Dr Pepper Snapple axes Texas distribution site, TEN sales fall flat

Related tags Dr pepper snapple group

Picture Credit: Steven White/Flickr
Picture Credit: Steven White/Flickr
Dr Pepper Snapple Group (DPS) has confirmed that it plans to close a Texas warehouse and distribution center and consolidate operations at a larger facility in the state.

Documents submitted to the Texas Workforce Commission state that DPS will close its Springwest Drive facility over the fortnight of the week commencing December 6.

Operations at Spring will be consolidated at Holly Hall, Houston, where there is also warehousing and a distribution facility, as well as bottling capabilities.

'More seamless' distribution operations

DPS director of communications, Chris Barnes told BeverageDaily.com:“The Houston plant is prepared for the transition. It makes our direct store delivery operations more seamless in the Houston area.”

Barnes told the Houston Business Journal that the switch would make it easier for DPS to serve retailers more directly, removing the need for shipping goods from Houston to Spring for local distribution.

100+ staff at Spring will be offered either redundancy agreement or employment at the Houston site, but DPS is unable to say as of now how many employees could leave the company.

However, of 18 people directly affected by the closure, 15 will be offered new jobs in Houston, and Barnes said that many of the 100 staff were mobile workers who spent most of their time visiting retail clients.

Flat sales for critical TEN platform...

DPS announced its Q3 2013 results today with president and CEO Larry Young striking a slightly sombre note, amidst fears among some analysts over the performance of poster child Dr Pepper TEN, and indeed the firm's TEN (ten calorie) platform as a whole.

Net sales grew slightly to $1.543bn ($1.528bn in Q3 2012) but net income fell in the quarter to $207m ($179m, 2012).

TEN sales of finished beverages sold by DPS and its bottlers to retailers and independent distributors were flat.

And high single-digit growth for Canada Dry was offset by mid single-digit declines in 7UP and Sunkist soda.

We continue to operate in an extremely challenging environment, with significant pressures in the CSD category now impacting both regular and diet products,” ​Young said.

Nonetheless, Young insisted that DPS had continued to gain volume share in the CSD category whilst retaining its value share.

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