February 26, 2019
Boca Raton, FA-based TreeHouse Foods, the largest private label manufacturer in the United States, sees the tight-fitting freight and logistics landscape as a positive for the company. According to Steven T. Oakland, President and Chief Executive Officer of TreeHouse Foods, this tight landscape will allow the company to leverage its scale and differentiate from competition.
“The freight headwinds that everybody is feeling right now are difficult as we work our way through them today, but I think provide a unique tailwind for TreeHouse long term. Our national footprint, our ability to put multiple categories on the same delivery, our ability to serve the customer across a bunch of different businesses allows us to drive cost-down on logistics, allows us to take working capital out of their system and allows us to be a unique partner,” explained Oakland.
Since taking over as C.E.O. in March 2018, Oakland has had a focus on restructuring the company. Some initiatives include, but are not limited to, the following: plant closures, the implementation of a single I.T. platform throughout the company, manufacturing line rationalization, as well as strategic review of other business units that are generating less than $300 million in sales, which may be divested.
“We were fundamentally not organized to take advantage of scale. We weren't organized from a logistics organization, from a supply chain organization. We weren't organized in my mind, well, from what I saw walking in the door, to take advantage of it. When we had multiple touch points with a customer, but we didn't link them all together,” stated Oakland.
TreeHouse Foods is expecting a decline in revenues of 5 percent for fiscal 2019 – during fiscal 2018, the company generated $5,812.1 million in sales.
Oakland remains optimistic, and had this to say about the company’s future:
“We have identified $1 billion of profitable revenue opportunities in our current categories by helping our customers both grow their categories — so bringing them products and tactics that we have proven across our network in other places — and by growing share, places where we know we have the right to win. Then there’s the opportunity for innovation in adjacencies. Some of those adjacencies will come through our innovation organization. And over time, they’ll come with smaller bolt-on and synergistic acquisitions.”