Shared Resources
Shared Efficiencies
Behind the scenes, the four companies of the new Fred Meyer share a
powerful network of modern distribution centers, warehouses,
manufacturing facilities, and management information systems. These
and other benefits of the mergers should deliver up to $150 million in
savings for Fred Meyer, Inc. by the end of 2000. Here are just a few
of the examples of how Fred Meyer companies are joining
forces to gain competitive advantages and cost efficiencies.
Win-Win Distribution Solutions
The state-of-the art distribution and
manufacturing centers for Smith's
in Layton, Utah, had unused capacity-
and the perfect location for
serving Fred Meyer stores in Utah and
Southern Idaho. Taking advantage
existing resources, Fred Meyer now
purchases dairy products for nearby
stores from Smith's Layton creamery,
and uses the Layton distribution
center to supply groceries, frozen
food, and health and beauty aids.
This win-win distribution solu-tion
resulted in immediate
savings for Fred Meyer Stores,
added jobs and increased productivity
for Smith's, and paved the
way for similar gains by QFC and
Ralphs. By the middle of 1998,
QFC stores will receive many prod-ucts
from Fred Meyer's distribution
center in Puyallup, Washington.
The companies also will share
Fred Meyer's dairy and bakery in
Portland and QFC's central kitchen
in Seattle. Meanwhile, Ralphs is using
the extra capacity of its Southern
California distribution centers
and manufacturing plants to serve
Hughes Family Markets, enabling
Fred Meyer to sell the Hughes'
distribution center.
Modern MIS
In 1997 Fred Meyer Stores finalized
its conversion to a fully-integrated,
IBM-based management information
system (MIS).The new network
integrates virtually every retail function,
including merchandising,
distribution, sales, accounting, and
payroll.The system provides extensive
point-of-sale data that, combined
with streamlined distribution centers,
will enable Fred Meyer Stores to
improve sales and inventory turns,
reduce mark-downs,and decrease the
need for working capital.
By the end of 1998, Fred Meyer will
support MIS operations for Smith's
Food & Drug Centers, with QFC
stores to follow in 1999. Ralphs,
which also uses a state-of-the-art system,
is in the process of converting
Hughes stores to the Ralphs system.
With all companies on compatible
information systems, Fred Meyer, Inc.
expects to realize even greater opportunities-
serving customers more
responsively, operating more efficiently,
and sharing information
across the corporation.
Merchandising Power
In Smith's markets, work is
underway to convert 18 Smitty's
stores into Smitty's Marketplaces,
among the first multi-depart-ment
stores in the region. To
gain a competitive edge, Smitty's
is tapping the expertise of Fred
Meyer Stores, adding some
50,000 new products in a variety
of food and nonfood categories.
Combining buying clout with
merchandising synergies, Fred
Meyer buyers now place orders
in many nonfood categories for
Fred Meyer Stores and the grow-ing
Smitty's Marketplace chain.
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