Oireachtas Joint and Select Committees

Tuesday, 5 March 2013

Select Committee on Agriculture, Food and the Marine

Retail Sector: Discussion with RGDATA and Retail Ireland

3:10 pm

Mr. Richard Nolan:

As a Dublin man, I never thought I would get the opportunity to praise and compliment Deputy Healy-Rae. However, he hit the nail on the head in his contribution. Deputy Ó Cuív raised some interesting observations, to which I would like to reply. Mr. Foy and I are at the opposite ends of the spectrum and, as I explained in my presentation, I am not affiliated to a group in any way. Mine is a family business that has been trading now for 55 years. Today, it would not be possible for my business to open as an independent retailer without being part of a symbol group here.

I extend to the Chairman the same invitation I extended in this room a number of years ago. My independent business is unique and I would be more than happy for the committee to come out and see what we do and how we do it. Although I come from farming stock in Sligo and Wexford, as a Dublin retailer I have no sympathy for the farming community whatsoever. Meat and dairy issues have been a legacy issue between farmers and retailers for a long time. We sell our potatoes either too cheaply or too expensively and in the meantime, most IFA housewives shop in the local Aldi or Lidl and complain about bacon, vegetable and cabbage prices in the Sunday papers. There is a huge moral debate on the issues in this regard.

With regard to making decisions, I do not have to make decisions with any wholesaler and our decisions are instant and final. The issue of pricing in the Republic compared to that in the UK was raised. If one compares prices on the Tesco UK website with prices on the Tesco Ireland website, one will sometimes find a price difference of up to 50% for the exact same product. I cannot say why that is the case. However, in 2009, as an independent operator we changed our source of supply. We had been dealing with indigenous Irish wholesalers, which in most cases were simply agency people bringing products in from the UK and elsewhere and redistributing them here. In 2009, we began to deal directly with a co-op in the UK called Nisa. That decision is the reason I am still in business today.

The difference in pricing between the UK and the Republic in some cases is criminal. I put this down to a number of factors. The question was asked as to why a product was a certain price in Northern Ireland. Historically, in the UK there has been a certain attitude towards the Republic of Ireland. It is seen as a different domain and on that basis it is of secondary importance to whatever is happening in the UK market. I could go into great detail on that, but I do not think we have the time.

Labelling is an issue with which I have a major problem. I know for a fact that I can bring in Thai chicken and simply dust it in breadcrumbs, put it on a tray, wrap it in cellophane and stick a Bord Bia label on it. That is wrong, but it is something that would be very simple to resolve. I am not sure what efforts are being made in America to establish transparency, but I do not understand the fixation here on how much money retailers are making. I am not a charity. I am in the business to make money. Walmart is the largest retailer in the world and it makes billions. Tesco publishes its figures every year. Ms Buckley made some important comments with regard to this in her submission. The ethos of those companies is to make money.

Reference was made to the liquid milk business, but I do not know much about it. I put it to the committee that there is a close affinity between the cost of milk and share prices. If one was a shareholder in Glanbia, one would have been very pleased with the performance of its shares over the past 18 months. I am sure many farmers are shareholders in Glanbia. However, if one wants to know why farmers are not getting paid enough for liquid milk, one should look at how much Glanbia pays them and how much money that company makes.

A comment was made with regard to the irregular size of fruit and how difficult it was to make a comparison between that issue and that of liquid milk producers. The situation is not funny. In London's famous fruit and vegetable market, for example, a recent exercise found that some 500 tonnes of perfectly good food is thrown out every week because somebody in a multiple somewhere decides, for example, that a lemon must be a certain shape, size and colour before it is suitable for sale. The amount of waste involved in this is scandalous in this day and age.

The issue of artisan producers is important. We were one of the first retailers to involve ourselves with artisan food producers, and west Cork farmers were one of the first artisan groups we dealt with. It was quite a funny situation, because we had to move from a beards and sandals, Dinny and Miley from Glenroe, type of arrangement, where they bought half a dozen eggs in the local supermarket, brought them back to the farm, covered them in dung and feathers and sold them as free-range eggs. At the other extreme, we had people who were totally passionate about their food product to the extent that they became transfixed by the importance of the beauty of the piece of cheese they were making and as a result were unable to get it to the store on time. I am happy to say that since then, 99.99% of Irish artisan producers have become über-efficient and über-professional in the manner in which they do business. We are delighted to be able to support them.

To answer Deputy Pringle's question, as far as I am concerned Ms Buckley can give him all of the information he likes on the Competition Authority. An enormous amount of research has been done in the UK, France, Sweden and other European countries. The big four in the UK have been investigated more than once by the Office of Fair Trading. I do not think there are any issues and as far as I am concerned it is quite clear and one can read between the lines.

With regard to the effect of the beef issue, we are a traditional supermarket and butcher and we do not sell pre-packed products as such. The recent meat debacle has had a wonderful and excellent impact on me personally. The overriding issue is still the same and it has been mentioned by a number of people, namely, that cheap food means cheap quality. It is very simple. With regard to the 18% price difference between the UK and the Republic of Ireland, I am available for a week if committee members wish to speak about this and they are welcome to come to my store.