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INDUSTRY TRENDS

Smaller supermarket chains posted higher net profits and return on equity than their larger counterparts, according to the Food Marketing Institute's 2004 Annual Financial Review.

Researchers at Yale and Cornell universities concluded that slotting allowances support efficiency in the marketplace by optimally allocating scarce retail and warehouse space to the most successful products, balancing the risk of new product failure between manufacturers and retailers and widening retail distribution opportunities for manufacturers.

Campbell Soup, Coca-Cola, and Coors are among the firms that have joined forces to review supply chain best practices and metrics in the consumer goods industry. They are working with Tompkins Associates and The Soleus Group to gather their data, which will be available later this year.

The Frozen Food Foundation is launching a large educational initiative aimed at spreading the message: "Zero Degrees Fahrenheit: Nothing Tastes Better," highlighting the need to maintain proper temperatures throughout the frozen food supply chain.

The global food retail market is estimated at $3.5 trillion and will increase to $6.35 trillion by 2020, according to a report from IGD. The report predicts that, the United States will account for 19 percent of the entire global market, down from the 22 percent it occupied in 2003.

DIVESTITURES

As part of a $250 million, two-year cost-cutting program, Albertsons Inc., Boise, ID, plans to reduce administrative expenses, do more chain-wide purchasing and merge three northern California distribution centers into two.

Loblaw Cos., Toronto, will close six warehouses in Ontario and Quebec over the next three years as part of an effort to streamline operations.

LEGAL MATTERS

Winn-Dixie Stores Inc., Jacksonville, FL, filed for bankruptcy Feb. 22. All 920 Winn-Dixie stores in eight U.S. states and the Bahamas will remain open, but the store chain is looking at some asset rationalization and lease reductions as part of its reorganization.

A new country-of-origin labeling law for fish and shellfish took effect April 4, requiring retailers to let consumers know the origins of such products and whether they were raised on a farm or caught in the wild.

3PL BRIEFS

Chef Solutions honored Lanter Distributing, a division of Ozburn-Hessey Logistics, Nashville, TN, as its LTL/Pool Carrier of the Year.

C.H. Robinson Worldwide, Minneapolis, acquired produce marketing and sourcing companies Food Source Inc., Food Source Procurement LLC and Epic Roots Inc., all based in Monterey, CA.

Hub Group, Inc., Downers Grove, IL, changed the name of its logistics unit from Hub Logistics to Unyson Logistics.

Kimberly-Clark Health Care named a USF Logistics facility in Ontario, CA, as its Warehouse of the Year. It is the second year in a row that the 3PL has won the award.

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To accommodate its new W. Newell & Co. specialty produce distribution company, Supervalu Inc., Minneapolis, is building a state-of-the-art regional produce distribution center in Champaign, IL. The $25 million, 155,000-square-foot warehouse is due to open in August and will consolidate the produce volume currently located in other Supervalu regional distribution centers serving retailers in Illinois, Indiana, Iowa, Kentucky, Michigan, Missouri, Ohio and Wisconsin. It will also double as the company's corporate headquarters...Wakefern Food Corp., Elizabeth, NJ, is building a 1 million-square-foot distribution center in Upper Macungie Township, PA. Due to open this summer, it will supply ShopRite supermarkets in New Jersey, Pennsylvania and Delaware.

futureforecast

Instead of constructing traditional warehouses at its shelling plant, Tifton Quality Peanuts, Tifton, GA, is erecting three airtight domes filled with nitrogen to better preserve freshness. Measuring 85 feet high and 170 feet in diameter, the domes will each hold about 11,000 tons of peanuts that are loaded from the top by an elevator. They'll be taken out through a hatch in the floor. From there, they will travel to the shelling plant and then out to loading docks for shipment by rail or truck. The first dome opened in mid-February and the others are expected to be completed by the summer.

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