UK-based meat business Tulip, which is part of Denmark co-operative Danish Crown, could lay off hundreds of workers after losing out in a tender with a “major customer”.
The affected site is located in the town of Boston, Lincolnshire, and employs 464 people, a Tulip spokesperson confirmed to just-food. Asked whether the plant might be due for closure, the spokesperson added: “We are thoroughly exploring all available options. At this stage, all we can confirm is that there may be job losses at the site. Tulip can confirm it has informed its workforce at Boston that it has been unsuccessful in a major customer tender process.”
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Consultations will soon take place with the cooked meat plant’s works committee over potential job losses. “It is anticipated that existing commercial commitments will come to an end in August,” the spokesperson said.
“We have been notified of a decision in respect of a tender process with a key customer. The news is not what we had expected and, clearly, we are all deeply disappointed by this news.”
In January, meat giant Danish Crown warned it may be forced to eliminate around 300 to 400 jobs due to the underperforming Tulip business and also postpone planned projects. However, further details were not provided.
Tulip turned in a bigger-than-expected operating loss of DKK260m (US$39.6m) last year. After launching a detailed review of the business, Danish Crown said the subsidiary’s operating costs were too high and the company had been unable to “optimise” its UK supply chain. A consequent DKK200m cost-cutting plan was put in place resulting in the loss of 150 Tulip jobs.
Tulip also operates other sites in Lincolnshire based in Ruskington and Spalding, and in nearby King’s Lynn. Despite being unsuccessful in the tender process weighing on the Boston site, Tulip said it had secured other long-term agreements.
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By GlobalDataThe spokesperson added: “We are committed to saving DKK200m during the current financial year and getting the business back into profit. This has been boosted in recent weeks, having signed new long-term agreements with two key strategic customer partners. However, our immediate focus is on ensuring we support our colleagues in Boston.”
