This year, rising food costs and a record-breaking trucking shortage rocked quite a few industries, with Sysco one of many unable to avoid the higher budget needed to navigate the current market. As a result, Sysco has been forced to cut jobs at its shared services center in Cypress, Texas, in early 2019, according to a report by the Houston Chronicle.
“We continue to see expense challenges in the warehouse and transportation areas of our supply chain, which we anticipate will persist,” said President and CEO Tom Bené earlier this year. “We remain focused on the execution of our strategic priorities, which we believe will serve as the roadmap for additional growth and value creation.”
In a conference call with analysts, according to Seeking Alpha, Bené added: “Our problem is our operating expenses. They’re growing faster than what we’re getting on case growth. That’s our issue, and we’ve got to get back in check.”
The primary roles at the Cypress facility consist of administration roles, like accounting, customer support, and payroll.
“As part of this initiative, the company anticipates the loss of employment for a modest number of associates at each of our U.S. broadline operating companies,” Sysco said in a statement. “We take seriously any decision that impacts our associates but feel this is a necessary step to better serve our customers and continue to position the company for success.”
Sysco has not disclosed the number of layoffs, but a Sysco spokeswoman did note that the company has plans to hire other workers at its Cypress facility that will result in a net gain in jobs over the long term, the news source relays.
Will Sysco’s latest strategy be enough to revive its bottom line? Deli Market News will continue to report.