Delhaize Banner Harveys to Close DC, Consolidate Office

NASHVILLE, Ga. -- Harveys, a regional supermarket chain based here and owned by the Belgian Delhaize Group, said it will close its Nashville, Ga., distribution center next May and consolidate some of its corporate office functions in an effort to cut costs and leverage the resources of its sister banner Food Lion.

Approximately 200 employees will be affected between now and the third quarter of 2006, the company said. "The closing of the Harveys distribution center and the reduction of a limited number of office personnel at the corporate office is a natural evolution toward creating a more competitive, financially stable, and profitable organization," said Tom Robinson, Harveys' recently elected c.o.o., in a statement. "Plus, this move will permit us to leverage the synergies and capitalize on the strengths of our sister banners in the Delhaize Group family. This will result in increased efficiency, producing better prices for our customers."

The Harveys stores will be supplied by Food Lion distribution centers in South Carolina and Florida. Category, retail, and many other functional departments will remain at Harveys' corporate office, the company said, in an effort to help the stores maintain their local focus.

While the move looks to be a profitable one for Delhaize, public officials in Nashville were not pleased with the impacts the parent company's strategy will have on their community. Robert Griner, county commissioner, was quoted in local press reports as saying he was shocked to hear the news of the facilities closing, and that it would be an economic loss to the southern Georgia community.

Food Lion's parent company, Delhaize Group, acquired Harveys in 2003. In March of this year, Nashville officials put together an incentive package estimated at $5.2 million to help persuade the company to stay, according to reports.

Harvey's acknowledged in its statement that the decision to close the DC was difficult to make. "This work force reduction plan was a very difficult decision, but it is the right one to ensure a stable and profitable long-term business in the highly competitive supermarket environment, and to continue to serve Harveys' large, loyal customer base," Robinson said.

Harveys said it gave advance notice of the closing and reduction in staff to give its employees time to figure out their own next moves. Affected employees will be offered opportunities at Food Lion's distribution centers, in Harveys stores, and elsewhere in Food Lion, the company said. Those persons who choose to not pursue these opportunities will receive severance packages and outplacement support.

J.H. Harvey Co., LLC operates 67 stores and employs approximately 3,500 team members in Georgia and Florida.
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