The Co-op Group will become the exclusive wholesale supplier to Costcutter Supermarkets Group, (CSG) it has been announced.
The Group jumped in to fill the gap left by the collapse last week of wholesale giant Palmer and Harvey (P&H), which supplied about 90,000 outlets around the UK including major chains, convenience stores, corner shops and petrol station forecourts.
From spring 2018, the Group will become the exclusive wholesale supplier to CSG and the 2,200 Costcutter, Mace, Simply Fresh, Supershop and Kwiksave convenience stores across its network.
The deal will also provide the opportunity for CSG’s independent retailers to become Co-op franchisees.
Given the unexpected P&H announcement, the Group says it is also looking at practical short-term ways to support independent retailers within CSG.
Jo Whitfield, chief executive of Co-op Food, said: “We are operating in a dynamic market environment and this deal, coming shortly after our Nisa announcement, shows how we are positively responding to the changes occurring within the sector.
“Our Food business is going from strength to strength in what is clearly a challenging retail market. We recently reported our 14th consecutive quarter of like-for-like sales growth and this agreement will further strengthen our ability to offer customers great products at great prices.”
She added: “While our deal with Costcutter will start formally in spring 2018 we are looking at practical ways we can support independent retailers during this busy trading period, in light of the news concerning P&H. It is essential that we maintain a strong independent retail sector and the Co-op is committed to playing its part, along with others in the industry, in ensuring this occurs.”
Costcutter chief executive Darcy Willson-Rymer said: “With P&H no longer able to supply our stores, we have activated our contingency plans that will see our retailers supported by the Co-op and other suppliers in the run-up to our deal with the Co-op.”