Ahold Delhaize USA announces a three-year term of $ 480 million
QUINCY, Mass., Dec. 10, 2019 (GLOBE NEWSWIRE) – Ahold Delhaize USA today announced plans to transform and expand its U.S. supply chain operations over the next three years through investments of $ 480 million, including leases. The investment supports a strategy to transform the supply chain network into a fully integrated self-selling model. The move includes the acquisition of three warehouses from C&S Wholesale Grocers and new leases for two additional facilities. In addition, Ahold Delhaize USA will work with various companies to build two fully automated freezer systems. The initiative will provide the infrastructure necessary to support aggressive omnichannel growth plans.
Through the three-year strategy, Ahold Delhaize USA and its companies will:
- Increase in sales presence with seven new and acquired warehouses, including two fully automated freezers in the Northeast and Central Atlantic;
- Track optimal location locations near Ahold Delhaize USA’s local brands and their customers for local product expansion, increased product freshness and delivery speed;
- Innovation in warehouse design, including redesigning facilities to improve automation and leverage technological advances, such as an integrated transportation management system and end-to-end forecasting and replenishment technology designed to support the omnichannel experience and multi-channel growth;
- Continue to build on relationships with vendors and suppliers and further deepen partnerships through integration to improve service, quality, innovation and efficiency; and
- Expand Ahold Delhaize USA’s companies’ presence in local markets and reinforce connections with local communities with the anticipated creation of hundreds of local community jobs, including support office positions.
“Today’s announcement is yet another example of how Ahold Delhaize USA is transforming our infrastructure to support the next generation of grocery retail,” said Kevin Holt, chief executive officer of Ahold Delhaize USA. “Through this initiative, we will modernize our supply chain sales, transportation and procurement through a fully integrated self-sales model that is managed directly and locally by our companies. This leads to increased efficiency and, above all, to product availability and freshness for customers of our local brands – now and in the future – whenever and wherever they want to shop. ”
Three year expansion plans
Today, the Ahold Delhaize USA company distribution network includes 15 traditional and e-commerce distribution centers serving Ahold Delhaize USA’s local brands including Food Lion, Giant Food, GIANT / MARTIN’S, Hannaford, Peapod and Stop & Shop. The network will grow to 22 locations by 2023. To date, Ahold Delhaize USA companies have partnered with C&S Wholesale Grocers to serve select brands in the USA. Retail Business Services, the services company of Ahold Delhaize USA, will continue to work with C&S Wholesale Grocers to provide supply chain services in the transition from Ahold Delhaize USA to a fully integrated self-distribution network.
“Moving to a self-managed supply chain will enable Retail Business Services to lower the cost of the local brands they serve, improve inventory time, deepen relationships with vendors and our companies’ distribution centers in the communities they serve to position itself better, “said Chris Lewis, executive vice president, supply chain for retail business services. “These changes will allow us to leverage the financial and strategic value within sourcing, logistics and warehousing to deliver the freshest products through the most advanced and efficient delivery network in the food industry. We will continue to work with key distribution center management providers, including third party labor services, such as our long-term partner C&S. “
As part of the expansion, Ahold Delhaize USA will purchase three warehouses from C&S, including two locations in York, Pennsylvania and one in Chester, NY
Of the two fully automated freezer systems, one will serve the mid-Atlantic market and the other the northeast. In addition, the company will also pursue two new leases. One lease will include a newly refurbished warehouse in Manchester, Connecticut, and another will include the rental of a C&S facility in Bethlehem, Penn.
“Part of our strategy is to get the most out of automation and technology,” added Lewis. “Each facility will also have a significant workforce. We understand that the future of work is changing and we are taking active steps to help our employees adapt by enabling them to work more efficiently. “
This expanded distribution network will cover Ahold Delhaize USA’s local brands from Maine to Georgia.
Taken together, Ahold Delhaize USA’s companies form the largest grocery retail group on the East Coast and the fourth largest group in the country with nearly 2,000 retail stores and more than 6 million online grocery orders annually. In addition, Ahold Delhaize USA’s companies operate some of the largest supply chain operations on the East Coast, including more than 1,000 trucks that travel more than 120 million miles annually and deliver 1.1 billion boxes to local brand stores.
About Ahold Delhaize USA
Ahold Delhaize USA, a division of Zaandam-based Ahold Delhaize, is the parent company of Ahold Delhaize’s US companies, including local brands Food Lion, Giant Food, GIANT / MARTIN’S, Hannaford and Stop & Shop, as well as online grocer Peapod, Retail Business Services, a US support services company that provides services to the brands; and Peapod Digital Labs, its e-commerce engine. Taken together, Ahold Delhaize USA’s local brands make up the largest grocery retail group on the East Coast and the fourth largest grocery retail group in the country, operating more than 2,000 stores and distribution centers in 23 states, serving millions of customers each week through a variety of store formats with thousands of foods – and non-food items.