Marks & Spencer are the latest big name to start squeezing suppliers to slash costs , as the retailer desperately seeks ways to offset the slump in the value of the pound.
Stalker doesn’t know if this squeeze extends to Irish mushroom growers, but you can bet it will.
Several suppliers say that M&S is trying to renegotiate the terms of contracts as the fall in sterling and the collapse in consumer spending hit profits, which are expected to fall by over 40% to £560m in the year to March.
"It's a constant battle to maintain agreements that were signed off before the economic crisis took a turn for the worse last autumn," said one supplier. M&S denied that it was engaged in any concerted attempt to overturn contracts or shake up the way it does business with its suppliers, whom it regards with "the utmost respect". A spokesman said: "There is always a process of ongoing discussions with our suppliers about pricing. We are working hard with them to close the gap that has opened up as a consequence of the decline in value of the pound."
Brokers say that after hedging is taken into account, currency costs could add 10% to the company's costs this financial year.
This isn't just any o;ld squeeze, this is a Marks & Spencer squeeze.
