Sainsbury’s & Asda throw lifeline to collapsing distributor

Sainsbury’s and Asda are set to take over EVCL Chill, their faltering distributor, in a move that could save hundreds of jobs.

According to The Grocer, the retailers have been in talks about saving a significant chunk of the logistics company with administrator PwC.

One source said it could cost “millions” to keep EVCL afloat, which employs 1000 workers and supplies the supermarkets with up to 10,000 pallets a day.

Contracts will need to be renegotiated following its expected administration, potentially meaning a second pay-out for drivers and warehouse staff.

READ MORE: 1000 jobs at risk as Sainsbury’s distributor faces collapse

Neither Sainsbury’s nor Asda would provide a comment.

Suppliers who work with the company have been told to find a different haulage company from the weekend.

It will be a fresh blow to the supply chain, already straining from a shortfall of lorry drivers.

One expert suggested that EVCL’s collapse could lead to shortages of fresh food in the coming days.

“We’re seeing many of these suppliers desperately calling other logistics firms to pick up their business, but no one has any spare capacity,” they said. 

“It means many of them will potentially have no route to market from the end of the week.”

According to the Road Haulage Association, Britain has a shortage of around 90,000 lorry drivers.

The government is tackling the backlog of driving tests which built up during the Covid-19 pandemic, but has resisted calls for a haulier visa.

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