Sen. Robert P. Casey Jr. (D., Pa.) has called on Kellogg Co. to explain its plans for suburban distribution centers in suburban Philadelphia and Pittsburgh that the company intends to close in August, idling more than 500 workers, as part of the cereal and snack company’s consolidation of its national delivery network.
In a letter to Paul Norman, president of Kellogg’s North America division at corporate headquarters in Battle Creek, Mich., Casey asked Kellogg to continue its “long-standing commitment to the Pennsylvania workforce” and clarify its plans for the Horsham and Pittsburgh plants, the company’s cereal-processing plant in East Hempfield Township, Lancaster County, and other Kellogg employees in the state.
Last winter, Kellogg said it would close distribution centers across the U.S. as it scraps its system for delivering cereal, cookies, and other snacks directly to stores in favor of working through retail company distributors, an arrangement suppliers say resembles the model used by Walmart, the largest U.S. store retailer and a dominant customer for Kellogg’s and other suppliers.
Besides Kellogg employees, the new system threatens small businesses, including regional truck and van delivery firms, that operate under contract to Kellogg distributors.
Kellogg, which has bought a string of smaller food companies and boosted profits as it consolidates its cereal and snack operations, did not return calls seeking comment.