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Sainsbury’s after big names

Sainsbury’s wants to increase the number of big-name contractors it works with on its Ł500 million a year building programme.

The supermarket giant spends its money on new-build stores, extensions and fit-outs.

Its Tier One list of contractors features quoted companies Costain and Kier along with Pearce - the Bristol-based subsidiary of another quoted firm, ISG - as well as privates Bowmer & Kirkland, RG Group and Longcross.

The man in charge of the spending programme said Sainsbury’s was looking at working with a number of other large firms. These include Carillion, Laing O’Rourke and Taylor Woodrow - all of which it has been talking to.

Commercial director Neil Sachdev said he was happy with the firms on the framework but admitted: “We are looking at increasing the list and that might mean people falling off.

“Bigger firms have a much bigger skills base and a broader technical know-how. We hope that like us they have very talented people working for them. Contractors have a right to earn money and profit because we want firms working with us that can invest in people and innovation.”

Mr Sachdev, who spent 28 years at Tesco before joining Sainsbury’s to head its building programme last year, admitted he was mystified by the apparent reluctance of some firms to work with the Ł19 billion turnover company.

He said: “My door is wide open. I can’t keep phoning them. Maybe it’s not the right people phoning me but it would be nice if they phoned me.”

He said he will be opening 10-15 new stores and extending up to 24 existing stores between now and 2010 to increase floor space nearly 10 per cent.

Mr Sachdev said the supermarket, which this month posted pre-tax profits of £479 million in the year to March, understood its costs very well and he suspected contractors tended to bypass the retailer because they thought there was no way to force themselves onto a framework.

He added: “I think some think it’s a closed house and they won’t be able to get on it. That is absolute poppycock. We never sack a contractor, we just reduce their workload.”

Mr Sachdev was recently promoted to a 12-strong operating board that reports directly to the main board led by chief executive Justin King.