More than 1500 people have lost their jobs and there are warnings of a worsening “supply chain crisis” after a refrigerated logistics operator collapsed.
A war of words has erupted after Scotts Refrigerated Logistics was put into liquidation with receivers unable to find a buyer for the major company.
The Transport Workers Union has called out ALDI for what it says is the supermarket giant’s part in Scotts RL’s downfall by “profiting off the razor-thin margins of operators”.
Scotts employed 1500 people with the business running 500 trucks and 1500 trailers from 24 warehouses.
“There will be 1500 devastated families today as workers stare down the direct consequences of wealthy companies like ALDI squeezing the life out of transport contracts,” TWU national secretary Michael Kaine said.
“Scott’s Refrigerated Logistics is a major casualty of an industry-wide crisis that’s pushing operators and drivers to the brink, which will have an enormous impact on our essential grocery supply chains.”
ALDI has strongly rebuked the TWU’s statements, saying it “had hoped the challenges facing Scott’s could have been overcome”.
“Statements made by the TWU with regard to our business results and our supplier relationships are categorically untrue, baseless and damaging,” ALDI Australia said via a spokesperson.
“We refute this commentary from the TWU in its entirety.”
The supermarket says it comprised only three per cent of Scott’s business.
TWU National Secretary Michael Kaine called out ALDI for allegedly contributing to the company’s downfall. Picture: NCA Newswire / Gaye Gerard
Receivers KordaMentha had said earlier this week that they anticipated a “high level of interest in this business and its assets, given its significance in the cold chain supply system in Australia”.
However, no buyer has stepped up to the plate.
Supermarkets have been left scrambling to minimise the impact to their supply chains, with concerns the shutdown could affect what’s inside their fridges and freezers.
Coles have said they are “working hard to minimise disruption for customers and our farmers”.
ALDI rejected Mr Kaine’s comments on Friday. Picture: NCA NewsWire
“Our focus remains on continued availability of refrigerated products in stores and online for customers,” a spokesperson said.
“We are working quickly to transition to our other transport partners and are closely monitoring deliveries across our supply chain.”
Woolworths said it was working with impacted suppliers to “maintain continued products to our distribution centres”.
According to the TWU, almost 200 transport companies have become insolvent in the 2021-22 financial year.
“Scott’s is not the first transport company to be pushed out of the market by profit-hungry clients at the top of supply chains, and it won’t be the last unless we enact reform to ensure those clients are accountable for fair, safe and sustainable transport contracts,” Mr Kaine said.