By Josh Beckerman
Nestle USA will exit its company-owned frozen direct-store-delivery network for pizza and ice cream, planning to shift to a warehouse model starting in the third quarter.
The company will close eight distribution centers.
The Nestle SA (NESN.EB, NSRGY) unit said "leveraging a simpler route to market unlocks resources we can use to fuel our efforts in demand generation, such as product innovation and brand building."
Nestle noted "unprecedented shifts in consumer behavior," while its retail customers "also are evolving."
The transition is expected to be complete early in the second quarter of 2020.
In February 2017, Kellogg Co. (K) said it would exit its direct-store-delivery network for its U.S. snacks business, reducing complexity and cost structure.
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