Supply Scan

News and trends from across the food supply chain.

Global Cold Chain Alliance Launched

For years, several organizations in the cold chain industry have been moving toward closer relationships. Now it's official: The Global Cold Chain Alliance, an umbrella organization that unites partners to facilitate communication, networking and education for the perishable food industry, has launched.

The launch took place at the annual convention of the International Association of Refrigerated Warehouses (IARW), World Food Logistics Organization (WFLO), and the International Refrigerated Transportation Association (IRTA), held this past April in Phoenix.

These three organizations, along with the International Association for Cold Storage Construction (IACSC) are the four "core partners" of the Alliance. All are managed by a group of association professionals based in Alexandria, VA.

Each offers unique value in a critical sector of the cold chain and across many international boundaries. Bill Hudson, president and CEO of the four Core Partner organizations, describes three critical trends facing the cold chain industry that drove the formation of the Alliance.

"First, we're seeing increasing integration in the business models of PRWs, from warehousing to logistics providers.

Refrigerated warehouses have invested in trucking assets and are entering arrangements and structures with customers," he says.

"Second, we see an evolving international business structure. As we did more work in emerging economies we saw that so often a single company would operate all aspects of the cold chain from food production to food delivery. In many countries, the third party provider is a developing concept.

"Third, we continue to work to reinforce the core competencies of the industry maintaining proper temperature and instilling best practices. It is important that we connect links from manufacturing, transportation, warehousing and logistics to retailing."

Hudson says the goals of the Global Cold Chain Alliance include:

  • Build relationships and networking for business and trade across the cold chain, delivering greater exposure, relationships and opportunities to members.
  • Integrate international cold chain organizations with which we are forming partnerships, thereby increasing communication and an exchange of information and expertise.

"The Alliance allows us to build a larger leadership role in our ever-changing food industry," Hudson adds. In addition to the Core Partners, he says the Alliance will include organizations that represent processing, cold storage, refrigerated transportation, retail, specific commodities, government, and educational institutions.

Royal Ahold To Spin Off U.S. Foodservice

Two investment firms have reached an agreement to acquire U.S. Foodservice, the second largest foodservice distributor in the U.S., from Royal Ahold N.V.

Clayton, Dubilier & Rice Inc. (CD&R) and Kohlberg Kravis Roberts & Co. L.P. (KKR), equal partners in the transaction, will acquire U.S. Foodservice for $7.1 billion.

With revenues in 2006 of more than $19 billion, U.S. Foodservice's operations cover a geographic area in which over 95 percent of the U.S. population resides. The company provides food and related products to independent restaurants, healthcare and hospitality customers, educational institutions and multi-unit restaurant companies.

"KKR has a long history of acquiring industry-leading franchises. U.S. Foodservice has built one of the leading businesses in the foodservice distribution industry, with a wide range of growth and operational improvement opportunities," says Michael M. Calbert, a member of KKR.

"We and our partners at CD&R look forward to working with the company's management team, which has done an excellent job of refocusing the business in recent years, to continue executing the strategic initiatives in place."

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