This is a summary of the biggest Supply Chain Infrastructure issues facing foodservice distributors following the Sysco's acquisition of US Foods. These include growth and capacity, labor productivity, information technology as well as transportation and distribution networks.
4. 4|
Growth and
Capacity
We have acquired a small distributor; how do we
integrate their operations into our existing footprint?
We are out of freezer space; what is the ROI on
expanding our freezer?
Cut SKUs or Expand the Facility – what’s the right
decision?
What’s the maximum capacity for this site and how
do we get there?
Over the last 12 months, LIDD
helped foodservice customers
answer these questions.
5. 5|
Labor
Productivity
The DC is operating beyond capacity. What labor
penalty does this cost us?
How can we improve productivity through re-slotting?
Is there a relationship between slotting and picking
errors?
Can we improve inbound operations with better
appointment scheduling?
Over the last 12 months, LIDD
helped foodservice customers
answer these questions.
6. 6|
Information
Technology
How do we select the right warehouse management
system?
We cut meat and produce - we need a system to
plan the work and track our costs; what software can
help do this?
Do we need a transportation management system?
If so, which one?
Over the last 12 months, LIDD
helped foodservice customers
answer these questions.
7. 7|
Transportation
and Distribution
Networks
What can we do to reduce the time a driver spends
at the delivery?
Are we serving the right customers from the right
DCs?
Where should we build the new DC? How will it
impact delivery costs?
Over the last 12 months, LIDD
helped foodservice customers
answer these questions.
8. 8|
The Very Top of
Top-of-mind
This titanic
acquisition will
put 25% of the
foodservice
distribution
industry in the
hands of one
giant
Sysco promises $600
million in operating
savings to assure
shareholders of the
economic logic
behind the deal
Sysco committed $8.2
billion to purchase $500
million in annual earnings
from US Foods
Sysco paid $16+ for each dollar of
earnings from US Foods.
What happens if that dollar
becomes $0.95 or $0.90?
9. 9|
The US
Facilities
To achieve $600 million in savings, Sysco may
have to reduce its payroll by 6,000 people
Sysco
US Foods
Region
Sysco
facilities
US foods
facilities
Total
Pacific 9 5 14
Mountain 8 6 14
Midwest 16 17 33
West South
Central
8 7 15
Southeast 14 13 27
Northeast 12 12 24
Florida 5 4 9
total 72 64 136
10. 10|
If each DC has 200 – 250 employees in operations, sales
and administration, then Sysco will look to close 25 – 30
DCs across the US
Sysco
US Foods
11. 11|
Closing these DCs won’t be cheap,
there will be severances; productivity
losses at remaining DCs that inherit
new volumes; some fixed costs that
linger past closure.
Sysco
US Foods
12. 12|
How will
you react?
they face to reach their
goal create opportunities
to win market share?
Will the challenges
LIDD thinks so
and we’d like
to show you
how.
LIDD Consultants Inc.
www.lidd.ca
(514) 933-8777
contact@lidd.ca
Contact us or
meet with us or
schedule a call