AC HUMKO SHIFTS TO CHEP PALLET SYSTEM

MEMPHIS, Tenn. -- AC Humko, a manufacturer of private-label vegetable oils, shortening and nondairy creamers based here, has begun using Chep's pallet pooling system.

ers, club stores and other participating retail customers.

"We found that more than 90% of our customers wanted delivery on Chep, so we made the move immediately," said Dan Antonelli, president and chief executive officer of AC Humko. "We believe it will ultimately remove costs from the entire distribution channel."

AC Humko, formerly the Specialty Oil Division of Kraft Food Ingredients, had previously used a "captive pallet" system, which caused inefficient double handling, the company said. Under that system, its products were loaded onto one pallet at the point of production, then transloaded to a second pallet for exchange at the point of dispatch.

Chep's program elminates this double handling by moving product all the way to the customer's warehouse on the same pallet. The projected savings of the transition were so great, that AC Humko made the switch without prior testing.

"We have long held the belief that there is value in launching the Chep system for all levels of grocery manufacturing," said Cliff Otto, senior vice president for Chep USA-Midwest. Initial results from the AC Humko launch show that "benefits are achieved very quickly," he added.

Chep USA announced separately that it would relocate its headquarters to Orlando, Fla., effective in June. A total of 82 high-wage jobs will be created there. The state and city have promised the company tax incentives worth $459,000 over the next four years.

Chep is a national pallet rental company with 169 depots located throughout the United States. Its pallets are dispatched from 2,600 manufacturing shipping locations to more than 5,900 distributor receiving locations nationally.