Supermarkets and brand owners to pass on costs of horsemeat scandal

Having developed the model of multiple levels of outsourcing in the relentless drive for cheaper and cheaper food, the supermarkets and brand owners are now seeking compensation from contract manufacturers for losses incurred by the removal of product from supermarket shelves due to the horsemeat scandal. Tens of millions of Euros are at stake as supermarkets seek compensation from brand owners and many brand owners have already publicly indicated they plan to seek compensation from outsourced suppliers. Many of these suppliers will face bankruptcy and workers will also pay with the loss of their jobs.