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BY MICHAEL BARKER

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Sainsbury's outlines supplier support

Supermarket joins Morrisons in pledging to pay small suppliers immediately and offering support to suppliers in distress

Sainsbury's outlines supplier support

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Sainsbury’s has pledged to support its suppliers and partners with their cash flow as they look to navigate the coronavirus pandemic. 

The move, which is designed to help businesses increase production volumes quickly to meet customer demand, sees Sainsbury's commit to pay small suppliers immediately, benefiting 1,500 small businesses with under £100,000 of business with the supermarket. 

Sainsbury's is also making support available to suppliers who find themselves in distress as result of the ongoing uncertainty, and is extending its support to tenants and concession partners. As a first step, the retailer is offering all tenants the opportunity to pay rent on a monthly basis as opposed to quarterly in advance. It is anticipated that 250 tenants and concession partners will benefit from the new arrangements.

Paul Mills-Hicks, commercial director at Sainsbury’s, said: “We want to support our suppliers and partners because it is vital that we all help each other during this challenging time. The businesses we work with are working flat out to supply us with product and going above and beyond to deliver direct to our stores. I am so proud to be working alongside them to feed the nation and we will do all we can to help.”

Support from Morrisons

The move follows similar measures announced by Morrisons on 13 March. Like Sainsbury’s it has switched to immediate payments for its smaller suppliers to help them during the ongoing coronavirus pandemic.

The retailer is temporarily reclassifying a smaller supplier from those with £100,000 of business-a-year with the company to those with £1 million of business. This will mean an extra 1,000 small food businesses will qualify for the new payment terms. 

The move will help businesses that provide up to £1m of turnover with Morrisons, including suppliers of local food and farmers that deal direct with Morrisons. In total, Morrisons has around 3,000 small suppliers including 1,750 farmers that will benefit. 

It is expected that Morrisons’ temporary payment terms will last until the end of May before being reviewed. 

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