On June 6, AUSVEG, the national peak industry body representing Australian vegetable growers, accused supermarket giant Woolworths of forcing Aussie growers to pay hundreds of thousands of dollars to fund its new Jamie Oliver campaign.
In a promotional video released last month, celebrity chef Jamie Oliver claimed that his partnership with the supermarket "involved looking at standards and ethics of where our food comes from", including food safety and offering support for our local farmers. However, Woolworth's treatment of farmers - forcing individual growers to pay a new 40 cent per crate charge on top of the five percent fee they already pay to Woolworths to market and promote their produce - might be missing that mark, taking advantage of the farmers' vulnerable financial positions.
“AUSVEG is alarmed at the way that Woolworths is squeezing its suppliers for more cash and are outraged at the way that the company is behaving,” said AUSVEG Acting CEO, William Churchill.
"Financially stretched Australian vegetable growers are being unfairly pressured into contributing to a marketing campaign for a company which in February posted a $1.32 billion net profit."
Small producers operating on squeezed profit margins are facing extra pressure, while one large supplier expects to pay $300,000 over the six-week Woolworths campaign, AUSVEG said.
According to AUSVEG, growers around Australia are worried that if they do not obey Woolworth's requests to fund the campaign, their business will be blacklisted, blocking them from Australia's biggest consumer market. Customers will miss out on the chance to support local Australian farmers who value food safety and quality.
AUSVEG have teamed up with South Australian senator Nick Xenophon to issue a formal complaint with the ACCC, urging them to investigate Woolworth's behaviour.
In retaliation, Woolworths declared that around half of its suppliers "chose to work with (them) on the campaign, which benefits the whole fruit and vegetable industry" and "participating growers are paying less than 2 per cent of the cost of a case of produce." However, the supermarket neglected to confirm what percentage of the farmers' contributions would go to covering the campaign's advertising costs. They also refused to provide information on the expected return on investment for farmers.
Writing to celebrity chef and star of the campaign Jamie Oliver, AUSVEG asked Oliver to pressure Woolworths to remove the fee and refund the growers' contributions.
Today, Woolworths cancelled a meeting between Australian farmers and 40 international buyers. Jamie Oliver's publicity manager also replied to AUSVEG's letter, stating that Oliver was aware of the issue.