ORLANDO, Fla. -- "We are now in the business of distributing solutions -- solutions to whatever logistics problems the manufacturer and retailer may encounter in their quest to meet their own goals and objectives," said Robert Sigel, president and chief operating officer of Millbrook Distribution Services, Leicester, Mass. That's how Sigel described his re-engineered company here during his keynote address at Millbrook's first annual convention and expo. The event featured nearly 300 exhibits and attracted 1,000 attendees, including executives from 100 supermarket companies. In January 1994 the parent company, McKesson Corp., consolidated its two service merchandising companies into one. "The change in our name to 'Distribution Services' signifies an important change," he said. "We are no longer service merchandisers. We have expanded our view of ourselves to that of a provider of a variety of services designed to solve the specific needs of our retail customer."
He said those new services vary from "having product produced in less than case quantities, delivered to each store, physically price marked and stocked on the shelf, to processing product without tickets in full cases that is backhauled from our distribution center."
One division of the new company trains retail customers to do merchandising services, and another division offers retail services to brand marketers. "The industry has consolidated at all levels," said Sigel. "There are fewer manufacturers, wholesalers and retailers. There is no reason to believe that given the current upheaval in the marketplace that this trend will not continue." Millbrook's re-engineering, he said, was a reaction to these changes in the marketplace. "We are on the verge of a new era, one in which technology will allow us to quickly analyze the real costs of the activities that are performed in the distribution process," he said. Millbrook will be using activity-based costing techniques to help achieve its goal of being the low-cost producer, he said.