Case Study

Sherwood Food Distributors and Ryder A recipe for responsive feet management

C H A L L E N G E R E S U LT S

Shipping 16 million pounds of food products weekly – many of which are highly perishable – in perfect condition and on-time is key to Sherwood serving its 5,000 customers. Missing one tight delivery window can signifcantly impact customer satisfaction and business operations.

S O L U T I O N

Ryder’s Full Service Lease solution provides the management expertise and customizable feet to deliver outstanding service to Sherwood Food Distributors. In addition, Ryder’s on-site maintenance operation and team of expert technicians ensure optimal feet performance.

Responsiveness Trucks available on short notice for new markets and locations

Replacement trucks and trailers immediately available in the event of a breakdown

Cost Savings Better fuel effciency from feet enhancements like automated transmissions

Predictable monthly rate for all trucks and maintenance

Effcient Preventive maintenance maximizes vehicle uptime for improved on-time deliveries

Fleet reporting system and cutting-edge diagnostic and repair equipment used by expert technicians gives Sherwood up-to-date information for, better control of their feet operations

FLEET LEASING & MAINTENANCE | DEDICATED TRANSPORTATION | SUPPLY CHAIN SOLUTIONS

In the demanding food distribution industry, few companies have succeeded and grown like Sherwood Food Distributors. Founded in Detroit in 1969 by Alex Karp and Earl Ishbia, the company is now one of the largest independent distributors of meat products in the U.S.

Sherwood ships 16 million pounds of food products weekly using a fleet of more than 250 tractor trailers operating from distribution centers in Detroit; Cleveland; Atlanta; Miami; and Walton, Kentucky. With a robust network of over one million square feet of refrigerated warehouse space, the company stocks one million cases of inventory across more than 50 food categories.

Delivering these products – many of which are highly perishable – in perfect condition and on-time is key to Sherwood serving its 5,000 customers. These include retailers, wholesalers, institutions, food service providers, and cruise lines. Using the latest advancements in technology, the

company’s state-of-the-art warehouse management system and expansive product mix allow Sherwood to rapidly fill orders accurately and quickly.

In fact, Sherwood’s promise is renowned with its customers and in the industry: “Place your order by 5 p.m. any weekday, and it will be on its way to your location by 5 a.m. the next morning.”

Delivering on this promise time and time again – even under the most challenging conditions – is possible largely because of Sherwood’s long-standing partnership with Ryder for its fleet management needs, says Phil Walega, Vice President of Transportation at Sherwood Food Distributors. The partnership has supported Sherwood’s acquisition strategy, he says, because the company can depend

on Ryder to rapidly provide equipment and services in new locations.

“We operate in a highly competitive marketplace, differentiating ourselves by offering excellent customer service and the right pricing of the right products that are delivered within the time frames that meet our customers’ needs,” Walega says. “We customize our warehouses for

each of our locations and we pride ourselves on being able

to tell our customers, ‘if you want it, we will get it to you’.”

Operating within the tight profit margins that characterize the food industry, and recognizing gaps in the market that Sherwood can fill by providing its exemplary customer service is how the company intends to keep growing. The continued acquisition of healthy, smaller companies, along with providing distribution services for customers who require assistance, also play a significant role in Sherwood’s future growth strategy. Ryder plays a critical role, Walega says, as the success of these strategies relies heavily on keeping Sherwood’s fleet consistently on the road and ready to expand whenever and wherever the need arises.

“We began doing business together in 1982 with 20 vehicles for Orleans International – what is today Sherwood Food Distributors. Over the years, times haven’t always been easy – neither for Sherwood nor for Ryder. What’s been fascinating about this partnership is that both organizations have always endeavored to come to the table, overcome the challenges in front of us, and find the best solutions to serve the best interests of both partners,” says Michael Palmer, Vice President of Fleet Management Solutions at Ryder.

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The decision to outsource

Back in the late 1980s, Sherwood exlpored leasing rather than owning its fleet – a move it had never made before and a practice that Walega, a previous owner/ operator, was unfamiliar with. At first, he was concerned that he might lose control of the fleet, and customers might question that another company’s trucks were making Sherwood’s deliveries. But these concerns were quickly alleviated as Ryder began to provide equipment through its Full Service Lease solution and on-site maintenance program.

“Ryder helped us build up our fleet in all divisions. The fact that we had one, single source for leasing, maintenance, certifications, documentation, and licensing was very welcome,” Walega says. “The transition and execution were seamless. I never felt a loss of control because Ryder was so transparent – I could see where everything was at any given moment.”

