Member Article

Wakefield food group 2 Sisters under fire for "unreasonable" contracts

Wakefield-based food manufacturer 2 Sisters has been accused of setting “beyond unreasonable” terms in proposed contract agreements, one of its suppliers has told BBC Newsnight.

The firm has reportedly been seeking more than four months to pay its bills, a document seen by the programme shows.

It would have also been entitled to a 3% discount for paying within 90 days, but the firm said its proposal was only the starting point for a negotiation with its suppliers.

Alternatively, if a supplier rejects this option, the default payment period will be extended to 120 days.

In certain circumstances the firm says it should be allowed a further 14 days taking it up to 134 days.

Under the EU Late Payment Directive, firms should not take more than 60 days to settle bills without explicit agreement from a supplier.

2 Sisters produces Goodfella’s pizza and Fox’s biscuits, Tesco Healthy Living range chickens, the Marks & Spencer specialist Oakham brand and Elmwood chicken for the Co-operative.

It also supplies chicken to Greggs bakeries and its fish processing arm handles 8,000 tons of fish per annum which are sold in supermarkets such as Iceland and Morrisons and pub chain JD Weatherspoons.

This comes two weeks after the use of controversial “pay-to-stay” demands made by Premier Foods to its suppliers was revealed.

Premier later said its arrangement had been “misunderstood and misinterpreted” but it would “simplify” its practice.

2 Sisters supplier, Simon Fenton, told Newsnight his firm had refused to agree to the terms.

Mr Fenton, whose company makes weights, said: “The contract we got from 2 Sisters is unlike anything we’ve had from any other of our customers.

“We obviously negotiate terms and conditions with everyone we deal with but the terms and conditions and clauses laid out in the 2 Sisters one were beyond unreasonable.”

In a statement the company said: “Ultimately, the supplier can choose not to trade on any terms it feels is unsuitable, and we abide by standard business-to-business payment protocols where payment can exceed 60 calendar days as long as this is expressly agreed in the contract.”

This was posted in Bdaily's Members' News section by Clare Burnett .