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Nine years ago three veterans of the food industry decided to start Greystar Products to bring well-known brand names in the restaurant industry to the grocery shelf. The company, based in Orange, Calif., has successfully launched a line of Tony Roma's barbecue sauces and is preparing to launch a line of products from the Panda Express chain of Asian restaurants. Several other product deals also are in the works.
"Our concept is to license famous brand names and bring them to the marketplace, rather than to reinvent the wheel by developing a brand," says Terry Italia, Greystar co-founder and president. "The idea is to find brands already well-known in one area and bring them to another area."
Italia has 25 years of experience in the food industry with major food companies like Kraft, ConAgra and Heinz, as do his two partners. "We learned all the ins and outs of the grocery business before going off on our own," he says.
Greystar decided to act as its own distributor, selling directly to the retail channel. This goes against the common practice for small companies, which is to go through a distributor. "Typically, using a distributor is easier for a small company because it involves selling to a much smaller number of customers," Italia explains. "We didn't want to do that because we felt that for the volumes we wanted to generate in our category, we needed to go direct to the grocery chain's warehouse."
That is where logistics provider Case-Stack came into the picture, Italia says. "Because we are not a big company like Kraft or Heinz that can run its own distribution centers, we wanted a partner that could do that for us. We went to market looking for a full, turnkey logistics solution."
CaseStack's operations for Greystar are very much like what one of these larger companies would have in-house, Italia says. "In fact, if all of the companies that CaseStack represented were looked at as one giant company, it might be the size of a Heinz or a Kraft. The difference is that they set up a full logistics system on behalf of several smaller companies, which enables those smaller entities to act like big companies in the marketplace."
This is very important in the grocery business, Italia says. "The grocery trade doesn't tolerate a lack of good service. You just can't fail to deliver on time and as ordered. Having come from this industry, we knew that we needed to look like a big company to our customers. For us, a shared logistics supplier like CaseStack was the perfect solution."
This was true from a cost consideration as well, Italia says. "If we were to try to do on our own what CaseStack is doing for us, it would simply be cost prohibitive and would keep us from accomplishing our mission," Italia says. "I would have to raise the price on my products to a point that would prevent consumers from buying."
Another way that CaseStack helps Greystar take advantage of multi-company synergies is through its green consolidation program. Major retailers like Wal-Mart combine orders from several CaseStack clients so that a full truckload can be delivered, rather than several smaller shipments. "We sit right in the middle of the retailers and manufacturers and suppliers," says Case-Stack CEO Dan Sanker. "We are working to bring them all together so that when trucks leave our warehouses, they are full. When you ship less air you save money and use less fuel, which means you have a smaller carbon footprint. It's great for the environment and great for the pocketbook."
Greystar previously had worked with another logistics provider but decided to switch to CaseStack "not because we had a terrible experience with the other provider, but because CaseStack simply offered more," says Italia. He specifically cites the Web-based inventory visibility solution that CaseStack offers. "It has more real-time data and just made it a lot easier for us to manage our inventories," he says. "Our job is to keep our inventory at the correct levels in the four CaseStack warehouses that we use and we have online access to all the data that we need to do that."
Italia also underscores the importance of the "human element." "No matter how good you are, there are always exceptions-somebody didn't get something or someone is running a promotion and no one passed that information along. The nice thing about CaseStack is that there is always somebody to talk to and they are always willing to help us solve problems. So we are very happy that the human element is there and we can rely on them to help us.
"I could make it sound real complicated," Italia continues, "but the most valuable thing is that CaseStack has a system that works for small- to mid-sized companies and that is acceptable to the giant grocery chains that are our customers. A company our size could not bring new and innovative products to the market without that help."
Greystar Products, www.greystarproducts.com
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