interestingly, I hear from some retailers that they do not even have systems that talk to each other to compare their forecasts with their orders.
Another issue was demand for lump sums, which I hear about very frequently. Some of them are swept up in end-of-year margin maintenance agreements but, sometimes, it is just a case of the retailers having a black hole that they need to fill and needing some money. That is a significant issue.
Another issue that I think people found more annoying than hugely prohibitive was being overcharged for artwork or photography. The retailers were telling suppliers who they had to use, particularly for packaging of own-label fresh produce. There was a preferred supplier list of one, who would charge the supplier more than they thought they could get the artwork for externally.
Having dropped the forensics off my top five, I have now introduced the cost of customer complaints. If somebody takes back a carton of milk and says, “This milk was off,” the retailer will generally give them their money back and another carton of milk, but they will then trace it through to the supplier and probably charge them £45 for the complaint. Knowing what they received for the milk, we can see that that is a lot. They all have another piece of homework to find out for me what they are charging for customer complaints.
Those are the issues that I have been working on for the past 18 months. I have not needed investigations because I have been getting progress on them, and I have not needed the penalties, but those are parts of my armoury when I need them.