Food Lion 2011 Annual Report Download - page 21

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The rationale for the creation of
Delhaize America was to make
a more powerful organizational
structure by which the respective
banners could compete and real-
ize their individual strategic and
local objectives. “A common plat-
form and centers-of-excellence
allowing banners to focus on their go-to-market
strategies even more than before. The launch of
the Food Lion Brand repositioning and the Bot-
tom Dollar Food expansion have benefi ted from
the shared services and has allowed them to
focus on the customer,” explains Mark Doiron,
Head of Supply Chain Delhaize America.
In addition to enabling the banners go-to-
market strategies, the shared services structure
improves Delhaize America’s effectiveness and
effi ciency. Before the Delhaize America structure
was launched, the trucks for deliveries were
often not full. But thanks to grouping the entire
scope of the U.S. banners, more full truck loads
could be bought. Another example is the roll-
out of computer assisted ordering in all of the
1 650 stores. This will lead to lower out of stocks,
shrink and inventories across the group and,
ultimately, higher sales.
The new organization also reduces our procure-
ment cost of goods sold. We have established
common procurement teams that are able to
successfully leverage the full scale of Delhaize
America resulting in better terms with the ven-
dors and therefore providing the banners the
fl exibility to invest in price initiatives. The estab-
lishment of a network with a limited number of
suppliers and the roll out of category manage-
ment delivered even greater savings.
Delhaize Europe
Based on the positive experience at Delhaize
America and the increased size of our Euro-
pean operations, we decided in late 2011 to
create Delhaize Europe. As was the case for
Delhaize America, our philosophy is to main-
tain local focus when it comes to our customers
in the various markets we serve but to stand-
ardize what is not relevant or visible to the cus-
tomer. With that in mind, Delhaize Europe will
provide support in IT, fi nance, legal and human
resources for all the European operations. Del-
haize Europe will also help enhance procure-
ment effi ciency in the region with improvements
in cost of goods sold and increase in sharing
best practices.
Stéfan
Descheemaeker,
CEO Delhaize Europe
“Of course with
respect to Delhaize
Europe, we are talk-
ing about different
languages, different
cultures and in some
cases different cur-
rencies or regulatory
frameworks. But the
rationale is the same.
It is about identifying
areas or capabilities
that can be leveraged
across the Delhaize
Europe platform
while maintaining
or respecting those
elements that should
remain local. As was
the case with Delhaize
America, we will fi nd
the right balance. The
objective is to create
savings to fi nance our
continued growth.”
DELHAIZE GROUP ANNUAL REPORT ‘11 // 19