Kroger CEO: ‘There’s Plenty of Food in the Supply Chain’
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If you ask Kroger CEO Rodney McMullen about the potential for food shortages amid the new coronavirus outbreak that’s spreading across America, he’ll tell you what he and other retail executives told President Trump on March 15.
“We asked President Trump and Vice President Pence to let people know there’s plenty of food and plenty of things in the supply chain,” McMullen told The Enquirer. “And as long as customers just buy what they need and don’t hoard, there will be no problems at all — there’s plenty of food in the supply chain.”
McMullen urges the public to remember that the grocery business deals in perishable goods and is set up to constantly ship and refill store shelves. Also, the company operates 37 of its own factories that produce everything from milk and dairy products to maple syrup and canned goods — all of those factories are working overtime and around the clock.
“Some stores get a delivery truck once a day, some every other day and some stores get multiple deliveries a day,” McMullen said, admitting some vendors, like those making hand sanitizers, are still struggling to meet the high demand.
McMullen
But he added that other packaged goods companies, such as Cincinnati’s own Procter & Gamble, are narrowing their production to focus on churning out in-demand products, such as toilet paper. “Our warehouses are shipping extra toilet paper.”
Besides the conference call with Trump, McMullen has tried to get ahead of the crisis by inspecting one or two stores a day and conferring with industry peers as far away as China, where the coronavirus first struck in December before spreading worldwide.
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McMullen noted the supermarkets and other food and drug stores have remained open throughout the pandemic in even the hardest-hit countries so far, such as China, Italy and Spain.
Kroger is the nation’s largest supermarket chain. Besides Kroger stores, the grocer operates several regional supermarket chains in 35 states, including Fred Meyer, Harris Teeter, Ralphs, Mariano’s, Fry’s, Smith’s, King Soopers, QFC and others.
Pallets of produce, meat and dairy items fill the Kroger Fresh Distribution Center in Blue Ash, Ohio, on March 17. (Meg Vogel/The Cincinnati Enquirer)
In recent days, Kroger has cut back hours at stores in some markets to give employees time to focus on restocking shelves and cleaning stores.
Meanwhile, The Enquirer visited one of Kroger’s distribution centers in the Cincinnati suburb of Blue Ash, which collects and distributes all perishable goods (ice cream, cheese, produce, meat and frozen goods) for 105 Kroger stores in the Cincinnati, Dayton and Northern Kentucky market. A second facility in the Woodlawn neighborhood of Cincinnati does the same thing for dry goods, such as cereal and pasta.
Cincinnati-based Kroger operates 44 distribution centers nationwide that serve all 22 operating divisions. It ranks No. 43 on the Transport Topics Top 100 list of the largest private carriers in the country, with a fleet of 867 tractors, 35 trucks and 12,853 trailers.
On a normal day, the Blue Ash distribution center sends out 120 semi-trucks full of mixed loads of grocery supplies to area stores. It averages 1 million cases of groceries shipped every week.
The last week has been anything but normal or typical. Shipments are up about 40%.
“It’s been like Thanksgiving every day since [March 12],” said Jeff Durrough, the regional director of logistics who oversees both distribution centers.
On March 9, Gov. Mike DeWine declared a state of emergency and on March 12 canceled school for three weeks. Customers that had already been stocking up, went into overdrive at the prospect of being home with children for days on end.
Kroger is hiring as fast as it can for the distribution center to relieve the added weight on the workers, though many have eagerly worked the non-mandatory overtime. With the shutdown of bars and restaurants and layoffs at hotels, the center is looking to poach experienced logistical employees from the hospitality industry to meet increasing shipping demands.
McMullen said companywide Kroger has 10,000 unfilled positions that it needs to fill. Average pay is $15 per hour or $20 if you count benefits.
McMullen said he’s encouraged at how Kroger employees have risen to the occasion as the crisis deepens.
Kroger CEO Rodney McMullen poses for a portrait in June 2016. (Kareem Elgazzar/The Cincinnati Enquirer)
“It’s exciting... all our teams are really working full out — I’m so proud of our teams,” McMullen said. He liked a tweet he saw over the weekend by former TV news anchor Dan Rather:
“You know who are also heroes? Those working the checkout counters and stocking shelves at supermarkets and pharmacies,” Rather wrote. “Their work, at some risk to their own health, is vital to the health and safety of our country.”
Kroger said it is consulting with health guidelines and officials as the pandemic widens. Over the weekend, two store workers in Western states tested positive for the coronavirus.
Those workers are recovering and under medical care. Kroger added emergency paid sick leave to workers who test positive for the coronavirus or placed in mandatory quarantine by their doctors or health officials.
Pressed at how much customers should stock up, McMullen said it ultimately is up to the customer and how much wish to venture out later. Personally, McMullen said he and his wife are getting by on what they have on hand: they eat a Home Chef prepared meal twice a week or something from the freezer.
“There’s not a hard and fast rule,” McMullen said. “Our whole team is stepping up and we’re going to be there when customers need it.”
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