Supervalu to add produce distribution firm, W. Newell & Co.
Supervalu to add produce distribution firm, W. Newell & Co.
In an effort to further emphasize fresh produce in its own stores and the stores it services, Supervalu has announced the formation of a specialty produce distribution company, W. Newell & Co., to be headquartered in Champaign, IL, and which will initially service two of the company's seven regions.
With 1,500 corporate-owned retail grocery operations, the Minnesota-based retailer is one of the country's larger. And as a grocery and produce wholesale and distribution firm, the company also services 3,200 independent and smaller retailers. Those retailers are located throughout the United States, though the Midwest is the strongest geographic area for the organization.
Currently, Supervalu is organized into seven regions and 23 distribution centers. All products are distributed through those centers with the store location rather than the product determining the distribution route.
Long-time produce industry member Gary Gionnette has been named chief operating officer of W. Newell & Co., which will initially serve about 600 stores with produce-only deliveries. The new distribution center will take over the produce supply job currently being served by five general distribution centers, spanning eight states and two Supervalu regions.
Mr. Gionnette said that the new produce-only facility is scheduled to open in early August and will allow Supervalu to place added emphasis on produce. He said that W. Newell & Co. will be able to provide its customers -- including the corporate stores and the independent retailers -- with higher quality produce, largely because it will be fresher. He said that the state-of-the-art produce facility will be able to shave one to three days off the typical distribution time that it takes fresh produce to get from the field to the consumer under Supervalu's current distribution pattern.
Mr. Gionnette explained that the W. Newell operation will be able to be much more efficient and have much tighter inventory control, largely because of the volume of produce that will be running through the operation. He said that combined with the produce-only deliveries, this will create faster turnaround times, which, he said, will result in greater consumption by the consumer and overall growth for Supervalu.
Mr. Gionnette's career has included stints on both the supply and buy sides of the equation, so he is well aware of the efficiencies that can be realized by the opening of this new facility.
Besides working for Supervalu for a number of years, he also is a Safeway veteran and served as chief executive officer of Driscoll Strawberry Associates in Watsonville, CA. He stopped short of calling this a prototype for all of Supervalu's divisions, but said clearly that if it works the way it is intended, it should serve as a model for the company.
Mr. Gionnette said in a company statement, "For the last several years, we have carefully analyzed the traditional produce supply chain. W. Newell & Co. will introduce many improvements in the procurement, inbound transport, warehousing and delivery of produce to our retailers. We believe this company will provide our retailers with better produce quality, wider variety and stronger customer service capabilities than any other specialty produce provider."
In an interview with The Produce News, Mr. Gionnette reiterated those points and said it is no secret that the produce department is the section of the supermarket where retailers are trying to differentiate themselves. He said Supervalu expects this added emphasis on produce to result in growth in store sales.
According to the firm's press release, Supervalu "is one of the largest produce distributors in the United States and ranks among the top 10 companies that distribute fresh produce nationally."
W. Newell & Co. will serve as the company's national produce procurement organization and will surely become one of the top-volume buyers in the country. Mr. Gionnette said that the buying and distribution operations will be phased in throughout the remainder of 2005, once the facility opens. The Champaign facility itself consists of a 155,000-square-foot warehouse with a price tag of $25 million. It will be one of the larger produce distribution centers in the Midwest in terms of volume, serving retailers in Illinois, Indiana, Iowa, Kentucky, Michigan, Missouri, Ohio and Wisconsin. Included are Supervalu's major corporate retail markets of Chicago, St. Louis, Cincinnati and Fort Wayne, IN.
The company press release promises "web-enabled buying and selling to strengthen retailer relationships and enhance customer service. By providing retailers with real-time connectivity that allows them to make purchases, track their orders and access their account information on-line, account managers will be able to focus more on service and less on administrative tasks."
Mr. Gionnette said that no final decisions have been made regarding new technologies such as radio frequency identification, but he said that all supply-side management technologies and efficiencies are being explored and discussed.
The company has announced that W. Newell & Co. will adopt a one-to-one relationship-driven sales model. The focus will be on building and maintaining relationships with retailers through produce-only account managers. The new customer support model will enable the company to customize a produce offering to fit the needs of every type of retailer.
"Each of our retailers will have a dedicated customer account team that will focus on improving their business and assisting with key operation requirements, such as product and market information, retail promotions, forecasting, problem resolution and training programs," Mr. Gionnette said in the statement. "This will allow us to meet individual retailers' needs for consistent, high-quality produce, frequent deliveries to optimize freshness and better overall customer service."
He told The Produce News that W. Newell & Co. is the culmination of five years of research and discussions as Supervalu executives launched an initiative in 2000 designed to build a better produce distribution program.