Enhancements to Sherwood’s fleet, like the provision of automated transmissions, made it more fuel efficient, cost-effective, and driver-friendly.

“This has been a home run for us,” Walega says. “Attracting and retaining drivers is very important to our business and difficult to do in the industry. The fact

that drivers love our trucks means that I can attract and keep more of them, and do more business. It’s a great recruiting tool.”

Walega also notes the company has seen its most important metric, fuel consumption, decrease continuously over time to yield substantial cost savings primarily due to the increased efficiency of the equipment Ryder provides.

On-site maintenance provides exacting control

Ryder’s on-site maintenance services make Walega feel like an owner/operator, he says, because they provide crucial services at locations dedicated exclusively to Sherwood.

“We wanted out of the maintenance business, but needed to have immediate access to it,” he says. “Ryder gave us that and we could never give it up. We love it. We consider their staff, our staff.”

Long recognized as a leader in maintenance and fleet services, Ryder created an on-site program for Sherwood centered on providing state-of-the-art shops precisely where the company required them and by continuously improving its procedures. Maintenance is performed by technicians certified in multiple disciplines, using cutting-edge diagnostic and repair equipment, and who provide the most advanced preventive

care to the fleet. Ryder also has a reporting system that gives Sherwood visibility and better control of fleet operations – all at a predictable monthly expense.

“ We call much of our newer equipment sourced by Ryder – along with the substantial drop in fuel costs provided by Ryder – one of our top five margin-makers.

- Phil Walega, Vice President of Transportation, Sherwood Food Distributors

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“We’ve always been able to stay a step ahead and that’s what has made the difference. From the local front lines all the way up to the executive leadership within both corporate organizations, we have been able to nurture and grow our operations together,” says Palmer.

The fact that Ryder’s program works so well allows us to concentrate on the actual business of food distribution, Walega notes, adding: “Our customers love to see the Ryder trucks pull up. They know they are getting what they need when they need it, no matter what.”

Reliable, agile feet execution Delivering on the Promise - Always delivers growth

The value of Ryder’s fleet management expertise for Sherwood has been affirmed many times over the years.

In 2005, Florida was hit with a series of hurricanes that devastated the state, including Hurricane Wilma, which paralyzed much of the state’s infrastructure for weeks. During that time, Sherwood was serving cruise ships at Port Miami and Port Everglades in Fort Lauderdale. With a brief window of time in port to refuel and restock food and beverage provisions before leaving with the next group of passengers, the ships were left stranded by many of their vendors’ inability to deliver goods in the aftermath of the storms. The exception: Sherwood Food Distributors.

“Despite the fact that fuel was in very short supply, Ryder made sure our trucks were fueled and running, so we could make our deliveries,” Walega said. “Once our cruise ship customers realized we could always be on the road, they ordered everything from us. We became their number one vendor. This laid the foundation for us to gain many new cruise line customers.”

Walega also notes the time when Sherwood secured new business in Atlanta on a Friday, and it was critical to have 50 trucks there to begin making deliveries there on the following Monday.

“Within 48 hours, Ryder had 50 trucks in the yard and ready to go,” Walega says. “To this day, I am amazed at how quickly they did this. It’s clear to us that, whatever we are doing, Ryder stands behind us.”

Keeping promises to customers is at the heart of how Sherwood Food Distributors operates, says Vice President of Transportation Phil Walega, who adds that he can do this with confidence because of the company’s partnership with Ryder. Walega notes one example in particular of how Ryder’s commitment to excellent service and flexibility shows a deep understanding of Sherwood’s business and that of its customers.

The Chicken Shack, a popular restaurant chain in Detroit, has depended on Sherwood for decades to provide it with the freshest ingredients. When founders John and Iola Sobeck decided to rebalance inventory across their 20 restaurants, they knew Sherwood would get the right products to the right locations. And when the restaurant chain needed its own delivery truck, Sherwood and the Sobeks turned to Ryder for help in obtaining a vehicle perfectly suited to their needs.

“When deliveries arrive on time and the food products get there in quality condition because your fleet is running in top condition, we know that has a direct impact on keeping our customers coming back for delicious chicken,” says Mark Sobek, President of The Chicken Shack, who is working alongside his parents in the family business.

Successful business relationships like these are all about trust and commitment, Walega emphasizes.

“Ryder makes it a point to accommodate our needs,” Walega says. “Their overall mission is to understand our business and the critical role our trucks play in serving our customers.”

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