Jamie burnt by Woolies deal

18 Jun, 2014 07:15 AM
Comments
18
 
Considered this way, it stinks more than a truckload of rotten spuds

OPINION: CHEF Jamie Oliver is used to a hot kitchen but his deal with Woolworths has exposed him to a very different form of heat.

October last year, Woolworths announced a “partnership” with the celebrity chef. Ostensibly, this is about “inspiring a healthier Australia”.

Mr Oliver promised in a YouTube video he would be “working across the whole of the business, at front and back end.” In another video he said: “Part of what I’m doing with Woolies is looking at standards, and ethics, of where our sort of food comes from.”

The problem is that he is not. Instead, Mr Oliver has come under fire over the funding of the advertising surrounding his relationship with Woolworths.

“Part of what I’m doing with Woolies is looking at standards, and ethics ...”

Woolworths are demanding that growers pay the costs of their advertising campaign, asking for a levy of 40 cents for every crate of fruit and vegetables sold. That doesn’t sound much, until you think that farmers’ profits average only $1 per crate for a whole season’s work.

Considered this way, it stinks more than a truckload of rotten spuds.

Of course Woolworths say that the levy is voluntary but Woolworths tightly control their supply chain and growers know that if they don’t pay Woolworths may very well not buy the crop they have in the ground.

Both Woolworths and Mr Oliver’s people have so far refused to disclose the amount he is being paid for this advertising extravaganza. But it's a lot, an awful lot.

All of this begs the question as to whether there is any substance at all to what Mr Oliver claims to be doing. Other than giving away a few recipes, it would appear not.

Let’s look at his claims about standards and ethics.

There is an internationally accepted framework for analysing a company’s social footprint. It is called the Global Reporting Initiative. It sets out objective measures of a company’s sustainability.

One of these measures is the amount of product packaging a company uses. If Mr Oliver really was looking at the standards and ethics of the food supplied, he’d know that Woolworths meat, for example, is highly packaged, using polystyrene. Not only is polystyrene environmentally disastrous, there are serious questions about its health risks.

Another key measure is the degree to which the company has been engaged in anti-competitive practices. The Australian Consumer and Competition Commission (ACCC) confirmed this week that Woolworths are the subject of a long-running investigation into the way they treat suppliers.

If the ACCC’s recently commenced action against Coles is any guide, this will include demanding payments from suppliers when there is no legitimate basis for seeking those payments. And that brings us back to Mr Oliver and the levy on our Aussie farmers.

When pressed by the vegetable growers’ peak industry body, Ausveg, over the demands they surrender 40 per cent of their profits to Mr Oliver and Woolworths, he at first dithered. Then, on Friday, a letter was issued by his representatives to say “Jamie is essentially an ‘employee” of Woolworths and as such he has no sway regarding the commercial direction... the Woolworths business takes.”

That’s not what he boasted in his video.

Moreover, in this case he is not a spectator but effectively a beneficiary of these demands on our farmers. If he doesn’t approve of Woolworths’ ethics, he can withdraw from the campaign, and refund his endorsement fee. I suspect he won’t.

In the last 12 months, the average vegetable grower has gone from making a small profit to making a loss. In the same 12 months, Mr Oliver’s wealth rose by an estimated £90 million. Now we know how.

Bill O'Chee is a consultant and former Nationals senator.

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READER COMMENTS

Archibald
18/06/2014 7:46:55 AM

Third party contracts always impact the grower, and the grower has zero say. The Federal Government also does what Jamie and Coles do. In the cattle industry two examples are NLIS and LPA
farmed
18/06/2014 8:26:24 AM

farmer- "hello accc. i'm a farmer getting ripped off by woolworths. can you help me?" accc- " no, sorry. you volunteered to give the money away" farmer-"but they threatened to take away my contract" accc-"do you have any proof?" farmer-"no. it was a verbal threat" accc-"we're sorry, we cant do anything. is there anything else we can help you with today/" farmer-"no" accc-"good by" this will be the standard dialogue if any farmer complains.
x
18/06/2014 8:30:26 AM

Shame on Jamie and Woolworths !!
Call to action
18/06/2014 8:42:26 AM

Go to http://www.jamieoliver.com/contac t and tell Jamie it is not on.
Bushie Bill
18/06/2014 9:20:39 AM

This is a beat up storm in a teacup, and has nothing to do with Jamie Oliver. Farmers who look for excuses for their failures should give us a break.
Bruce Watson
18/06/2014 10:10:54 AM

Hardly a beat up, Bushie. Surely Woolworths' advertising - to sell the products in their stores vis-a-vis Coles, etc., is part of their own business plan? Squeezing the growers - who have already been paid a paltry sum against the retail mark-ups is draconian. Perhaps you will explain your vision more clearly?
argis
18/06/2014 11:04:46 AM

I will explain Bushie's vision for you Bruce. He has made it very plain over a period of time. It is to get as much revenge on farmers as possible for some rip off he tried out years ago against a farmer and got caught out. Now his vision is to spend as much of other peoples money as he can. He wants us to import wheat from India for example and subsidized food products from overseas, mainly produced by workers getting much less than ours, thereby putting our workers out of their jobs and sending our businesses bankrupt.
Inverell
18/06/2014 12:56:37 PM

Archibald the Govt most certainly imposes extra costs on growers without their permission ie NLIS, LPA and from what we ALL know now for no benefit for the producer at all. You cannot expect the Govt to do anything, they are worse than Colesworth. If you don't sign up for LPA you CANNOT sell stock and your business will close. Same goes for NLIS both are adding to our costs for no benefit except to make extra jobs at our expense.
angry australian
18/06/2014 12:59:17 PM

Way to go Woollies, got to be the worst own goal since the first game of the World Cup. Not a good story for those who claim to be the fresh food people. What this story does bring into focus is the pitiful prices the consumer is paying for home grown product
Bullman
18/06/2014 4:54:49 PM

No one has commented on woollies filling there shelves with china,s rubbish.
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