Co-op suppliers ‘not impacted’ by 285 job cuts

By Matt Atherton contact

- Last updated on GMT

Co-op plans to close distribution centres in Ipswich and Lincoln
Co-op plans to close distribution centres in Ipswich and Lincoln

Related tags: Supply chain management, Commercial item transport and distribution

The Co-op will still work with local suppliers despite closing three distribution centres across the UK and putting 285 jobs at risk, the retailer said this week (July 10).

Lincolnshire Co-op and East of England Co-op both confirmed the closures wouldn’t impact its suppliers, and they would continue to supply locally-sourced products to its stores. Their comments came after the Co-op society revealed plans to close two distribution hubs in Lincoln, and one in Ipswich, so their respective Co-op businesses could join its national integrated supply chain.

East of England Co-op joint chief executive Roger Grosvenor said: “Most of our locally-sourced products travel directly from our suppliers to stores, which means our members and customers can enjoy fresh local produce whilst reducing food miles.

“We are in the early stages of exploring a local food ‘hub’ which would provide distribution support to Sourced Locally ​[scheme] suppliers, as well as offering them a route into other markets.”

A Lincolnshire Co-op statement read: “The ​[Co-op] society would still work with local suppliers and wholesalers to supply locally-sourced goods to its outlets.”

Planned closures

Closing the Ipswich distribution centre puts 174 jobs at risk. East of England Co-op planned to close the facility by 2020.

Joining the society’s supply chain initiative would allow the retailer to maintain levels of product availability, and offer competitive delivery costs to stores, it said.

Grosvenor said: “Fully integrating our business into the national integrated supply chain means our customers and members can benefit from greater economies of scale.

“Part of this agreement involves a decision, in principle, to close our distribution centre at Boss Hall Business Park, Ipswich, in early 2020. This is subject to consultation with colleagues and the Union of Shop, Distributive and Allied Workers​ [Usdaw] trade union.”

The site distributed ambient products to 125 food stores across Norfolk, Suffolk and Essex.

111 Lincolnshire Co-op distribution and office staff were at risk of redundancy, after plans to close its Lincoln facilities. The planned closures would give customers more choice of products, and would save the Co-op about £1M a year, said Lincolnshire Co-op.

‘The right decision for the society’

The business’s chief retail officer Mark Finn said: “The difficult decision to close our food distribution centres is not one we have embarked on lightly. However, we’re confident that this is the right decision for the society because it will lead to significant savings, which we can invest elsewhere.

“As demand for the fresh and frozen goods increases, it’s more efficient for us to combine the two separate delivery streams.”

The move to an integrated supply chain was planned from September 11.

The Usdaw union said it would try to save jobs, or to get staff redeployed to other Co-op businesses.

Usdaw area organiser Ed Leach said: “Staff at the distribution centres are shocked by the company’s announcement and are we meeting with management to hear the rationale for their proposals and engage in meaningful consultation about the proposed closures.

“We will be looking at options to save jobs and keep staff in employment within the Co-op or with other employers.”

Co-op distribution planned job cuts – at a glance

  • Suppliers “not impacted”
  • 174 jobs in Ipswich
  • 111 in Lincoln

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