Sainsbury’s suppliers face delayed final payment terms as another horror story ends

The 1st October saw Medina’s liquid processing facility at Watsons Dairies Southampton finally close its doors at the same time its 3 year contract to supply liquid milk to Sainsburys ended. 

When Medina were awarded the Sainsburys contract, little did they realise how much pain and financial burden it would inflict. Medina invested circa £3 million in their Watsons Dairy and supplied liquid milk to Sainsbury’s from 18 farmers. That contract ended on 30th September and the farmers have had the dairy equivalent of a Bossman transfer to either Arla or Muller. 
The closure of the Watsons facility, together with other ongoing challenges in particular the resurgence of Covid 19 and daily closure of coffee shops and hospitality venues, has necessitated Medina paying 50% of the Sainsbury farmers on the 29th October, money two weeks later than scheduled, to assist with cash flow.

Note, this does not affect the regular payment schedule for all other Medina contracted farmers.

At least the Medina involvement with Sainsburys didn’t end quite as bad as it did for Tomlinsons, who ironically were offered contract renewal terms to continue to supply Sainsburys before they folded. The odds are that Medina couldn’t wait for the day its 3 year involvement with Sainsburys ended.