Supply Scan

News and trends from across the food supply chain.


Core-Mark To Acquire Klein Candy For $65M

Core-Mark Holding Co. Inc., one of the largest North American distributors to the convenience retail industry, has signed a definitive agreement to acquire substantially all of the assets of Klein Candy Co. for approximately $65 million dollars.

Core-Mark, based in San Francisco, will incorporate the Klein operations into its existing distribution network, creating a national distribution capacity. Klein and Core-Mark say they are committed to continuing to provide great service to Klein Candy's customer base. The deal is expected to close later this month.

"We are pleased to have this definitive agreement signed and be well on our way to the close of this very exciting next step in Core-Mark's evolution," says Michael Walsh, CEO of Core-Mark. "We believe this is a critical step in providing national service as part of our quest to be the leading distributor to the convenience industry in North America."

"We are thrilled to join Core-Mark, with its tradition of customer service dedication, and believe the joining of forces with Core-Mark will serve the Klein customers very well," says Steven Dressler, CEO of Klein Candy Co.

Core-Mark is a broad-line, full-service convenioence store and foodservice wholesaler serving 20,000 retail locations in 38 states and five Canadian provinces through 24 distribution centers, two of which it operates as a third-party logistics provider.

Klein Candy Co., trading as Klein Wholesale Distributors, is a convenience store distributor and currently stamps cigarettes, provides full service and delivers products to nine states, including Pennsylvania, Michigan, New York, New Jersey, Connecticut, Maryland, Delaware, Washington and Virginia.

Study Finds RFID Reduces Out-Of-Stocks In Fast Movers

RFID has the greatest impact on products that sell between seven and 15 units per day—according to further analysis by University of Arkansas researchers on the impact of RFID on out-of-stock (OOS) products at select Wal-Mart stores.

"This is a very important category," says Bill Hardgrave, founder and director of the RFID Research Center in the Sam M. Walton College of Business in Fayetteville, AR. "These items are fast movers and would be expected to stock out frequently. But they probably do not disappear from shelves frequently enough to demand close attention from store associates who are responsible for their replenishment."

In May, Hardgrave announced that RFID was responsible for a 30 percent reduction in out of stocks for products selling on average between 0.1 and 15 units per day. Deeper analysis demonstrates that RFID was responsible for a 62-percent reduction of out of stocks for products that sold between seven and 15 units per day.

For those rare products that sell more than 15 units per day, Hardgrave did not detect a reduction in out-of-stocks due to RFID technology. His findings for this category were inconclusive.

The study, sponsored by Wal-Mart Stores and conducted from Feb. 14, 2005, to Sept. 12, 2005, examined 24 stores, half of which were RFID-enabled and the other half of which were control stores. The stores involved werelocated in Texas and southern Oklahoma. Tests included 4,554 products and were controlled for things such as pack size of cases and shelf quantity.

For stores that were not RFID enabled, associates had to create manual lists of items that needed to be taken from the backroom to the sales floor. Although handheld scanners helped associates, the lists were based on human observation of shelves for items that were out of stock or soon to be out of stock.

For test stores, lists were created automatically based on RFID-generated knowledge of item location within a store backroom or sales floor and point-of-sale data.

Further breakdown based on sales velocity demonstrated that RFID reduced OOS:

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