The company name is derived from the parent company of Supervalu, which is Winston & Newell. The name is coming full circle as Winston & Newell began as a produce company in 1937, according to the Supervalu press release.
With 1,500 corporate-owned retail grocery operations, the Minnesota-based retailer is one of the country's larger. And as a grocery and produce wholesale and distribution firm, the company also services 3,200 independent and smaller retailers. Those retailers are located throughout the United States, though the Midwest is the strongest geographic area for the organization.
Currently, Supervalu is organized into seven regions and 23 distribution centers. All products are distributed through those centers with the store location rather than the product determining the distribution route.
Long-time produce industry member Gary Gionnette has been named chief operating officer of W. Newell & Co., which will initially serve about 600 stores with produce-only deliveries. The new distribution center will take over the produce supply job currently being served by five general distribution centers, spanning eight states and two Supervalu regions.
Mr. Gionnette said that the new produce-only facility is scheduled to open in early August and will allow Supervalu to place added emphasis on produce. He said that W. Newell & Co. will be able to provide its customers -- including the corporate stores and the independent retailers -- with higher quality produce, largely because it will be fresher. He said that the state-of-the-art produce facility will be able to shave one to three days off the typical distribution time that it takes fresh produce to get from the field to the consumer under Supervalu's current distribution pattern.
Mr. Gionnette explained that the W. Newell operation will be able to be much more efficient and have much tighter inventory control, largely because of the volume of produce that will be running through the operation. He said that combined with the produce-only deliveries, this will create faster turnaround times, which, he said, will result in greater consumption by the consumer and overall growth for Supervalu.
Mr. Gionnette's career has included stints on both the supply and buy sides of the equation, so he is well aware of the efficiencies that can be realized by the opening of this new facility.
Besides working for Supervalu for a number of years, he also is a Safeway veteran and served as chief executive officer of Driscoll Strawberry Associates in Watsonville, CA. He stopped short of calling this a prototype for all of Supervalu's divisions, but said clearly that if it works the way it is intended, it should serve as a model for the company.
Mr. Gionnette said in a company statement, "For the last several years, we have carefully analyzed the traditional produce supply chain. W. Newell & Co. will introduce many improvements in the procurement, inbound transport, warehousing and delivery of produce to our retailers. We believe this company will provide our retailers with better produce quality, wider variety and stronger customer service capabilities than any other specialty produce provider."
In an interview with The Produce News, Mr. Gionnette reiterated those points and said it is no secret that the produce department is the section of the supermarket where retailers are trying to differentiate themselves. He said Supervalu expects this added emphasis on produce to result in growth in store sales.
According to the firm's press release, Supervalu "is one of the largest produce distributors in the United States and ranks among the top 10 companies that distribute fresh produce nationally."
W. Newell & Co. will serve as the company's national produce procurement organization and will surely become one of the top-volume buyers in the country. Mr. Gionnette said that the buying and distribution operations will be phased in throughout the remainder of 2005, once the facility opens. The Champaign facility itself consists of a 155,000-square-foot warehouse with a price tag of $25 million. It will be one of the larger produce distribution centers in the Midwest in terms of volume, serving retailers in Illinois, Indiana, Iowa, Kentucky, Michigan, Missouri, Ohio and Wisconsin. Included are Supervalu's major corporate retail markets of Chicago, St. Louis, Cincinnati and Fort Wayne, IN.
The company press release promises "web-enabled buying and selling to strengthen retailer relationships and enhance customer service. By providing retailers with real-time connectivity that allows them to make purchases, track their orders and access their account information on-line, account managers will be able to focus more on service and less on administrative tasks."
Mr. Gionnette said that no final decisions have been made regarding new technologies such as radio frequency identification, but he said that all supply-side management technologies and efficiencies are being explored and discussed.
The company has announced that W. Newell & Co. will adopt a one-to-one relationship-driven sales model. The focus will be on building and maintaining relationships with retailers through produce-only account managers. The new customer support model will enable the company to customize a produce offering to fit the needs of every type of retailer.
"Each of our retailers will have a dedicated customer account team that will focus on improving their business and assisting with key operation requirements, such as product and market information, retail promotions, forecasting, problem resolution and training programs," Mr. Gionnette said in the statement. "This will allow us to meet individual retailers' needs for consistent, high-quality produce, frequent deliveries to optimize freshness and better overall customer service."
He told The Produce News that W. Newell & Co. is the culmination of five years of research and discussions as Supervalu executives launched an initiative in 2000 designed to build a better produce distribution program.
The company name is derived from the parent company of Supervalu, which is Winston & Newell. The name is coming full circle as Winston & Newell began as a produce company in 1937, according to the Supervalu press release.
