Ahold Delhaize USA is partnering with cold storage provider Americold to build two automated frozen warehouses to serve its supermarkets in the Northeast and Mid-Atlantic regions.
Ahold said Thursday the new cold-storage facilities will be in Plainville, Conn., and Mountville, Pa. The Plainville warehouse will serve Stop & Shop and Hannaford stores in the Northeast and New England, while the Mountville warehouse will serve the Giant Food, The Giant Company and Food Lion chains in the Mid-Atlantic.
Plans call for the new facilities to go into operation by the fourth quarter of 2022, according to Ahold. The company said the projects will expand cold storage space by 24 million cubic feet, or 500,000 square feet, and provide local product expansion, better product freshness and faster delivery because of their proximity to its local supermarket brands.
“We’re extremely proud of this new partnership with Americold and the opportunity to fully expand our cold storage capacity as part of our current storage needs and future growth plans,” Chris Lewis, executive vice president of supply chain at Retail Business Services (RBS), Ahold Delhaize USA’s services arm, said in a statement. “Americold is a leading expert in this space, and we’re confident in their abilities to build state-of-the-art facilities that will meet our needs and serve our omnichannel growth strategy.”
In December, Ahold unveiled a three-year, $480 million plan to shift its supply chain to an integrated, self-distribution model. The initiative includes the construction of the two new frozen warehouses plus the acquisition of three warehouses (two in York, Pa., and one in Chester, N.Y.) from C&S Wholesale Grocers and new leases for a recently renovated warehouse in Manchester, Conn., and a C&S facility in Bethlehem, Pa. Keene, N.H.-based C&S has supplied some Ahold Delhaize USA brands.
The two facilities will bring more automation and advancements such as an integrated transportation management system and end-to-end forecasting and replenishment technology.
Quincy, Mass.-based Ahold said the new frozen storage facilities will bring more automation and advancements such as an integrated transportation management system and end-to-end forecasting and replenishment technology, which will support omnichannel operations and multichannel growth. The two warehouses will create about 200 new jobs apiece.
“We are thrilled to partner with Ahold Delhaize USA to design, build and operate these strategically located retail distribution fulfillment centers over an initial term of the next 20 years,” stated Fred Boehler, president and CEO of Atlanta-based Americold. “With state-of-the-art automation, these two facilities will deliver a combined 59,000 pallet positions to support the local brands of Ahold Delhaize USA in the Northeast and Mid-Atlantic regions.”
Ahold said its distribution network will expand to 23 facilities by 2023. The network now includes 16 traditional and e-commerce distribution centers, which supply 1,971 stores across the East Coast as well as fulfill more than 6 million annualized online grocery orders. The company’s supply-chain operations also include over 1,000 trucks that travel more than 120 million miles each year and deliver 1.1 billion cases to stores.
With the expanded distribution network, Ahold’s U.S. grocery brands will have coverage from Maine to Georgia, the retailer said.
“Today’s announcement continues to reinforce how Ahold Delhaize USA is transforming our infrastructure to support the next generation of grocery retail,” Lewis added. “Through this expansion, we will continue to modernize our supply chain distribution, transportation and procurement through a fully integrated, self-distribution model that will be managed by our companies directly and locally. This will result in efficiencies and, most importantly, product availability and freshness for customers of our local brands — now and in the future — whenever, wherever and however they choose to shop.”
