Baking & Snack - May 2020 - 105

"I THINK THE NEXT STEP WILL BE HOW TO REDUCE, OR ELIMINATE
ALTOGETHER, CONTACT BETWEEN OUR SERVICE PERSONNEL
AND CUSTOMER REPRESENTATIVES AT THE POINT OF SALE."
Mario Somoza, Pan Pepin

While pleased by the strong demand, Mr. Paterakis
cautioned that it would be a mistake to characterize the
flood of sales as a positive for the business. He said the
blitz has disrupted the company's and many others' entire distribution operations. Specifically, it forced delivery
drivers to make two to three deliveries in a single day.
"It is difficult to find enough drivers to satisfy the additional demand," Mr. Paterakis said. "We have had to
go to second- and third-party distribution companies.
That's been a huge issue and a problem."
Pan Pepin did not add any drivers or trucks but they
too needed to increase their workload.
"The only challenge was the long hours that some
drivers and merchandisers were working to meet the
demand at retail," Mr. Somoza said. "Fortunately, we've
started to see that taper off, which has allowed the drivers to work shorter days recently to regain some energy."
Although difficult, bakeries needed to rely on their
delivery drivers to put in more hours. To help bakers
around the country, the American Bakers Association
worked with the US Department of Transportation to
waive the Hours of Service rule to give distributors additional resources. The Hours of Service rule limited the
hours a driver could work per week. The option to let
them work overtime proved critical in some cases.
While consumers stockpiled goods through April, the
current and future demands remain unknown as consumers settle into their post-pandemic lifestyles.

Future forecast
A giant question mark remains as to how the rest of
2020 will unfold in the wake of COVID-19 as bakeries
deal with distribution challenges that change week to
week, or even day to day. In some cases, the strain and
cost of outsourcing distribution and complications with
shifting to a majority DSD system will burden bakers.
In other cases, the creation of an adaptable distribution
model will provide benefits.
Aunt Millie's relied on its flexible distribution network
throughout March and April, but the company is not
resting on its laurels.
"A special task force made up of department leaders
has been meeting every day to review our strategic direction and our execution," Mr. Popp said.
The task force will examine best distribution practices
to continue to meet demand in the future.
"We have been and are in an unprecedented event that
none of us want to go through ever again," he said.

At Pan Pepin, its distribution model also proved beneficial and will operate as-is into the future.
"We have discussed in the past the merits or risks of
going to a channel-service structure, with routes designed for retail or foodservice, but this situation has
proven that our current geographic-centered strategy
gives us the flexibility to respond to sudden market
shifts like what we're seeing," Mr. Somoza said.
Critically, the company is now more aware of all the
points of contact involved in a distribution chain. From
the bakery to a delivery person to the clerk stocking
shelves at a grocery store to the check-out line, each product transfer presents a potential safety risk. Mr. Somoza is
now aware of how those risks can impact employee and
consumer health ... and a baker's bottom line.
"To the extent that systems and processes can be designed to minimize contact, it will be easier to contain
these types of viruses in the future," Mr. Somoza said. "I
think the next step will be how to reduce, or eliminate
altogether, contact between our service personnel and
customer representatives at the point of sale."
From additional personal protective gear to new delivery times to staggered distribution shifts, bakers must
be able to shift into overdrive at the flip of a switch.

*

Distributors need to
consider additional
safety measures in the
wake of COVID-19.
Aunt Millies



Baking & Snack - May 2020

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