Kroger Outsources Louisville DC Operations

The Kroger Co. sold its Kentucky Distribution Center in Louisville, Ky., to Zenith Logistics Inc., a subsidiary of Walton, Ky.-based Verst Group Logistics, which will own and operate the warehouse. Exact terms of the deal were not disclosed.

The 776,000-sq.-ft. warehouse ships dry groceries and frozen and perishable products to 140 stores in Cincinnati-based Kroger's Mid-South division, said Tim McGurk, Kroger's customer relations manager for the Louisville area.

"Our goal is to make this invisible to our customers at the stores," McGurk said. "We remain committed to running the best grocery stores in the market." All of the center's 850 employees will be offered jobs with the new companies, McGurk said.

As reported in the local media, representatives of Teamster Local 89 reacted angrily to the news. The union represents over 800 workers at the facility, and had signed a new six-year contract with Kroger last December. A Zenith executive said that pay information provided to current employees, which was $5 to $6 less per hour than many were currently making, was only a starting point for negotiations with the union.

Zenith Logistics already operates Kroger distribution centers in Indianapolis and Cincinnati.

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