Tesco Ireland: Quality Supplier programme

Company Description:
Tesco Ireland is a subsidiary of Tesco plc which operates supermarkets in 11 countries. It operates 79 supermarkets across the Republic of Ireland, employing over 11,000 people. The stores offer a wide range of Irish and international brands and own-brand goods, and Tesco is the market leader serving over one million customers a week.

Business Issue:
One of Tesco’s key business strategies on entering the Irish market in 1997 was to build close relationships with the Irish supplier-base to produce Irish-made Tesco own brand products and branded goods for stores in Ireland and for export to the UK and to the wider Tesco Group.

Solution Applied:
Tesco Ireland put a 12-strong team of technical and trade development experts in place to work with supplier companies building their product development skills and market expertise, to help them prosper in a rapidly changing commercial environment. Only 20 companies were approved suppliers in 1997, before the programme started. As a result of this programme, and other commitments to buying from Irish suppliers, Tesco now buys over €1.444 billion worth of goods from some 800 Irish companies, over 80% of which are small to medium sized enterprises. Supplier companies have created 1,025 new jobs as a result of increased business from Tesco.

Company Benefits:
Tesco’s success has been built through listening to customers, responding to their demands, and Irish customers have told us that they like supporting Irish suppliers by buying quality Irish produce, food and drink from our supermarkets. It makes sound commercial sense for us to invest in our relationships with Irish suppliers, and to use our expertise and retail experience to help build their businesses, and to support the local economies in which we operate. Tesco’s business in Ireland, and its level of customer support, has increased steadily over the time that the Quality Supplier Programme has been in place.

Stakeholder Benefits:
All stakeholders benefit from the Quality Supplier Programme by being included in the business and market planning cycles of one of their largest customers –Tesco Ireland. By pooling expertise, ideas and experience in a long-term, customer-focussed relationship, their businesses benefit long term. Achieving accreditation with a major international retailer such as Tesco helps enhance a supplier’s production and business processes to world-class standards, to benefit their total business. Producing own brand goods for a retailer means that companies do not have to face the additional expense and administrative burden of marketing, brand development or distribution to stores. In addition, the Tesco Ireland Technical Team has lent their support and shared their expertise and knowledge of modern consumer needs and tastes to assist Enterprise Ireland in building their Supplier Development Programme since 1998.

We engage in a constant customer communication campaign, highlighting the extent of Irish goods in our range, by means of: Advertising; Packaging, Shelf-Edge Labels, Leaflets, Posters and Staff training. Communications with the participating supplier companies and State Agencies are on-going, and are now embedded in the ‘day-job’ of Tesco Ireland.

Solution Champion:
Dermot Breen, Director of Corporate Affairs, dermot.breen@tesco.ie