Palmer and Harvey and Costcutter Supermarkets Group have announced plans to close The BuyCo, the independent negotiating company set up as a joint venture between both businesses.

The BuyCo was established in 2013 with the intention of offering customers enhanced value by leveraging the combined buying power of the two companies.

However, the two companies said that with this securely in place and with the changing nature of today’s market, any further benefits the BuyCo could bring were limited.

The BuyCo’s negotiating responsibilities will continue within both Palmer and Harvey and Costcutter Supermarkets Group. Palmer and Harvey now plans to restructure its category team.

Martyn Ward, managing director of Palmer and Harvey, said: “BuyCo was set up as a joint venture between Costcutter Supermarkets Group and Palmer and Harvey, to harmonise negotiating terms across our supplier base. Now that that’s been achieved, the negotiating and buying functions of The BuyCo are being brought back in house. This announcement does not affect our supply agreement with Costcutter Supermarkets Group, they will continue to be a valued Palmer and Harvey customer.”

“Palmer and Harvey are on a journey to simplify our business, ensuring that we can continue to deliver the best offer to retailers.”

Darcy Willson-Rymer, chief executive of Costcutter Supermarkets Group, said: “The market and our own capabilities have evolved considerably over the past four years meaning it is now the right time to adapt our business and the way we operate to reflect the market changes we are all seeing. Our retailers will still benefit from the value from volume our partnership with P&H delivers and our trading team will ensure we continue to have strong relationships with our suppliers.”