Orchard House Foods to close Gateshead factory with 430 jobs at risk

The business — which provides freshly prepared fruit, fruit drinks, fruit jellies, fresh fruit yogurts, compotes and granolas to major retailers, supermarkets and restaurants in the UK — plans to open a previously-closed production line and consolidate production at its existing site in Corby by the end of November this year. 

Orchard House Foods revealed that it has made significant investments in its Gateshead site to turn around its performance, but said the site is continuing to make losses that make it commercially unviable. Production has suffered from the rapidly rising costs of food, labour, energy and transport and an inability to recruit enough staff, it said.  

Consultation

It has started a consultation process with the 430 members of staff facing redundancy. The company said it expects that a significant number of new jobs will be created in the East Midlands as part of the proposed relocation. Members of staff based in Gateshead interested in relocating will be offered support, or helped to find alternative employment in the local area, the company added.  

Orchard House said customers and suppliers will not be impacted by the plan.

Steve Corby, chief executive of Orchard House Foods, said: “We understand that this is an incredibly difficult situation for our employees, and our priority now is to ensure that we do everything we can to support them.​ ​

He added: “Despite making significant investments in our Gateshead facility over a considerable period in an effort to turn around its financial performance, it is unfortunately still making losses that make it unsustainable over the long-term. ​

Amalgamate production

“As such, we believe that the future of the business lies in consolidation, so we are starting a review process in consultation with our staff and proposing to amalgamate production from our Gateshead site at our other fruit processing facility in Corby.” ​

Corby said this was a decision that has been taken lightly but comes off the back of an incredibly challenging period for the sector. 

“Like many other businesses across the UK, we have been suffering from a series of economic and business challenges. They include rising energy, raw material, transport and labour costs. There has also been a shortage of available staff to work at our Gateshead site,”​ he said. 

In 2021 Orchard House strengthened its leadership team with the appointment of Steve Corby and Antony Greenwood​​ as commercial director.