Thousands of jobs could go as smaller suppliers are at risk

THOUSANDS of jobs have been put at risk at some smaller suppliers who delivered close to €28 million in goods to Superquinn, as the receiver does not have funds to pay them.

The receiver appointed to debt-ridden Superquinn said suppliers will be paid quickly for any secured stock on the shelves, but said that he is not responsible for unsecured stock, that is any stock without credit insurance.

Of Superquinn’s 660 suppliers, most meat, chicken, fruit and vegetables suppliers had credit secured for their stock. Of the €50m owed to suppliers, the receiver said €22m was covered by insurance, but denies responsibility for the €28m in unsecured stock.

Musgrave’s Chris Martin said his group is not responsible for Superquinn’s prior debts, but guarantees payment on all future stock delivered.

ISME chief executive Mark Fielding says suppliers are anxious that cheques issued to them last Friday by Superquinn may not be honoured by the banks. The syndicate of Bank of Ireland, AIB and National Irish Bank appointed the receivers to Superquinn.

Mr Fielding said: “I spoke with one ISME member who is owed €73,000 and whose goods are currently for sale on Superquinn shelves. Last Friday, he received a cheque for €31,000 from Superquinn, but all such cheques are in the banking system and are unlikely to be honoured.

“He has 18 staff whose jobs are now under threat. The receiver was called in by the banks, so they will be paid first; the small guy is always paid last. This doesn’t bode well for Ireland’s reputation as a country in its treatment of small businesses.”

Supplier Tubs Sweets says it has been left short by €40,000. Kevin Ginty of Tubs Sweets has been informed by the receivers that he will not receive the €40,000 owed to him.

Mr Ginty said: “This is soul-destroying to a small start-up business like mine. I am one of many suppliers effected by this and I feel very cheated by Superquinn, who received my product in what I thought was good faith. I do, however, welcome that the chain has been placed in the hands of another Irish family business.”

IBEC’s Food and Drink Industry Ireland (FDII) estimates suppliers are owed €100m. FDII has commissioned a report to quantify the impact on creditors.

FDII director Paul Kelly said: “Any resolution must benefit all creditors. Our €100m figure is based talks with our members. The issue here is who is going to pay that money. These suppliers were already struggling without this added pressure.”

IFA president John Bryan said the takeover would see 70% of the Irish grocery market now controlled by Musgrave, Tesco and Dunnes Stores.

Mandate union assistant general secretary Gerry Light said: “We will do everything to protect the terms and conditions of the 2,800 staff at Superquinn. We have already negotiated significant changes to assist the company’s trading position and it is vital to the future success of the business that this contribution is respected.”