FLEMING NAMES PRESIDENT, SHUTS DEPOT

ELLIOT ZWIEBACH

OKLAHOMA CITY -- Fleming Cos. here has selected a new president and chief operating officer and completed its warehouse consolidation program -- two moves that signal the emergence of a tighter, leaner distribution company with a new perspective on wholesaling, observers said. The two announcements came within days of each other:

William Dowd, 52, will become Fleming's new president and chief operating officer, effective next Monday.

Fleming said last week it will close the former Scrivner distribution center in Columbus, Ohio, and transfer its volume to a facility in Massillon, Ohio -- a move that marks the end of a 10-warehouse consolidation program that began a year ago with the acquisition of Scrivner here.

Dowd has worked on the manufacturing side of the industry for 24 years, including positions at Cott Corp., Toronto; Kraft General Foods, Northfield, Ill., and the Mrs. Paul's Kitchens division of Campbell Soup Co., Chicago.

As president, he will succeed Robert E. Stauth, 50, who is giving up the title of president but will continue as Fleming chairman and chief executive officer. The post of chief operating officer had been vacant.

"Bill's assumption of these responsibilities and the creation of the chief operating officer function will allow me to focus attention on the strategic direction of the company, its growing retail operations and external communications," Stauth said.

Stauth said Dowd will spend six to eight months working with

him and Gerald Austin, Fleming's executive vice president of marketing, to learn the business and the intricacies of Fleming's re-engineering effort. "Then, as we complete implementation of re-engineering, Bill will help formulate strategic plans for the future and take part in budgeting for next year, and at the end of the first quarter of 1996 he will begin to fully assume leadership as president and chief operating officer," Stauth said. Austin, who has been directing Fleming's re-engineering plan, will retire at year's end, Stauth said, although he will work under a one-year consulting contract to help re-engineer human resources. Fleming is the nation's largest food distributor, with sales of $15.75 billion. It services customers in more than 10,000 stores, including 3,700 supermarkets, in 43 states and several foreign countries. It also operates 340 corporate-owned stores. The company over which Dowd will preside is a tighter, leaner one due to a series of consolidation moves under the re-engineering umbrella.

The 250,000-square-foot Columbus warehouse scheduled to close services approximately 80 retail customers in Ohio and Kentucky. Fleming said it will begin transferring that volume to the 780,000-square-foot Massillon facility on July 31, and it expects the consolidation to be completed by Sept. 1. The Massillon distribution center, located about 120 miles northeast of the Columbus warehouse, currently services approximately 200 customers in areas that overlap most of the Columbus facility's service area. Last year, prior to the Scrivner acquisition, Fleming closed four of its own facilities. Following the acquisition, it shut down five more warehouses last year (former Scrivner facilities in Donna and Victoria, Texas; Montgomery, Ala.; Blooming Prairie, Minn., and Syracuse, N.Y.).

The company also disclosed plans to close five other distribution centers this year (former Scrivner operations in Concordia, Kan.; Knoxville, Tenn., and now Columbus, plus two Fleming general merchandise operations in Dallas and Fort Worth, Texas).

Stauth said these consolidations are part of Fleming's ongoing strategy of moving to larger and more efficient distribution facilities.

According to Stauth, Dowd was hired to help Fleming develop a total supply chain management approach.

"The fact that we ultimately chose a manufacturer is a plus as we work on the value chain because we already have people at the senior level who came up through distribution and retailing but no one who came up on the supplier side," Stauth said.

"[Dowd's] expertise in applying advanced technology and the principles of [Efficient Consumer Response] will help us effectively manage our increasingly complex operations and control costs for our retailers."

Dowd told SN he agreed that his unique perspective will be a plus at Fleming. "Manufacturers tend to be good on the logistical and marketing sides of the business, and my experience in operations and marketing gives me a strong perspective on total management of the supply chain that few distributors have." Reflecting on Dowd's appointment, Gary Vineberg, a securities analyst with Merrill Lynch, New York, told SN, "One problem for the industry, particularly the larger wholesalers, is that they are inward-looking and often seem to be wearing blinders when it comes to recognizing changes in the retail marketplace. They need more outsiders at the top levels to provide a reality check." Gary Giblen, managing director of Smith Barney, New York, said, "Dowd's appointment comes at a particularly tough time for wholesalers, who can no longer make money on buying like they used to but must develop more efficient conduits for getting product to retailers. So it's become more urgent for them to develop partnerships with suppliers to survive, and this is a good example of that reality."