Major suppliers, including Procter & Gamble and Nestlé, have tightened the restrictions on their supply terms for Poundland, leading to a shortage of products across the stores.

Suppliers are taking a step back from the struggling retailer due to the economic volatility over the past few months for the discounter.

According to a report by The Times, a source revealed that fast-moving consumer goods brands have cut down their credit agreements as suppliers are more cautious due to the ongoing restructuring.

Poundland was sold to US restructuring firm Gordon Brothers for £1 after failing to deliver solid financial results under the brand portfolio of its previous owner, Pepco Group.

As part of the restructuring plan, Gordon Brothers may axe off frozen food sections and shutter up to 68 locations, which is a serious concern for suppliers.

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A Poundland spokesman said: “Our expectation is that any credit limitations for suppliers will unwind in time after we have the opportunity to implement the restructuring and recovery plan we shared last month.

We have been briefing suppliers this week about those plans and appreciate the support they’re providing.”

Procter & Gamble products, including Lenor fabric conditioner, Febreze sprays, Oral-B toothpaste, and Always feminine hygiene products, were in low stock on shelves across London.

Additionally, Nestlé’s chocolate ranges were in short supply and were not restocked as frequently as before.

Moving forward, Gordon Brothers is in the process of actively seeking court approval for its plans to restructure, with the process set to be completed by the end of August.

Meanwhile, trade suppliers are being informed of the recovery plans, and a supplier meeting was carried out on Wednesday in Walsall.