 This refrigerated storage service company’s VP of sales and marketing tells us how his company hasn’t shut profits out in the cold.
The frozen and refrigerated food industry is a cold one, not only in its products and services, but also in its competition. With tightening regulations and growing food demands, the margin for error is as thin as ice.
“There is steady growth in the frozen and refrigerated food category in both retail and foodservice sectors,” said Jerome Scherer, vice president of sales and marketing at US Cold Storage. “Frozen products are in high demand because they are convenient to use, healthful, and generally good tasting. So we are investing heavily in technology, modern facilities, and employee training.”
 Jerome Scherer, VP of Sales and Marketing
USCS has provided refrigerated storage services to the food industry since 1889. It now has facilities in 30 locations across the country, with more than 155 million cubic feet of space. The company specializes in everything from storage to logistic solutions.
Although USCS built a reputation on its own for the better part of a century, it was set up for greater long-term success in 1982 when it was purchased by Swire, a company founded in the UK in 1816. Swire is involved in refrigerated warehousing, shipping, road transport, and more in the US, Australia, and Asia. According to Scherer, Swire’s assets gave USCS an advantage over its domestic competition.
“Swire is extremely well-financed and stable, so at a time when USCS needed capital to grow, Swire provided support for us to build new facilities and invest in modern technology,” said Scherer. “Along with that, Swire guides our growth as if we’re on a 100-year plan. That helps us avoid knee-jerk decisions and make investments to put us in the right place for years down the road.”
Swire Cold Storage continues to expand, including moving into the international arena in places like China. The company knows it needs more space and service to meet its customers’ growing needs, and it’s adding space on a case-by-case basis. It has also developed relationships with its customers that are paying off in significant ways.
“A lot of our growth strategy is customer driven. Kellogg’s and other food companies asked us to provide services in the Northeast, where three or four years ago we had no major distribution centers in that area,” said Scherer. He used the Kellogg’s example to represent many USCS customers that have expanded into other markets and are in need of more services. “We’re extending our relationships with existing customers. As they grow and have national needs, we’re building to accommodate their distribution requirements in every part of the country.”
USCS has also developed new technologies to improve its services. It worked with internal programmers and analysts to develop a design for a new warehouse management system. Much of the actual programming was outsourced, and the result is a proprietary WMS that allows management to closely track all activities in the warehouses. According to Scherer, the technology uses RF barcode scanners, label applicators, readers, WMS links, and a variety of middleware linked to support RFID technology.
“We developed the system to meet the needs of our 2,500 customers at the time. You can imagine the variety of needs those customers have, as we often have up to 300 customers and tens of thousands of quick-turning SKUs under one roof,” said Scherer. “The old WMS wasn’t adequate. We needed to be able to make changes in the system’s priorities on an event-driven basis, so we built a standardized but flexible system to meet our needs. It gives USCS’s management the ability to modify work activity based on the flow of product and the priority status of customer orders.
Cooling down
Of course, along with logistics expertise, advanced technology, and new facilities, USCS invests a great deal of resources in improving its workforce. According to Scherer, the company has always sought to provide its employees with a family-oriented environment and fair salaries and benefits. The result of this is an excellent retention rate.
“Our average manager on duty has been with us for around 20 years. We have a depth of experience in that group and knowledge that is second to none in the industry,” said Scherer. “We support that with inhouse training programs at all levels in each department. We also depend on the World Food Logistics Organization, and through its annual institute, we send promising people to get training in all areas of public refrigerated warehousing.”
And as the company grows, USCS matches its commitment to its people with a commitment to making its programs and services as environmentally sound as possible. Scherer said the company is working with the industry and various government departments to develop systems to maintain its current food safety and security standards while looking at advanced refrigeration technology and renewable energy sources. Fuel and energy costs are rising, and to stay competitive, USCS knows it needs to invest in those future tools now.
“It will help both us and our customers stay competitive, and we know creating these systems allows us to minimize our impact on the environment,” said Scherer. “We will be aggressive in any area that will reduce our carbon footprint.”
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