Trucking giant's collapse risks $500 million of frozen food going to waste
More than $500 million worth of frozen food risks being binned after a giant Australian trucking company collapsed.
Scott's Refrigerated Logistics entered voluntary administration last Monday, leaving 1500 employees in the lurch.
It is a massive freight business for supermarkets, moving on average 8000 pallets daily to major grocery retailers, independent supermarkets, food manufacturers and exporters.
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Receiver KordaMentha confirmed today the fate of more than $500 million worth of cold items is up in the air as it is trying to relocate about 114,000 pallets of food.
Scott's has 24 warehouses across Australia that need to be emptied due to the company's collapse, but because there are limited alternative cold storage facilities, these products risk being binned.
Coles said it has removed all its stock from the Scott's storage facilities, but some of the supermarket giant's supplier did have their own transport and storage arrangements in place directly with the failed logistics company.
"Our focus remains on continued availability of refrigerated products in stores and online for our customers," a Coles spokesperson told 9News.com.au.
"Coles is no longer relying on Scott's Refrigerated Logistics for our deliveries and we have transferred services to our other transport partners.
"Our teams are also working with suppliers who previously managed their own deliveries directly with Scott's, and we are helping them to quickly secure new options to continue deliveries to major supermarkets. We will continue to closely monitor deliveries across our supply chain.
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"We are working hard to minimise disruption for customers and our farmers and suppliers as deliveries ramp up."
KordaMentha earlier warned there will be supply disruptions for Scott's other contracted supermarkets including Woolworths and Aldi.
"We're working closely with our impacted suppliers to maintain continued products to our distribution centres." a Woolworths spokesperson said.
Aldi expressed its sympathies to Scott's as the freight industry is hit by residual COVID-19 pandemic impacts, diesel shortages and soaring fuel prices.
"The supermarket supply chains rely on many interdependent partnerships, following the challenges presented this week from Scott's Refrigerator Logistics, we have worked with our existing logistics partners to ensure the 3 per cent of Scott's business managed for ALDI now transitions to other logistics partners," an Aldi spokesperson said.
Earlier, KordaMentha's Scott Langdon anticipated there would be a great deal of interest in snapping up the business.
But this didn't come to fruition as the firm approached interested parties about the sale of Scott's but was unsuccessful in securing any bids last Friday, KordaMentha said.
The collapse of the freight giant comes as the industry faces heavy pressures, particularly with fuel costs.
According to the Transport Workers Union, almost 200 companies in the transport industry became insolvent in 2022 alone.
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