Sainsbury’s pulls the plug on wholesale operation

Sainsbury’s has unilaterally decided to close down its wholesale business and therefore stop supplying the SimplyFresh group with Sainsbury-labelled products.

SimplyFresh announced this morning that as a result of Sainsbury’s decision it no longer has an ongoing agreement with the supermarket as a supplier.

Sainsbury’s said that if SimplyFresh wished it could continue to receive a supply for the next 12 months.

A Sainsbury’s spokesman said: “As part of our plan to put food back at the heart of Sainsbury’s, we are simplifying our business so we can focus on what matters most to our customers – lower prices, exciting new products and convenient ways to shop.

“To deliver our plan we must prioritise what we do. We have just started talking to our retail partners and colleagues about what this means for the future of wholesale and it will be a gradual process.

“We know these conversations may cause uncertainty for our partners and colleagues and we are committing to supporting them.”

The arrangement was highly valued by many SimplyFresh retailers, including Steve Bassett, who converted his Bitterne Park store in Hampshire to SimplyFresh this year.

In an interview with Independent Retail News last month he said:  “I’ve always admired the style of the stores but used to think that if you wanted what they supplied you could just go straight to Nisa, so I hadn’t gone for it until now.”

He added that what made the difference was when Simply Fresh linked up with Sainsbury’s.

Being able to stock fresh food with the Sainsbury brand on it makes all the difference, said Bassett, with customers regarding it as a higher quality product than most own-brand labels.

SimplyFresh said that its retailers supplied by the Costcutter group will remain unaffected by the change.