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ANNUAL MEETING

PORTLAND, Ore. -- Unified Western Grocers is on track to achieve the synergies it anticipates four months after being created in a merger of two cooperatives, Alfred A. Plamann, president and chief executive officer, told the company's annual meeting here last week.Unified, based in Los Angeles, was formed in October following the merger of United Grocers here with Certified Grocers of California,

PORTLAND, Ore. -- Unified Western Grocers is on track to achieve the synergies it anticipates four months after being created in a merger of two cooperatives, Alfred A. Plamann, president and chief executive officer, told the company's annual meeting here last week.

Unified, based in Los Angeles, was formed in October following the merger of United Grocers here with Certified Grocers of California, Los Angeles.

Although Plamann did not discuss specific personnel cutbacks during the meeting, it was clear from some of his remarks that the company's integration plans will reduce the number of employees at several locations.

Among the company's plans, according to Plamann, are:

Modifying severance, staffing and recruitment policies for the transition phase of Unified's corporate development.

Centralizing some procurement functions to leverage new purchase volume opportunities and develop new pricing strategies.

Consolidating three northern California distribution centers into one, with operations of a warehouse in Tracy moving to a facility in Stockton completed in January, and plans to transfer operations of a Modesto facility to Stockton in the next couple of weeks.

Consolidating the two companies' data centers into a single facility in Los Angeles, with the move expected "as soon as possible" and with a targeted completion date of next fall.

Accelerating the integration of operations to realize synergies at a faster pace.

Focusing on cost-cutting measures at all locations for immediate bottom-line results.

Consolidating financial reporting while maintaining separate accounting facilities here and in southern California.

Renegotiating terms with vendors using the company's expanded purchasing power.

Developing a common sell plan throughout Unified's three regions (southern California, northern California and Oregon), with implementation expected by next fall.

Examining all sales practices that do not incentivize members to purchase additional products from the company.

Besides enumerating some of the new company's goals, Plamann outlined some of its accomplishments during the past year, including the following:

The acquisition from Albertson's, Boise, Idaho, of 32 southern California stores, whose volume was approximately $475 million. Twenty-six of these stores have been sold to 15 member retailers; Plamann said Unified is operating the other six "until we can sell or otherwise dispose of them."

The purchase of SavMax Foods in northern California, which added $115 million in retail sales. "Since the stores have been under our control, they have experienced an increase in sales and operating cash flow," Plamann said. He said the company is keeping its options open regarding future ownership of SavMax.

The addition of more than 135 new customers, including approximately 75 in northern California, 50 in southern California and 10 in Oregon.

A Hispanic-focus initiative that included special deals and bulk-buying opportunities to generate sales increases for retailers with stores in Hispanic areas.

An initiative spotlighting general-merchandise products and merchandising displays, designed to help retailers make more informed purchase decisions.

A survey on consumer attitudes toward corporate brands, which pointed out areas in which the company could improve its position, including changes in label designs and packaging -- changes that will be rolled out to retailers later this year, Plamann said.

More successful buying shows. The company's Expo in southern California has become its most successful buying show ever, with sales up 54% to $79 million. Also, sales at the company's food show in Reno, Nevada, were up 20%.

A test of a new warehouse system to eliminate order mispicks and improve on-time delivery performance at store level.

Formation of a retail-technology consortium with other Western cooperative wholesalers, whose goal is to develop and use retail technology to better support member stores.

Beginning a rollout to all distribution centers of Teletrac, a satellite-communications system that links drivers and dispatchers. Using the system, the company was able to recover a stolen tractor trailer in minutes "and the savings from that single incident enabled us to recoup the costs of more than six months of expenses for the system," Plamann said.