The Friday Report: November 19, 2021

Quick wrap up of a few hot topic newsworthy stories in the supply chain logistics industry

Chlorox Ramps up Use of Contract Manufacturers 

To avoid the impact of raw material shortages, Chlorox has escalated its use of contract manufacturers from 20% to nearly 50% of shipments.  Although it does not intend to rely on third party suppliers and manufacturers for the long term, Chlorox anticipates that using third party manufacturers will enable the company to keep pace with the high demand for its products. 

During 2020, Chlorox faced months of stock outs and frustrated consumers.  Although it increased manufacturing on specific production lines and facilities, more suppliers were needed to meet the demand.  By diversifying its supplier base, Chlorox will be better positioned with a more resilient, diverse supply chain. 

For more information, please continue reading here. 

American Eagle Outfits Its Operation with 3PL Acquisitions 

Highly focused on transforming its supply chain, American Eagle has taken a major step towards a stronger future.  In its Q2 earnings call in September, CEO Michael Rempell announced the planned acquisition of Quiet Logistics.  The 3PL will continue to operate independently, offering in-market fulfillment services for other consumer brands as well as for American Eagle.  Quiet Logistics has operations in Jacksonville, Florida, Los Angeles, Dallas, Chicago, St. Louis, and Boston. 

The $350 million cash acquisition is expected to be finalized by the end of 2021 and was sought to develop a more agile, rapid, diverse supply chain for American Eagle.  The purchase follows American Eagle’s acquisition of 3PL AirTerra, adding new assets for logistics. 

Paired with these new acquisition, American Eagle has positioned itself as the master of its own destiny, in control over consumer desires for fast, free shipping during the holiday season. 

For more information, please continue reading here. 

Kroger Partners with Bed Bath & Beyond on Omnichannel Collaboration 

Starting in 2022, Kroger will begin to offer popular products from Bed Bath & Beyond as well as from Buybuy Baby on Kroger.com.  In addition, Kroger will launch small-scale store pilots at select Kroger locations.  Over the past few years, Kroger has continued to hone and grow its omnichannel strategy and increase its ability to provide consumers with a one-stop shopping experience. 

In 2020, Kroger launched an online marketplace which focused on international and specialty food products.  Kroger has also partnered with Walgreens to create a store-within-a-store concept at some of the pharmacy retailer’s locations. 

One-stop shopping has grown to be a hot concept.  Grocery retailer Hy-Vee also has tested various in-store additions this year, including fitness equipment showrooms, hybrid eyewear kiosks and nail salons. 

For more information, please continue reading here. 

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