Ahold Delhaize makes major investment in distribution, frozen facilities
The opportunity for seafood suppliers to partner with Ahold Delhaize USA’s numerous grocery chains in the United States just increased exponentially.
The company, which operates more than 2,000 stores such as Stop & Shop, Food Lion, and Hannaford, is investing USD 480 million (EUR 433 million) into switching to self-distribution and adding new frozen facilities.
Quincy, Massachusetts, U.S.A.-based Ahold said it will transform its supply chain network into a fully-integrated self-distribution model. In order to grow its omnichannel presence and focus more on local markets, it will acquire three warehouses from C&S Wholesale Grocers and lease two new facilities.
Ahold Delhaize will also partner with various companies to build two fully-automated frozen operations, the retail operator said in a press release.
“The two new fully automated frozen facilities will enhance capacity for frozen items, including frozen seafood products,” Ahold Delhaize USA Director of Communications for Retail Business Services Erin Dewaters told SeafoodSource.
The largest grocery retail group on the East Coast of the United States, Ahold Delhaize operates more than 1,000 trucks that deliver 1.1 billion cases to its local brands' stores. Its new supply chain plan aims to rapidly grow its e-commerce business.
It plans to transform facilities to leverage technology advancements, 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,” the retail group said.
The changes will produce “financial and strategic value within procurement, logistics and warehousing to provide the freshest product through the most advanced, efficient delivery network in the grocery industry,” Ahold Delhaize said in the release.
“Through this initiative, we will modernize our supply chain distribution, transportation and procurement through a fully-integrated, self-distribution model, that will be managed by our companies directly and locally,” Ahold Delhaize USA CEO Kevin Holt said. “This will result in efficiencies and most importantly product availability and freshness for customers of our local brands – now and in the future – whenever, wherever however they choose to shop.”
As part of its three-year supply chain strategy, Ahold Delhaize USA will increase distribution with seven new and acquired warehouses. Its two new fully-automated frozen facilities all be serve the Mid-Atlantic and Northeast U.S. markets.
The retail group will also purchase three warehouses from C&S – two locations in York, Pennsylvania, and a facility in Chester, New York. Its new facility leases include a newly renovated warehouse in Manchester, Connecticut, and a C&S facility in Bethlehem, Pennsylvania.
The company also plans to continuing to build on its relationships with vendors and suppliers and “further deepen partnerships to enhance service, quality, innovation and efficiencies.”
It’s too early in the supply chain transformation process for Ahold Delhaize to comment specifically on which new seafood species and products will be added, Dewaters said.
“What we can share at this time is that each of Ahold Delhaize USA’s local brands listen to consumer feedback and make changes to assortment to meet their needs,” she said.
Ahold Delhaize USA wants to expand its retailers’ presence in local markets and “reaffirm local community connections through the expected creation of hundreds of jobs in local communities, including positions in support offices,” the retailer said.
Ahold Delhaize USA's current distribution networks include 15 traditional and ecommerce distribution centers and a partnership with C&S Wholesale Grocers to service select brands.
“Retail Business Services, the services company of Ahold Delhaize USA, will continue to partner with C&S Wholesale Grocers to provide supply chain services as Ahold Delhaize USA transitions to a fully-integrated, self-distribution network,” Ahold Delhaize said.
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