Business Editor Paul Grinnell finds out what is involved.

IT IS a rare opportunity and one many budding food producers might have thought would never come their way.

The chance to supply foodstuffs to the mighty Tesco was beyond the most realistic dreams of small scale producers.

This was a giant company that dealt in massive volumes of thousands of tonnes of food stuffs per day being moved by the pantechnican-full to a chain of hundreds of stores the width and breadth of the UK.

But then came the change.Concern over the future well-being of the environment, anxiety over carbon footprints and the damage caused to the environment by the transport of food across the planet, has led customers to demand more locally grown food on sale in the supermarkets nearest to their homes.

And Tesco, which has grown to become the UK's number one supermarket with profits reaching £2 billion has not achieved its success without being alert and responsive to the demands of its customers, has moved quickly to accommodate this change in tastes.

Now Tesco is putting its full weight behind a new drive to actively seek out small scale producers to provide a range of foods and drinks to its stores.

It has set up five regional offices across the UK – including one at Peterborough which is headed up by senior buyer Sam Nundy, the son of a Lincolnshire farmer, supported by a number of other hand-picked specialists who can provide the advice and help which is vital to any supplier that is going to successfully deal with the retailer.

Based in offices at the Tesco Extra store at Serpentine Green, Hamptons, Mr Nundy said: "We have changed our approach and it has been driven by our customers.

"Our customers have told us they want more local products.

"They also want to see more details provided about the product and about where it is grown and by whom. For instance on some of our egg boxes we have the pictures of the growers.

"Then there is the growing concern over the well-being of the environment and the food miles – the distance food has to travel from its point of production to the store and the impact that journey has on the environment."

And Peterborough has been chosen as one of five locations in England to drive Tesco's 'buy local' campaign.

The retailer has set up five regional offices equipped with expert buyers, marketers and technical experts to find new sources of local produce but also to ensure conditions of production meet Tesco's high standards and provide help and advice with promotion and distribution.

The Peterborough office was set up a year ago and Mr Nundy,

whose parents are farmers in Lincolnshire, says it has already tackled many of the challenges the new offices in Leicester, Horsham, Plymouth and York.

Mr Nundy said: "We were very much a trailblazer for this inititiative which has been taken because our customers are telling us they want to see in our stores the produce they see growing in the fields around the area in which they live. In fact we have always sourced a lot of food locally but we have never shouted about the fact. For instance many of our own-label brands are actually locally sourced "

Mr Nundy said: "Peterborough was chosen because the city is home to one of our largest stores, it is in the middle of the eastern region and is also close to our distribution centre.

"There are three key things that we do. We go out and source new products, work with current suppliers in the region and work with own label suppliers and highlight their local products.

"We have been working closely with Taste of Anglia and have held a couple of meet-the-buyer events and have attended local food shows.

"We also have a regional website which allows producers to contact us and we will then go out to them."

"I am also able to use my local knowledge. We use customers' recommendations and we are always talking to current suppliers because they do a lot more than we know about."

At the moment, the main products that are locally sourced are potatoes, brassica, pork, poultry, salad crops and real ale.

But new products are coming on to the market all the time and Mr Nundy said that in the next 12 weeks customers could expect to find new products from Peterborough-based Oakham Ales and a new flour product from Glebe Farm, near Huntingdon, in three weeks.

Many of the potatoes sold in Tesco come from Floodferry, which packages many of the potato crops grown in the greater Peterborough area and this weekend also saw the introduction of a new range of eggs from Cambridgeshire.

But the local produce is not just confined to food. Currently in store are Lincolnshire grown tulips, grown by James Cole, in West Pinchbeck, who has worked with Tesco for the last 10 years.

Mr Nundy said while it could be daunting for a small supplier to work with Tesco, the new initiative was also a learning experience for the huge retailer.

The Tesco team in Peterborough has experts who will provide advice on making sure products are safe and legal. Visits to Tesco will be arranged to ensure the supplier understands the business and knows what is involved in doing business with the supermarket and how arrangements for payments, supply and distribution and even barcodes are organised.

Mr Nundy said: "We will work with suppliers to help them reach the levels we require. But this has also been a learning curve for us. Everything we do has been on a large scale. But we have found that flexibility is the key and we have the potential to be able to take one product and place in just one store.

"We have started with a supplier putting products into just a few stores and that has grown and the company has become bigger and started to supply even more stores.

For the future, Mr Nundy said the aim was to increase the amount of locally-grown products in its stores over the next 12 months. Over the last 12 months Tesco has sourced about £20 million worth of east of England produce and the intention is to increase that figure dramatically.

He said: "This is more than a trend – it is something that is here to stay."

Chief executive of Taste of Anglia Julie West said: "It has not been easy and Tesco has made changes to its systems to accommodate the small producers and at the moment it is a very good deal for these local firms."

FACTfile: Tesco

Tesco employs 450,000 people worldwide.

In 2001 sales stood at £22.6 million but had risen to £46.6 million last year.

Profits in 2002 were £1.3 million and £2.5 million last year.

Tesco has 1,988 stores in the UK with a total selling space of £27.8 million square feet

There are 7865.9 million Tesco shares in circulation.

In 2006, the share dividend paid out was 8.63p per share. That rose to 9.64p last year.

Profile: Sam Nundy
AGE: 31
LIVES: Spalding
CAREER: Placement at Sainsbury's head office.
Tesco as graduate in commercial section.
Senior buyer for the east of England.

Oakham Ales to supply bottled beer to superstore
Oakham Ales, of Peterborough, is to start supplying three types of bottled beers to Tesco in April.

They will be JHB, Bishop's Farewell and Hawse Buckler.

Partner and head brewer John Bryan said: "It has been a fairly easy relationship and is more of a marketing exercise for us – it will give our brand greater recognition but I think there will be little to be made from the prices that are to be charged.

Tulip supplier's turnover has increased 300 per cent

Flower grower James Cole cheerfully agrees that he is a champion of Tesco.

For the last 18 years, his business EM Coles (Farms), of West Pinchbeck, Spalding, has supplied tulips to the retailer.

He said: "It is a challenging relationship at the best of times.

"But deciding to do business with Tesco was the best move we ever made.

"It is the UK's number one supermarket and what better place could there be for our flowers?"

He said the link with Tesco had brought stability, ensured regular payments, high quality and investment.

Mr Cole said: "It has enabled us to invest in the business. Eighteen years ago we employed 10 people and now we have 30. Our turnover has increased by 300 per cent.

"Over the same period the number of stems we provided has risen from 800,000 a year to six million and we also buy in up to five million.

"When we first started with Tesco they were the UK's second biggest retailer. Now they are number one and our business has grown with them."