To get a proper grip on the workings of the food industry, it is vital to understand the units that are used to organise and quantify production. Since this website sets out to cover historical aspects of food production, it is only fair to offer a brief outline of the systems in place during the formative years. We live in a metric world and should not imagine that any other set of measures is going to return to re-establish the status quo ante. But we need to have a clear idea of how we started.
The starting point for present purposes is the 1824 Weights and Measures Act, for reasons which will be made clear to subscribers in a fuller treatment of the topic. It will come with a basic tool kit for managing the practical aspects of modern metrology. For seekers of the arcane, visit Wikipedia’s excellent listing of the many post Sumerian systems and notations for weights, here. (https://en.wikipedia.org/wiki/Ancient_Mesopotamian_units_of_measurement)
It might seem odd to a modern observer that 1925 the UK’s ministry of labour classed the following foods as seasonal: fish, milk, butter eggs and potatoes. The fact that prices and availability might change quite widely across the seasons is the argument advanced for ignoring such basic foods when calculating a retail price index, putting the cart before the horse.
Ask any economist and they will tell you that economics is a science, founded on mathematics and using none but the most reputable methodologies known to data science. The acid test of any scientific discipline is to be able to replicate previous experiments and repeat the results to within an acceptable margin.
To be sure, if you take the same data and crunch the numbers using the same calculations, you will get the same results as the previous economist. But economists are a diverse bunch, not to mention the smørgesbord of economic policy recommendations to be shared as the opportunity arises.
If this sounds less than serious in its tone or intent, it may be that it is not written by A Proper Economist (always spelt out in full, never abbreviated). A Proper Economist can be relied upon to analyse market data and forecast the likely price trends within a given sector. If, on the other hand, you wanted to know the retail price of a grocery line for the coming year, that would be a closely-guarded secret between a supermarket buyer and her (or his) supplier.
With the digitisation of the retail checkouts in the early 1990s came a tidal wave of sales data that probably paid for itself in months, if not weeks. For the first time in recorded history the multiples knew exactly how many units of which lines they were selling; where they had multiple suppliers of own-label products, the multiples could start to make direct comparisons between suppliers and the margins they were generating. Individual suppliers knew what volumes each was shipping to retail customers, but only the category managers had the whole picture.
The supermarket buyers’ secret weapon of choice in those days was a miniature tape recorder and microcassettes, to which verbal contracts worth millions of pounds were recorded. If any hard copies were ever made, these would have been kept in a safe. Supermarket buyers and category managers are overlapping roles. They were always instantly recognisable at trade fairs, leaving suppliers’ stands with their tape recorder pressed to their ear, playing back the small print as it was wrung out of the supplier. There was no question of suppliers passing on price increases arising from higher prices on the international markets: the standard response in those days was: “find cost savings in your business…”
Not that buyers ever applied that principle to their own dealings with suppliers. Food manufacturers presenting new ranges and products to multiple retailers would face requests for a listing fee and, often as not, a request for special offer stock. Listing fees were also referred to as hello money or shelf money, among other names. They used to start around £5000 per SKU for listings in an agreed number of outlets. Shelf money was never refunded if a product was delisted, but would be requested for years to come during the life of the listing.
Special offers were not what they might have appeared to be, either. The retailer charges the consumer for the special offer part of the price. But does the multiple give away the offer component of the price? Hell no! They recovered that from the suppliers, who systematically funded the offers, providing free stock directly or having the equivalent money withheld from invoices for other products. Either way, the retailer banked the full price on special offers. From the retailer’s point of view, it is having your cake and eating it. Even though the Grocery Code Adjudicator’s office has cleaned up the retailers’ act, the industry is still haunted by the ghosts of past sales targets.
