Nestle to Exit U.S. DSD Network for Pizza and Ice Cream

Some 4000 jobs are expected to be cut as Nestle USA pivots away from its direct-store-delivery (DSD) network for its ice cream and frozen pizza businesses to a warehouse-oriented system, the Swiss-owned food and beverage giant announced Monday. 

While Nestle said the move to exit from the DSD network is in line with on-going changes in the retail space, the decision will result in the closure of a number of the company’s facilities. 

“This decision came after careful consideration and, while critical to achieve our business goals, it will impact employees in our sales and supply chain teams, and will result in the closure of eight company-owned frozen distribution centers and our frozen inventory transfer points,” Nestle USA Chairman and Chief Executive Officer Steve Presley said in a press release. “These employees have worked incredibly hard to serve our customers.”

The changes will commence in third quarter of this year, and are expected to be completed by the second quarter of 2020. 

“Moving to a warehouse model has numerous benefits for us and our retail customers,” Presley said. “By taking advantage of the unmatched breadth and depth of our frozen warehouse network, our retail customer partners can better leverage their existing networks. This change is a win-win for Nestle and our customers.”

Nestle will provide information and support to the impacted workers, the release said. 

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