Oireachtas Joint and Select Committees
Thursday, 18 April 2013
Joint Oireachtas Committee on Agriculture, Food and the Marine
Groceries Sector: Discussion (Resumed)
10:10 am
Martin Heydon (Kildare South, Fine Gael) | Oireachtas source
I thank the gentlemen for attending and for their interesting presentation. As a Kildare resident, I acknowledge the local employment provided by Aldi's Naas distribution centre. I welcome the announcement of further jobs.
According to our guests, Aldi has trebled its annual spend on Irish products in the past five years. From what base? They also stated that more than 50% of Aldi's grocery range was sourced from Irish suppliers. What percentage of non-grocery products are sourced from Irish suppliers? Mr. O'Connor referred to having 1,350 products. It was mentioned that Irish suppliers were sold in Aldi's UK, US and Australian businesses. Will our guests give an example of the products involved? I note the points on "Hello" money and dealings with suppliers.
Does Aldi run in-store promotions? If so, who pays for them? What is the opinion of our guests on competition in the grocery market?
Regarding labelling, I accept the point on recent events concerning beef products. Our guests stated that they had felt angry and let down by the suppliers in question. We are facing a challenge. When the horsemeat issue first broke, another multiple stated that it was selling burgers for 20 cent each, but it was purchasing those burgers from its suppliers for 8 cent. I am not claiming that this is Aldi's situation, but the multiple in question stated that it felt let down by its supplier. Morally, it could not stand over such a claim when it was only paying 8 cent for a product that was supposed to be a beef product and it knew that producing a burger for that price was impossible.
How much cognisance does Aldi take of pressures on suppliers? What is its response to the claim of the Irish Farmers Association, IFA, that retailers do not pay sufficient attention to the increasing input costs facing primary and middle producers? It has been stated that Aldi does not get involved in how producers work, but it deals with processors that have a relationship with primary producers. If there is a squeeze in that regard, it has an impact. This factor should be included in the mix.
My question on the code of practice has been asked, so I will change it a bit. Does the UK's code of practice incur more expenses than a code in Ireland would? What of the perception that some retailers extract higher profit margins from their Irish operations than they do from their other operations? Does Aldi publish its Irish-only profit margins?
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