The rapid growth of specialty foods and changing consumer behavior is placing new requirements on processors, distributors and retailers. Cold chain members need to develop the scale and operating flexibility to support growth and changes in how food is produced and distributed.

1. Eating Food is Risky
Business…But, Not
Eating is Lethal
Food is Changing…
• Preparation
• Distribution
• Sell
• Consume

2. Food is Changing…and so are
Processors, Distributors and Retailers

3. Changes in food require a
new model for distribution

4. As food changes , new requirements are being
placed on a fragile transportation network.
On average there were 12 refrigerated loads for every available
tractor…in many cases forcing rates to exceed $9 per mile

5. • Mainstream retail channels are heating up
• Millennials buy specialty foods wherever they shop (convenience oriented)
• This trend is driving sales in multi-unit grocery and mass merchants
• These mainstay grocery channels are outpacing natural or specialty chains for the first
time (hence the Amazon and Whole Foods acquisition)
• Consumers are especially focused on specialty foods in the refrigerated sections
• Categories with the biggest sales growth (+30%) are refrigerated juices & functional
beverages
• Refrigerated lunch and dinner entrees are up 33% with yogurt and kefir up 27%
• Manufacturers’ net profits have risen to 18%, despite costs for certification, ingredients,
and production
• 70% of distributors plan to expand their specialty food SKU count in 2017.
• Retailers’ average transaction size increased 19 percent in 2016
Main Stream Grocers are Being
Driven by Specialty Food

6. Warehouse of the Future –
More Food Hub than Warehouse
• Multi-purpose
• Shared facility – coopetition among industry members
• Multi-temperature
• Convertible rooms for flexibility and to accommodate
seasonality/complementary cycles
• Value added services needed
 Quick Freezing
 Quick Chilling
 Quick Temper
• Multi-temperature (dry, chilled, refrigerated, super-
chilled, frozen, ultra frozen
• Need for high density storage, cross dock and pick lines

7. The future of refrigerated
warehousing is toward multi-function
• Assure ample size with dynamic
flexibility
• High density, long-term storage
• Quick turn, distribution racking
• Cross dock
• Quick freeze/chill integrated into
the warehouse
• Multi-product that can meet ‘Mean
Kinetic Temperature’ target
• Mix of public storage and private
warehousing
• Connected end to end

8. • Food Warehousing is a Regional Model
• Distribution Scale and Dynamic Flexibility are King
• Compliance is Multi-faceted
Area Descriptor Relevance
Major Regulatory FSMA Sanitary Trucks and Facilities
Non Regulatory GFSI - HAACP Shows expertise
Customer Driven Cold chain Your customers ‘quality promise’
Code and Standards Food Code Fed, State and Local
In Closing

9. Challenges Will Persist
• Driver Shortages
• Increasing transportation & warehousing rates
• Electronic Logs (by Dec 2017)
• Sanitary Transportation Mandates
• Greater Customer Expectations
• Need for hyper-connected cold chains

10. Contact Info
Nick Pacitti
npacitti@ticold.com
330 217 8005