The global headlines said it all: for several months during the first half of 2013, the whole of Europe was rocked with the news that unapproved horsemeat had found its way into the food chain and onto the shelves of the supermarkets. The media coverage was enormous. By July 2013, typing ‘horsemeat scandal’ into Google produced over 228,000 hits, from news organizations, government agencies, scientific authorities, food industry bodies, and not forgetting the almost obligatory Wikipedia entry.

The scandal broke in Ireland on 14 January 2013, when the Food Safety Authority of Ireland announced the results of analyses of frozen beef burger samples it had tested in November 2012. The results indicated that equine DNA was present in the samples from several major food supermarkets: Tesco, Iceland, Aldi, Dunnes Stores and Lidl.

The Tesco beef burgers, supplied by ABP Silvercrest in County Monaghan, revealed as much as 29 per cent horsemeat. Two other factories were cited as providing meat with lower levels of horse DNA: Dalepak in Yorkshire, UK, also owned by ABP, and Liffey Meats in County Cavan, Ireland. It’s argued that the scandal knocked almost

£300 million off Tesco’s market value within 48 hours of the news breaking. This was a scandal that was going to run and run. In January 2019, two former managers of French meat-processing firm Spanghero and two Dutch meat traders were put on trial in Paris, accused of using cheap horsemeat in beef products that were sold across Europe. The four accused could face large fines and lengthy jail sentences if found guilty.

Of course, horses are slaughtered for their meat in parts of Europe and horsemeat is readily available for sale in European markets. The issue wasn’t horsemeat per se.

There was much confusion at first and debates raged about whether it was a food safety issue or a breach of consumer trust, or both. Products were recalled, food was taken off the shelves of the supermarkets, and food standards and safety authorities set about trying to establish what had happened.

Ultimately, at issue on this occasion was the fact that the meat in the affected burgers and other products was actually intended to be beef and should not have contained traces of any other animal product. Indeed, analyses of some samples of beef indicated that pig DNA was also identifiable. The concerns became more about consumer trust than food safety. The lack of traceability, for example, meant that people seeking to avoid particular foodstuffs (for example, for religious observance reasons) found it very difficult to know what beef products they could trust.

By the time the full extent of the saga had been played out, 15 European countries had become involved. The European Union, including European agriculture ministers and the European Commissioner for Health and Consumer Policy, was involved in formulating responses at the highest levels. This included a very large programme of DNA testing of 2,250 processed beef samples across the European Union and further plans to bolster food safety legislation within the EU, including more money for food surveillance as well as stronger financial penalties for food operators that commit fraud or fail to comply with food safety laws.

Along the way, a whole collection of household names in food have been affected. Horsemeat traces found their way into consumer food products either manufactured directly by, or sourced by the subcontractors of, Findus, Nestlé and Birds Eye. Own-brand beef products sold by major supermarkets were also affected. In addition to those announced at the time of the initial Irish investigation (Tesco, Aldi, Lidl, Iceland and Dunnes Stores in the UK and Ireland), Asda and the Co-operative Group in the UK, as well as Real in Germany and Ikea across Europe, also withdrew ranges of beef products in the wake of the scandal. Intermediaries such as foodservice companies and catering suppliers were not immune either. Brake Bros, a food service company which supplies the Whitbread Group of companies (which includes Premier Inn hotels, Brewers Fayre pubs, Table Table pubs and Beefeater Grill restaurants), found traces of horsemeat in its beef lasagne and burgers. Catering companies Compass and Sodexo, which supply institutional markets such as schools, hospitals and prisons, also found horsemeat present.

There has been subsequent criticism of the extent to which the meat supply trade within Europe has become too complex. One example, relating to how horsemeat found its way into products such as Findus beef lasagne, shows how extended and complex the supply chain can be:

• Comigel, a French company supplying Findus, among others, asks its subsidiary, Tavola in Luxembourg, to manufacture beef products (including Findus beef lasagne).

• Tavola orders the beef from a meat processor, Spanghero, in the south of France, which sub-contracts the supply to a company in Cyprus.

• The Cypriot subcontractor uses Draap Trading Ltd in Belgium to make the order of the meat itself.

• Draap uses two slaughterhouses in Romania (Doly-Com and CarmOlimp) for the supply of the meat, and the meat is sent to Spanghero in France from where it is then sent to Tavola, which makes the products for supply to Findus and retailers across Europe.

Some attribute this longer and more complex chain to the way pricing operates within the meat production industry overall, arguing that prices are squeezed more tightly over time by the powerful supermarkets, which means that animals.

QUESTIONS In addition to reading the case material, spend some time on the web trying to get a picture of the complexity of the meat supply network in Europe at the time of this scandal:
1. Using ARA concepts, compare the examples of the networks of companies that were negatively affected by the scandal and those that were less affected.
2. Establish Comigel’s relative network position in light of the scandal and indicate how it may be able to improve it.
3. As a senior executive at Tesco, who has recently read all about business-tobusiness interaction and networks, what strategic objectives would you set to redress the difficult network position the company now finds itself in?
4. Using the ARA model and relationship management concepts, establish five key relationship management tasks that you feel will help achieve the strategic positioning objectives.