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Tonbridge: Jobs lost as Southern Salads goes out of business

By KentOnline reporter

A family-run company that supplied fresh salads to supermarkets, restaurants and travel chains across the UK has gone out of business, costing around 260 people their jobs.

Administrators say Southern Salads, based in Tonbridge, has ceased trading with immediate effect.

They confirmed all but a handful of its approximately 260 staff have been made redundant.

Southern Salads is based in Tonbridge. Picture Instant Street View

Southern Salads is based in Tonbridge. Picture: Instant Street View

Ian Vickers and Chris Stevens, partners at FRP Advisory, have been appointed joint administrators.

They said the immediate priority was to assist everyone made redundant with timely claims to the Redundancy Payments Service.

Mr Vickers said: "Southern Salads, a family-run Kent-based business, had traded for around 30 years, and managed over the years to deal with the increasingly competitive pricing pressures from supermarkets and other retail chains faced by all food supply businesses. 

"The company invested heavily in 2014 to expand its production capability which put pressure on working capital and the expected increase in turnover never materialised.

"Turnover in 2016 reached over £30 million. 

"Despite successfully producing over 50 tonnes of salad per day for its array of customers, the company faced an unprecedented pressure on cash flow in the immediate aftermath of last summer’s EU referendum vote.

"Despite successfully producing over 50 tonnes of salad per day, the company faced an unprecedented pressure on cash flow in the aftermath of last summer's EU referendum vote" - Ian Vickers

"The sudden decline in sterling was not foreseen by the company, leaving the business grappling with an immediate fall of between 10% and 20% in its purchasing power for overseas-grown salads required for the winter and early spring UK market which in turn put a severe strain on cash-flow.

"With insufficient protection from its currency hedging arrangements, pressure increased on cash-flow as the business traded through to this spring.

"The company was unsuccessful in negotiating any significant changes to its pricing terms with its suppliers in mainland Europe, while also being unable to pass on its cost increases to supermarkets and its other customers.

"The company relies on European suppliers for fresh vegetables and fruit from the Netherlands and Poland in the north to France, Italy and Spain in the south."

Mr Vickers said Southern Salads engaged with advisers from FRP Advisory earlier this summer as it sought to restructure the business, including seeking new investment and engaging in detailed sales talks with interested parties.

However, once these collapsed the company was let with no viable alternative other than to go into administration. 

Tom Tugendhat, MP for Tonbridge and Malling, said: "I'm sorry to see Southern Salads - a recognisable, family run Tonbridge business stop trading. 

"Obviously, this will be a difficult time for all employees. If you are affected, are losing your job or know anyone who is please email me on tom.tugendhat.mp@parliament.uk or call 01732 441563.
 
"My team and I are able to offer advice and support on anything following from this. Please get in touch if you need any help." 

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