Nestlé USA Inc. is closing its cold storage and distribution center in Brooklyn Park, resulting in the layoff of 56 full-time workers, in a move reflecting broader challenges for the food industry.
The closure is one of eight facilities in Nestlé’s direct-store-delivery (DSD) network to be shuttered as a result of restructuring. The company announced in May plans to exit its DSD business for pizza and ice cream. The Brooklyn Park facility, at 7130 N. Winnetka Av., is a part of that network.
Nestlé, like many food companies, is being forced to simplify its supply chain as retailers increasingly want more control over their inventories. Rather than selling to and restocking retailers directly from these smaller, DSD locations, Nestlé will rely on its existing warehouse system, as well as the warehouses of its retail customers.
All jobs at the facility — including sales, merchandising, drivers and supply-chain coordinators — will be eliminated, according to a Worker Adjustment and Retraining Notification (WARN) notice published Tuesday by the Minnesota Department of Employment and Economic Development. The cuts will occur throughout the holiday season, beginning Nov. 1 and ending with the facility’s final closure on Dec. 31.
A Nestlé spokeswoman declined to name the other seven facility closures.
The Brooklyn Park facility was a part of Dreyer’s Ice Cream Co., a Nestlé subsidiary since 2002. Nestlé USA is a subsidiary of Switzerland-based Nestlé S.A.
“Moving to a warehouse model has numerous benefits for us and our retail customers,” Steve Presley, chief executive of Nestlé USA, said in the May announcement. “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 ... These employees have worked incredibly hard to serve our customers. Treating them with respect through this process is a top priority for us, and we are committed to doing all we can to provide them information, resources and support.”