What’s Next For Sysco and US Foods?

A lot has happened in 18 months…but what about the next 18?

Well, we can ease our minds now that the uncertainty is over. At least for the short term, the Sysco/US Foods merger will not go through as planned. But wait a minute, is that it? Hardly.

If you’re like many of us you live in an “if this than that” world. According to Morgan Stanley (see NRN link below) “Sysco is big enough and it could still cut costs.” You know all that lost money over the past 18 months will need to be absorbed somewhere. Think about all that uncertainty.

Consider the manufacturer’s fear of having their products de-listed and a reduced opportunity for new products. Or the Teamsters and workers throughout the organizations that were concerned about their jobs. And, of course, restaurant operators and food providers worried about increased food costs.

It doesn’t seem enough that these two companies simply go back to business as usual. Well intended, they wanted to merge with the promise of change, or at least with the belief of change. If they truly believed that strongly that change was needed – backwards simply isn’t an option.

We find it interesting that while Sysco and US Foods were doing their thing for 18 months, manufacturers and restaurant operators were responding and doing their thing. Again, if this than that! They were working on their contingency plans and so, the great chess game continues. This ruling would prove truly amazing if the distributor, operator, and manufacturer all figure out what is needed for our cautiously optimistic industry to work together.

FlashPepper wanted to bring to light the financial side of the equation and the articles linked below are a good read:

But we wonder what will become of these two companies in the next 18 months? The Teamster’s on-line voice is passionate and we are paying close attention to bringing that voice forward. We don’t have to remind you that without them, we would have a hard time getting the food to the table! A little secret to the world — one of us at FlashPepper once worked for Alliant, aka US Foods, and the drivers, pickers, and will-call support were our allies and lifeline. Together, we made it happen for the customer.