UK: Costcutter ends Nisa agreement and joins forces with Palmer & Harvey
The deal will also see Costcutter take over the running of the Mace symbol group owned by P&H, as well as the Supershop CTN fascia group and Your Store in Northern Ireland.
A key part of the deal is the formation of a new 50:50 joint venture company, The Buyco, with £5bn-worth of buying power, created to serve the Costcutter group’s 1,600-plus franchise stores, P&H’s existing independent retailer customers and its 800 symbol/fascia stores.
In addition, Costcutter has signed a new eight-year wholesale distribution deal with P&H.
Darcy Willson-Rymer, chief executive of Costcutter Supermarkets Group, said: “We have been single-mindedly focused on creating value for our members and it became wholly apparent that without access to the proportionate benefits of our own buying power, this could not happen.
“Through the creation of The Buyco with P&H, we will have unrivalled purchasing power within the UK convenience sector.”
The deal will also see the development of a new, three-tier own label range for the group, including an extensive chilled and fresh offer.
Martyn Ward, chief executive of The Buyco and managing director for commercial sales at P&H, said the joint buying company would work “to ensure we are providing not simply the largest range but the highest-value range possible.”
Costcutter stores, including Kwiksave, will get their deliveries via P&H’s network of 14 depots, and there will be a new distribution centre in Northern Ireland.
The Mace stores will retain their name but transfer to Costcutter control next April and the new supply deal will come into place as the contract with Nisa ends in July 2014.
Source: Independent Retail News
