Kellogg's has went down hill with bad hires in management. They don't belive in relationships at store level. They now push spark selling which is one sided profit for them. And now they have excellence in selling. Good luck
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Maybe, but here's how they get around it. A wholesaler has their own option of DSD as long as Kelloggs is not compensating them for it. If a wholesaler decides to fully market their products its at their own expense. There's no breach as Kelloggs has no control of how a wholesaler markets as long as the terms they are paying are like every other wholesaler. There actually is 1 in northeast right now that will order, deliver & pack it out for a higher price on products. Most stores balk at this. But you know as well as I do Kelloggs can find a backdoor incentive for these "DSD" wholesalers to help offset the additional cost of full marketing and keep the price competitive. I have no proof other than possible news next week on this. I thought it was 1 year, but if what you say is true & nothing new next week, then maybe its a wait for another year and this discussion becomes moot.
Any party 2nd 3rd whatever that distributes and delivers to any individual grocery store chain (grocery chains that were delivered to buy Union Distribution Center which was like 36 DCs)as DSD is a breach of the negotiations settled between Kellogg and the Teamster Union during the agreement of severance. In the agreement Kellogg will have to call back union workers if Kellogg decides to go back to DSD Within 2 years after the closures. I'm sure this is just your opinion and not based on any facts.we kept the layoffs out of the public eye because it was part of the negotiations that we could not bad-mouth accompany or we would not get a severance or we could be sued. If Kellogg did go back to a any kind of DSD you better believe they will have the media this time cuz they breached the agreement.if they do it's a huge class action suit against them. So long story short they aren't going back DSD in any way it's going to stay the same model that there doing now.
2nd party vendor is my term. Kelloggs will deliver direct to independent warehouses who in turn will distribute product as a DSD. No distro centers. These "warehouses" will be responsible for marketing, distribution & packing out for certain chains and independents in certain areas that desire DSD and those wanting an option. The pricing is the sticking point here as it will create a competitive market with straight wholesalers who choose not to DSD. As you probably know competition within the same product lines can stimulate wholesale sales, in turn retail sales. You still haven't given me a reason for Kelloggs not doing this.
12k-15k loss of jobs????
I think th at # is way to high. Do the math. How many were full time? 39 DC's and full time sales force would be nowhere that #.
That is the opinion of a former employee with 35+ full time years with the Keebler/Kelloggs company. The math does not add up.
Even if there were 10,000 part-time merchandisers(which they're were not),your numbers are way off.
so who is a second party vendor?
It is a factor with Kelloggs. The aggressive approach of , in this case 2nd party vendors is key in promoting new items and acquisitions as well. Its been proved already. No it doesn't replace the 15,000, but its a sure cheap & effective way to get sales up in down areas where DSD was removed and regaining shelf space lost to Nabisco & others this past year. Kraft runs a similar program. A 2 tier system consisting of direct and a DSD according to geographic areas. Nabisco is headed in that direction. Can you think of a reason why Kelloggs wouldn't do it?
I see what you’re saying and would say that’s an opportunity. Does it replace 15,000 jobs, no, it’s simiply using third party where we most like aren’t covering the stores anyway. Independents see the value in increased cost to save them the overhead. Not a huge factor to Kellogg’s but I can see how it’s a huge opportunity for, perhaps, a wholesaler like yourself?
let's be honest , ChinaMart doesn't care about growing business, they only care about controlling their business. don't get the 2 confused
Your confusing big box retailers with everyone else. Congested urban areas consists of small local chains & independents. They want DSD. They do not want their employees doing orders & packing out. The last thing they want to do is hire anyone. The warehouses in these areas are ,not thrilled with Keebler as well. Too many items taking up too much space. They constantly short retailers 30-40% of skews ordered. This brainstorm transformation actually came from Walmart. As long as big boxes get what they want, Kelloggs free to resume DSD to anyone that wants it. Wait for news next week concerning this.
So you’re saying that Kellogg went through orchestrating one of the largest transformations with retailers ever to then turn around and pull the product out of their warehouses and move to 3rd party? Not sure I follow why they would do that? The retailers want the margin benefits not a middle man.
Teamsters have recall rights for another full year.
Your tune will change after the Aug. 28-30 meeting in which they will re-start DSD without the 15,000 & their salaries. Direct delivery to 3rd parties instead of warehouses. They are in the market for acquisitions as well and this is how they will push the new items. No one does it better than 3rd parties with an incentive. They know DSD is needed in certain market areas where warehousing does not work. When it is all said and done they will look like geniuses & nabisco & others will follow.
Thats what i told everyone feb 2017,get rid of 15,000 employees,39 d.c. centers,sell everything.and third party whats left.No they wont have the store coverage,no they wont have the personnel pushing their product,but the numbers will look good for a little while.
But they are making bank $$$ laying off 12k employees in one fell swoop. No bad PR either. Jiminy crickets if AMAZON laid off 1k employees the country would have a Sh-- Fit. 12k ppl laid off times roughly $40k salary equals savings of $480,000,000 not including benefit costs. So well over a half a billion dollars in savings. It's gonna take a long time for the loss in sales to cross paths with layoff savings.