The Food Industry HypermarketsPresentation Transcript
The Food Industry Don’t Believe the Hypermarket!
Are the monster mega stores really going green?
If you believe the hype, supermarkets the world over are going all green and cuddly. The British giant Tesco has announced that it is bolting renewable electricity generation on to its stores and rewarding customers for re-using plastic bags. French supermarket transnational Carrefour is advertising its reduction of toxic chemicals in cleaning products. The Real Canadian Superstore chain is giving a high profile to its range of ‘environmentally friendly’ household goods.
‘ It is clearly good for our business,’ says Scott. ‘We are taking costs out and finding we are doing things we just do not need to do, whether it be in packaging, or energy usage... there are a number of decisions we can make that are great for sustainability and great for bottom-line profit.
A small number of supermarkets control what much of the world eats. In Australia two companies, Woolworths and Coles, sell a third of all food consumed. In Britain the ‘big four’ sell 75 per cent of the country’s groceries, with Tesco alone controlling 30 per cent of the market. In the US Wal-Mart, the largest retailer in the world, controls 20 per cent of a $450 billion market.
These trends are rapidly embedding themselves in LEDCs too, with a third of Mexico’s food expenditure going to Wal-Mart alone. This power means that supermarkets are effectively deciding what we eat and how much suppliers will get paid for it.
Buying Organic helps?
What you are buying when you choose an organic product from a supermarket is probably not the crop of a local farmer .
Many organic brands marketed as if they are small, independent, benevolent firms are actually owned by transnationals. They include Seeds of Change, bought by Mars in 1997, Green & Black’s, snapped up by Cadbury Schweppes in 2005 and Back to Nature, held since 2003 by Kraft.
Watering down standards
The concentration of leading organic brands in the hands of transnationals is steadily turning organics from a progressive movement into a label supermarkets can charge higher prices for. Sadly the hiked prices do not necessarily feed back into more ecological practices or better conditions for workers. Quite the opposite. According to Mike Green of the UK Soil Association: ‘Small and medium producers are being squeezed out because it becomes financially unviable for them to sell to supermarkets that are pushing down prices and cutting margins.’
In another attack on organic standards, in 2005 the EU announced plans, currently being fiercely opposed, to allow food labelled ‘organic’ to contain up to 0.9 per cent contamination with genetically modified materials. In Britain, Marshall’s, one of the largest suppliers of vegetables to supermarkets, is rapidly moving into large-scale organic provision as demand grows. The company has been fined over £30,000 for pollution incidents between 2004 and 2005
Aggressive pricing which drives small local businesses into bankruptcy, encouragement of car culture, the environmental implications of building large superstores on out-of-town sites, squeezing small supplier firms, using wasteful packaging, and poor treatment of workers on the shop floor and in Majority World sweatshops are just some of the criticisms levelled against the big players.
Walmart – The facts
In 2001, sales associates, the most common job in Wal-Mart, earned on average $8.23 an hour for annual wages of $13,861. The 2001 poverty line for a family of three was $14,630.
In December 2005, a California court ordered Wal-Mart to pay $172 million in damages for failing to provide meal breaks to nearly 116,000 hourly workers as required under state law.
The average full-time employee electing for family health coverage would have to spend between 22 and 40 percent of his or her income just to cover the premiums and medical deductibles. These costs do not include other health-related expenses such as medical co-pays, prescription coverage, emergency room deductibles, and ambulance deductibles.