Premier Foods
Premier Foods has been in the news over the weekend over reports of its “pay-to-stay” demands for
upfront cash from its supplier base. This latest attempt to persuade its suppliers to stump up cash to
stay on the approved supplier list is once again generating an angry response from the Solids
Handling and Processing Association members as the last attempt did in August 2013. SHAPA
considers this practice to be contractually unfair.
The BBC broke the story on Thursday 4th December, Vince Cable got involved as did others such as
the IOD and the Federation of Small Businesses, eventually causing Premier Foods to back down and
withdraw its scheme over the weekend. However, Sajid Javid, The Culture Secretary said in a speech
in Birmingham on Saturday that, “we will legislate to take action against unfair contractual
practices…”. So it seems that government has now taken notice, but SHAPA (which represents
manufacturers and suppliers of solids handling and processing equipment) recognises the need to
keep the pressure on.
SHAPA understands that the issue is outside the remit of the Groceries Adjudicator, but the
Federation of Small Businesses is campaigning to get legislation in place to stop the practise (and
other unfair practices). SHAPA has urged its members to make contact with FSB and we strongly
encourage other interested parties to do the same.