Risk management was high on the agenda at Aon's recent conference of European food retailers.
Among the potentially hazardous topics discussed were:
• Increasing liability and brand damage risk associated with the sale of non-food goods
• Political risk associated with moving into or working with suppliers from foreign countries.
•Campaigning groups, which are targeting retailers as an easy way to secure publicity.
• Increasing pressure on retailers to stock healthy foods as obesity levels rise.
• Rising levels of counterfeiting, which are proving a threat to both brand owners and consumers.
• Government uneasiness about consolidation.
• Rising energy and raw material costs.
• Supply chain costs
• An ageing population in the Western world has unpredictable consequences for the pattern of consumption in those countries.
• Waste disposal — 15 to 20 per cent of household waste consists of food and packaging.
Among the solutions for retailers are:
• Improved risk governance procedures
• Reviews of supply chain and working practices
• Corporate Social Responsibility programmes.
Kevin Mahony, of Aon's Risk Management Solutions, said: “Globalisation is having a massive impact on food retailers and while it opens up new possibilities it also exposes them to new threats. The smart firms are embedding risk management within their organisation so that it becomes a natural part of the business process. In an ever changing world companies need to keep on top of their risk management otherwise they will fall behind their competitors.”
