Supply Scan

News and Trends From Across the Food Supply Chain

Supervalu Inc.’s board of directors has appointed Craig Herkert, 49, of Wal-Mart, to the position of chief executive officer.

Jeff Noddle, 62, who has served as chief executive officer since 2001 and chairman of the board since 2002, will continue to serve as the company’s executive chairman and will work closely with Herkert over the upcoming months to ensure a smooth transition of senior management.

Herkert’s official start date has not yet been determined.

“As we approach the end of year three of our company’s transformation and as I begin planning for retirement, the time is right to lay the groundwork for continuity of leadership through the next phase of our journey,” says Noddle.

“Herkert is a talented executive with extensive experience in food retailing and supply chain management. As an integral part of Wal-Mart’s senior leadership team, he has demonstrated an ability to create shareholder value and achieve business results,” says Noddle.

“I look forward to working closely with Craig in the coming months to ensure a seamless transition as we, and other members of the Supervalu team, continue to focus on our company’s future growth and success,” he adds.

With more than 30 years of retail experience, Herkert comes to Supervalu from Wal-Mart where he has served as president and chief executive officer of the Americas since 2004. In that role, Herkert was responsible for a $52 billion business that encompassed a variety of diverse formats across Canada, Mexico, and Central and South America.

From 2000 to 2003, Herkert served as senior vice president and chief operating officer of Wal-Mart International, responsible for international merchandising, marketing and operations.

Prior to joining Wal-Mart, Herkert spent 23 years with the American Stores and Albertsons companies. At the time of his departure from Albertsons in 2000, he was executive vice president of marketing.

Schoep’s Ice Cream has selected the HighJump mobile sales and delivery applications to provide improved customer service while controlling costs.

The Madison, WI-based ice cream manufacturer and distributor—with both local and national distribution operations—will implement HighJump Route Administrator, HighJump Route Assistant and Usable GPS, products new to HighJump offering of solutions through the acquisition of BelTek Systems Design.

The software will support the delivery of Schoep’s Ice Cream products via 21 pre-sell and delivery routes throughout the Midwest.

The HighJump system will create efficiencies across the company’s operations. Route drivers will transmit orders in real-time and have access to up-to-the-minute inventory counts, enabling more efficient scheduling of warehouse workers and improved customer service levels. Additionally, the system will allow drivers to scan items instead of entering information manually and provide real-time tracking of driver location and automated order processing, leading to labor efficiencies and cost savings.

“In today’s challenging economic environment, we needed to create new efficiencies in our operations, to essentially do more with less. With the HighJump solutions, we will be poised to grow our business as the market evolves,” says Jeremy Raether, systems manager, Schoep’s Ice Cream.

“Additionally, Usable GPS will take the real-time data environment to the next level, providing us with insight into what is going on in the field as it happens, enabling us to improve our customer service in a very competitive environment.”

According to the U.S. Department of Energy, the industrial sector has long been the country’s largest energy user, currently representing more than one-third of the country’s total energy consumption.

Dennis Sadlowski, president and CEO of Siemens Energy & Automation Inc., the U.S. industrial arm of Germany-based Siemens AG, recommends the following tips for distribution center operators to reduce their carbon footprint and start saving:

1. Do your homework. First and foremost, you will not know how much you can save, until you know where the money is being spent. An energy audit will help you better understand your energy usage and determine where your facility can go green and save money.

2. Rethink your lighting. By simply replacing your lighting with energy efficient products and controls, you can reduce energy consumption up to 50 percent as well as eliminate the risk of mercury contaminants in a very short period of time.

3. Evaluate your motors and drives. Electric motors are responsible for almost 70 percent of all energy consumed in industrial applications. This 70 percent holds a considerable saving potential that is just waiting to be realized.

So why not start now by replace existing motors with energy efficient motors? Or save even more by adding variable frequency drive systems to the motors. In some cases, drives can contribute a 30 percent energy savings with a seven month return on investment.

4. Control heating and cooling costs. As much as 30 percent of the energy used in your facility comes from heating and cooling costs. Making smart decisions about your facility’s heating, ventilating and air conditioning (HVAC) system can have a significant impact on your utility bills.

5. Monitor the situation. By knowing and understanding their plants’ electrical footprint and monitoring energy use, companies can track their progress toward efficiency goals as well as establish benchmarks for achievement.

Wal-Mart Canada will invest $115 million to build a state-of-art distribution center in Balzac, Alberta. Among the largest refrigerated buildings in Canada, the DC will be 400,000-square-feet in size and serve as a distribution hub for fresh food destined for Wal-Mart stores in Western Canada.

