Category Archives: Expansion

McLane Opens New Grocery Distribution Center in Ocala, Florida

(BRK.A), (BRK.B)

Berkshire Hathaway’s McLane Company, Inc., a leading supply chain services company providing grocery and foodservice supply chain solutions, formally announced it has opened a new grocery distribution center, McLane Ocala, in the Ocala International Commerce Center at 910 NW 50th Avenue in Ocala, Florida.

The 400,000 square foot facility will house 165,000 square feet of dry grocery, nearly 200,000 square feet of perishables and 35,000 square feet of office and support space. The first shipment arrived on February 4, 2019 and deliveries will begin on March 17, 2019.

The new distribution center will create over 400 new jobs in Marion County. By the end of the year, McLane Ocala plans to onboard 316 warehouse and support teammates and 120 drivers and transportation support teammates. Driver hiring began in October of 2018 in effort to allow drivers to become acclimated with McLane’s customers and the delivery process in general. The recruiting team held a three-day job fair in January at the facility and nearly 600 candidates were interviewed, resulting in 233 job offers.

This location will be McLane’s sixth distribution center in Florida, joining the grocery center in Kissimmee and four foodservice centers in Lakeland, Haines City and two in Orlando and will service the quickly-expanding customer base in the North Florida region. Construction Management Technology (CMT), the general contractor for the project, oversaw the renovations and development. The Ocala/Marion County Chamber and Economic Partnership (CEP), The County Commission and Ocala City Council were instrumental to the venture as well.

“We are thankful for McLane Company’s presence here in our community,” said Ocala Mayor Kent Guinn. “We are excited about their growth, their services and their community involvement.”

Michelle Chesnutt and Jerry Winterhalter are leading the operation with a combined 70 years of experience at McLane. Both teammates have held numerous positions within the company. Chesnutt recently transitioned from division president at McLane Dothan in Cottonwood, Alabama, while Winterhalter was vice president of distribution at McLane Sunwest in Goodyear, Arizona.

“We are thrilled to open our new facility in Ocala where the business community is welcoming and open to growth,” said Michelle Chesnutt, division president of McLane Ocala. “The values and work ethic of the prospective workforce is an ideal fit with McLane’s culture. McLane Ocala continues our company’s core initiative to drive customer results.”

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Thanks to Berkshire, Business is Booming at One of Its Newest Companies

(BRK.A), (BRK.B)

In the summer of 2017, Berkshire Hathaway made a little publicized acquisition when it acquired Warren, Michigan-based MRO distributor Production Tool Supply, and created a new wholesale division, Berkshire eSupply.

At the time, the company was ranked 34th on Industrial Distribution’s 2017 Big 50 List, but just the new Berkshire name has attracted a lot of new business.

“As soon as the new name was announced it was the best thing that ever happened to us,” John Beaudoin, president of Berkshire eSupply, says.

Such is the power of the Berkshire Hathaway name.

Now with Berkshire’s ability to finance capital expenditures to power growth, the company is in a major expansion phase.

With more than 1,000 suppliers, Berkshire eSupply has more than 1 million industrial/MROP products available online, dispersed from three strategically located distribution centers in Detroit, Los Angeles and Houston.

The company has already announced that 57 acres of currently vacant property in Novi, Michigan will be converted into a 193,230-square-foot warehouse with mezzanines and an 18,380-square-foot office building.

Also coming is a new facility that will open in Houston in four months, and another facility in California is in the planning stage.

The goal is to provide nationwide 1-2 day shipping of over one million SKUs for thousands of independent suppliers that have not had the money to provide the logistics and scope to compete with companies such as Grainger.

Berkshire eSupply gives independent distributors the custom website and logistics that make ordering seamless. The company provides retailers with a one-stop, private label, e-commerce platform.

“They already have the customer relationships, and we level the playing field in their competition with catalog suppliers such as Grainger,” John Beaudoin, president of Berkshire eSupply, says.

Just as importantly, retailers gain the punchout system that enables purchasing agents to buy from their website from within the buyer’s own procurement application or hosted eprocurement system. This opens major new customer opportunities.

With the cost of fulfillment centers being one of Berkshire eSupply’s major capital expenses, Beaudoin notes that there is huge potential for growth now that Berkshire is providing the financing.

“The entire MROP products market is around $360 billion,” Beaudoin notes. “Grainger has only $10 billion of it.”

It’s clear that Beaudoin has his eye on the other $350 billion of that business, and with Berkshire’s financing, he’s out to get it.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.