Sainsbury’s streamlines suppliers

SAINSBURY‘S ANNOUNCED this week (w/e Aug 27) that from Jan 2005 it will be buying all its milk from just two suppliers.

The supermarket sells about 450m litres, worth £228m a year, and the move will see an approximate increase in retail value to Robert Wiseman Dairies of £125m and £15m to Dairy Crest. 

Arla Foods UK will be the loser, with about 100m litres of lost sales.

Farmers will be concerned that the deal could put pressure on farm-gate prices. But a spokeswoman denied it had involved any undercutting of contracts with existing suppliers.

The new contract is for 18 months.