The price war between UK supermarkets has seen buyers using suppliers as "cannon fodder", according to new research by accountancy firm Moore Stephens.
The firm said the fight for discounted checkout prices is "causing pain throughout the supply chain", with some 146 producers going bust this year, a 28 per cent jump on last year.
The rise in ?food producer ?insolvencies can be compared to the ?eight per cent? fall in company liquidations in the UK economy as a whole over ?the same period.
?Duncan Swift, a partner at Moore Stephens, said that "supermarkets are going through the bloodiest price war in nearly two decades and are using food producers as the cannon fodder.
"Supermarkets have engaged in questionable buying practices for years, but it’s getting worse and clearly wreaking havoc on the UK food production sector.
"The fact that food producer insolvencies are rising so rapidly, while business insolvencies are falling overall, shows just how much pressure the sector is under.?"
In repsonse, the British Retail Consortium said it believes that it is “far too simplistic” to blame retailers for the situation and “there may be a number of reasons for failure”.
© 2014 European Supermarket Magazine – your source for the latest retail news. Article written by Andrew Jennings
