The Great Atlantic & Pacific Tea Co., Inc. And C&S Wholesale Grocers, Inc. Sign An Industry-Leading Agreement
Montvale, NJ - The Great Atlantic & Pacific Tea Co., Inc. and C&S Wholesale Grocers, Inc., recently announced the signing of a new ten-year agreement to combine their previously separate A&P and Pathmark supply agreements into one industry-leading partnership. This innovative agreement restructures the terms of their relationship aligning distribution operations, procurement practices and warehousing facility goals throughout A&P's retail banners.
The contract is a major change in the way A&P and C&S work together. With this agreement A&P and C&S will create increased efficiencies across A&P's distribution network, improve service levels to all stores, and enable both companies to achieve cost savings, which further contributes to the attainment of A&P's synergy targets.
The key aspects of this agreement are:
- An innovative new business model
- A dedicated network of distribution centers
- Coordination and collaboration of resources
- Reduction of on-hand inventory
- Improved in-stock levels
- Best-in-class service levels with improved speed-to-market delivery
- Cost reductions which will result in savings for customers
The new agreement aligns both companies' objectives and provides incentives to achieve mutual goals. Together, A&P and C&S expect to develop one of the lowest cost distribution systems in the Northeast grocery industry. Further, they plan to create a world-class distribution system to fulfill the merchandising needs of all of A&P's diverse store formats, providing customers with the best product selections.
As part of this new agreement the supply roles and responsibilities will be streamlined, creating clarity that will improve coordination and result in more productive procurement practices. This agreement will enable both A&P and C&S to implement warehouse efficiency controls to reduce costs and improve store service.
Eric Claus, President & CEO, The Great Atlantic & Pacific Tea Co., states "We are extremely pleased to arrive at this ground-breaking agreement. Our partnering with C&S and its high tech infrastructure combined with our new agreement creates the value that is only derived from a ‘big business model'. This leading-edge agreement will provide cost savings and efficiencies in warehousing while benefiting all parties including, most importantly, our customers."
Richard Cohen, Chairman & CEO, C&S Wholesale Grocers, Inc. further added, "C&S is excited to partner with A&P in an innovative relationship structure which could be the model for our industry. This agreement revolutionizes the way we do business with large retailers."
SOURCE: The Great Atlantic & Pacific Tea Co., Inc. and C&S Wholesale Grocers, Inc.