Job losses at Northern Foods as talks collapse with M&S

Leeds-based Northern Foods, which is one of Britain’s biggest food suppliers, is to axe over 700 jobs at its Fenland Foods site in Grantham, Lincolnshire.

The company, which makes Italian ready meals for Marks & Spencer (M&S) at its Grantham site, said a new contract has not been reached with the retailer which will result in 730 job losses at the factory.

Northern Foods chief executive, Stefan Barden, said the Fenland Foods facility in Grantham would be shut down in the summer and it could be 2 years until the site re-opens.

Mr Barden said the group had been unable to agree a deal with M&S that would have generated an adequate return. He added we are shaking hands on it, we are moving on, they are moving on. We couldn’t find a business model that was profitable for us.

It is believed negotiations are underway with Waitrose while Northern Foods has also stepped up supplies to Asda.

The Fenland factory was built 21 years ago to specifically supply M&S. It has generated £45 million a year through the sale of mainly Italian-themed ready meals to M&S stores including lasagne, the retailer’s best-seller.

M&S makes up for around a third of Northern Food’s total turnover. Mr Barden maintains that the closure of the site will not hit profits in the current year.

Northern Foods, whose brands also include Goodfellas Pizza and Fox’s biscuits, employs approximately 11,000 people in total at 22 operating sites in the UK and Ireland.

A spokesperson for M&S said Northern Foods decided the site was no longer economical and they decided to proceed with the closure and added that they remain an important supplier to us and we will continue to work with them.

The news follows that from food producer, Uniq, who is to shut its factory at Paignton, Devon. The maker of trifles and chocolate puddings for supermarkets said it will axe 390 jobs as a result of the site closure.

Story link: Job losses at Northern Foods as talks collapse with M&S