This will support the expansion of Wal-Mart’s modern supercenter format, which adds a complete range of groceries to its traditional general merchandise selection, as well as its commitment to being a leader on environmental sustainability.

“Even in tough times, we continue to invest in our communities and in our business,” says Andy Ellis, senior vice president, supply and logistics, Wal-Mart Canada. “This distribution center provides us a state-of-the-art facility, custom made to deliver the freshest products available for our Wal-Mart customers all across the West.”

Wal-Mart Canada has invested $220 million in the past year to modernize and expand its distribution network. The network supplies 312 stores nationwide from eight distribution facilities: four sites in Calgary, Alberta, including Balzac; one site in Cornwall, Ontario; and three sites in Mississauga, including a newly opened 450,000-square-foot, refrigerated center that will be the model for the Balzac location. Wal-Mart Canada’s nationwide distribution activities employ more than 3,200 Canadians.

The DC will open in late 2010 and will be operated by Canadian logistics firm Centric Retail Logistics.

The facility will be built and operated with rigid environmental standards, including:

  • Environmentally preferable construction materials and building equipment: concrete floors instead of chemical intensive tiling in all office areas; concrete supplemented with fly ash instead of cement; substantial roof and wall insulation; environmentally preferable paint finishes.
  • Temperature control: A white roof to reflect sunlight and reduce cooling needs; high-efficiency motors, variable speed fans, cooling equipment, air doors between different temperature zones to minimize heat transfer; demand-response systems to reduce peak-load energy draw; and renewable energy sources to minimize electrical consumption.
  • Responsible refrigeration: High-density storage to minimize heat loss; natural refrigerants to avoid ozone depletion and global warming; biodegradable refrigerants.
  • Operations that reduce waste and energy use: Motion-detecting LED lighting; electric forklifts; recycling of all varieties of shipping materials; salvaging food waste; automated shrink wrapping machines to minimize waste; chemical free water treatment of process water to allow grey waste water to be used for site irrigation.


» Mexican Bakery Buys First Hybrid Truck In Mexico
Grupo Bimbo, a Mexican bakery company, took delivery of the first medium duty hybrid truck in Mexico, a Kenworth T270.

The diesel-electric hybrid truck reduces fuel consumption by 30 percent, carbon dioxide emissions by 40 percent and carbon monoxide by 90 percent. The hybrid is equipped with a PACCAR PX-6 engine.

The vehicle also features an Eaton diesel-electric hybrid power system that integrates an electric engine with 60 hp, enough to start moving the unit without using the diesel engine.

Furthermore, it assists the diesel engine when more torque and power is required by the unit for acceleration. The engine works with a 340-volt battery that recharges every time the unit brakes to reduce speed.

This unit is part of the delivery fleet within the Mexico City metropolitan area which, by the way, has the highest traffic and is the most polluted area in the city.

This is the first delivery of various hybrid trucks that Kenworth is planning to release this year. The next step is to manufacture hybrid vehicles in PACCAR Mexico’s plant in Mexicali.

» Martin-Brower Joins EPA SmartWay Partnership
The Martin-Brower Co. LLC. has joined the SmartWay Transport Partnership, a collaboration between the U.S. Environmental Protection Agency (EPA) and the freight industry designed to increase energy efficiency while significantly reducing greenhouse gases and air pollution.

The Rosemont, IL-based company is committed to contributing to the Partnership’s goal to reduce 33 to 66 million metric tons of carbon dioxide and up to 200,000 tons of nitrogen oxide per year by 2012 by improving the environmental performance of its freight operations.

Martin-Brower has made changes across its operations to help reduce its impact on the environment, including using alternate fuel sources such as AME bio-diesel, sulfur-free and blended diesel, piloting new hybrid tractors that burn both bio-diesel and conventional fuel and using the latest dynamic route optimization technology to consolidate deliveries as well as utilizing more extended-length trailers.

In fact, while the company continued to grow in 2008 its use of fuel was reduced through these comprehensive green efforts, resulting in a 3 percent reduction in fuel consumption—or 73,000 gallons less used in 2008 vs. 2007.

“At Martin-Brower, our commitment to achieving unmatched value for our customers is matched only by our passion to enrich our community through good corporate citizenship. We have never been a company to waste anything and have always aimed to work in an efficient manner. Joining the SmartWay Transport Partnership is a natural evolution of our commitment to innovation and sustainable practices,” says Greg Nickele, Martin-Brower president and CEO.