GREEN BAY, Wis. -- Good Humor-Breyers Ice Cream here has completed phasing out its direct-store delivery distribution system, which had delivered Breyers and Sealtest ice creams direct to supermarkets.
"The shutdown is complete," said Max Ballard, senior vice president of sales for Good Humor-Breyers, referring to the DSD operation. He told SN the system primarily serviced supermarkets in Southeastern states.
In interviews with SN, the vendor and a number of retailers said the transition went smoothly, though not all retailers had wanted to drop the DSD system.
The move to change the delivery system began Oct. 25, when Unilever United States, Good Humor-Breyers' parent company, purchased the ice cream interests of Philip Morris' Kraft General Foods. DSD was eliminated as part of the consolidation of the two operations.
"The response from retailers has been extremely positive," Ballard told SN. "They like to control their own destiny, so to speak. A lot of them have their own warehouses and wanted to get away from DSD.
"Our philosophy is to do business the way our customers want," Ballard said. "That's the reason we closed the DSD system. Essentially, we had been dictating how our customers would receive their ice cream."
Some retail customers, both large and small, have opted to continue DSD distribution, however, through local third-party distributors. "If a customer wants DSD, there are lots of distributors around who do DSD," Ballard said.
Others said they welcomed the change to warehouse delivery. "We had more problems when [Good Humor-Breyers] went from warehouses to DSD about two years ago, than when they went back to warehousing now," said J. Thomas Outlaw Jr., director of frozen foods for Ingles Markets, Black Mountain, N.C.
Ingles had prepared for this latest change by adjusting its buying. "We bought out on DSD, to make sure we were covered in January. We took on more product on store level than we like, but we wanted to make sure we didn't run out," Outlaw said. He added that, now the transition is complete, things are running smoothly.
"I think it will help sales because we'll be able to make sure we have what we need in the stores," he said.
A buyer with a large Southern retailer told SN he elected to stay with DSD. "We do it now through a wholesaler who does other frozens for us. It's worked out fine. The biggest problem was getting the changes in our computer."
Some retailers have profited by the move away from DSD, Ballard said.
"It depends on the cost structure of their warehouse operations," he explained. "They certainly get the product much cheaper. Whether it's cheaper than the cost of servicing their stores, that's something unique to each retailer. Generally, customers who have large ice cream programs can improve their margins by putting the ice cream through the warehouse."