CHARLOTTE, N.C. — Snyder’s-Lance, Inc. said it plans to convert its company-owned direct-store delivery (D.S.D.) routes to an independent operator (I.O.) structure over the next 12 to 18 months. The transition is expected to occur on a “market-by-market basis” and will create “an integrated coast-to-coast distribution network that is better positioned to serve customers with industry leading products such as Snyder’s of Hanover brand pretzels, Lance brand sandwich crackers, and Cape Cod brand potato chips among many others,” the company said. Currently, approximately 45% of the routes are company-owned routes and 55% are independent operator based routes in the Snyder’s-Lance network.
“Migrating to a single model of distribution is a critical component of our merger integration,” said David Singer, chief executive officer. “After much diligence, we have concluded that an independent operator based system is the most practical and efficient sales distribution system for Snyder’s-Lance. This approach positions us to strengthen our sales relationships with our customers, which will result in accelerated growth. Consolidating our distribution networks and migrating to an independent operator system is expected to also drive improved returns, as the I.O. approach is less capital intensive than a company owned system.”
Carl E. Lee Jr., president and chief operating officer, added, “We are confident we will engineer a very successful transition over the next 12 to 18 months based on the success we have had over the past several years with similar conversions. While this is a significant conversion, it has been well received by our route employees, and we expect that it will be a positive for our customers as well. The new system is expected to support even better service levels for customers and provide greater opportunities for the independent route operators through larger drop sizes given the combined volume resulting from the merger.”