ARLINGTON, VA. — Nestle USA announced plans to exit its company-owned frozen direct-store delivery network for pizza and ice cream and transition to the warehouse model it uses for its frozen meals and snacks businesses. The phased transition will begin in the third quarter of 2019 and is expected to be completed early in the second quarter of 2020.
The company said the move will result in the closure of eight company-owned frozen distribution centers and frozen inventory transfer points.
Nestle’s frozen pizza brands include California Pizza Kitchen, DiGiorno, Jack’s and Tombstone. The company’s ice cream brands include Edy’s/Dreyer’s, Drumstick, Skinny Cow and Häagen-Dazs.
“Ice cream and pizza are growing categories in which we hold strong leadership positions,” said Steve Presley, chairman and chief executive officer of Nestle USA. “As we continue to focus on driving long-term profitable growth, leveraging a simpler route to market unlocks resources we can use to fuel our efforts in demand generation, such as product innovation and brand building.”
The move is part of Nestle’s broader efforts to transform its organization and accelerate growth in a rapidly changing retail environment.
“Moving to a warehouse model has numerous benefits for us and our retail customers,” Mr. Presley said. “By taking advantage of the unmatched breadth and depth of our existing frozen warehouse network, our retail customer partners can better leverage their existing networks. This change is a win-win for Nestle and our customers.”