Dairy Crest has retained the contract to supply liquid milk to Sainsbury’s until 2017.
The processor announced today (Tuesday 19 February) news it had secured a new three-year contract to supply the retailer from February 2014.
Conditions of the contract are set to change from 2014 but the company says any financial impact caused by these will be offset by ongoing cost reductions in the business.
A spokesperson for the company said any financial impact caused by a change in contractual conditions, would not be passed on to farmers.
“We are having to make savings to keep our numbers the same, and we are taking cost out of our business.”
In order to make savings, the company has undergone reorganisation in a bid to make annual cost savings of at least £5m.
Changes include Tom Atherton moving to the role of finance director, following his post as director of financial control for the past four years. The executive board will comprise Mr Atherton, executive managing director Martyn Wilks and chief executive Mark Allen.
“The reorganisation announced today is right for Dairy Crest. It reflects our focus on consumers and customers as we continue the progress we have made in simplifying the business and becoming more efficient,” said Mr Allen.