Flowers Foods currently operates two business segments: a direct-store-delivery
segment (“DSD Segment”) and a warehouse delivery segment (“Warehouse
Segment”). The DSD Segment operates 39 bakeries that market a wide variety
of fresh bakery foods, including fresh breads, buns, rolls, tortillas, and snack
cakes. These products are sold through a direct-store-delivery model to retail
and foodservice customers in the Southeast, Mid-Atlantic, New England, Southwest,
California and select markets in Nevada, the Midwest and the Pacific Northwest.
The Warehouse Segment operates 10 bakeries that produce snack cakes, breads
and rolls for national retail, foodservice, vending, and co-pack customers,
which are delivered through customers’ warehouse channels and one bakery
mix plant.
The DSD Segment’s fresh bakery foods were available to approximately
85% of the U.S. population. Our DSD Segment is comprised of approximately 5,100
independent distributors who own the rights to distribute certain brands of
our fresh packaged bakery foods in their geographic markets. The company has
approximately 600 company-owned territories with the distribution rights for
those territories available for sale and an additional 230 company owned and
operated territories with the distribution rights that are not available for
sale.
The Warehouse Segment’s fresh snack cakes and frozen breads and rolls
are sold nationally direct to customers’ warehouses and delivered through
frozen and non-frozen contract carriers.
Flowers Foods has focused on developing and refining operating strategies to
create competitive advantages in the marketplace. We believe these strategies
help us achieve our long-term objectives and work to build value for shareholders.
Put simply, our strategies are to:
·
Grow Sales. We develop new and core markets through new customers, new products,
strong brands, and acquisitions. We have a three-pronged strategy for growing
sales through acquisitions, market expansions, and core markets.
·
Invest Wisely. We use technology and efficiencies to be the low-cost producer
of delicious bakery foods. We invest to improve the effectiveness of our bakeries,
distribution networks, and information systems.
·
Bake Smart. We innovate to improve processes, enhance quality, reduce costs,
and conserve resources.
·
Give Extraordinary Service. We go beyond the expected to meet our customers’
needs.
·
Appreciate the Team. We respect every individual, embrace diversity, and promote
the career growth of team members.
As a leading U.S. baker, our products are available to consumers through traditional
supermarkets, foodservice distributors, convenience stores, mass merchandisers,
club stores, wholesalers, casual dining and quick-serve restaurants, schools,
hospitals, dollar stores, and vending machines. To enhance our ability to grow
sales, we develop bakery products that are responsive to changing consumer needs
and preferences using market research and the strength of our well-established
brands. We establish and strengthen our brands in existing and new markets by
focusing on product quality, offering a broad and diverse product line, and
providing exceptional customer service. We expand our geographic reach by making
strategic acquisitions and expanding from our existing bakeries into new markets.
Growth through acquisitions has been an important component of our strategy.
Since our initial public offering in 1968, we have made over 100 acquisitions.
Over the last ten years we have completed fourteen acquisitions that, at the
time of each acquisition, added approximately $2.0 billion in annual revenue
in the aggregate. Other than the Sara Lee California and the Acquired Hostess
Bread Assets acquisitions discussed below, our primary acquisition targets have
historically been independent/regional baking companies in areas of the country
where we have not previously had access to market our fresh baked foods.
Invest Wisely and Bake Smart
Throughout our history, we have devoted significant resources to automate our
production facilities and improve our distribution capabilities. We believe
these investments have made us one of the most efficient producers of packaged
bakery products in the United States. We believe our capital investments yield
valuable long-term benefits, such as more consistent product quality, highly
sanitary processes, and greater production volume at a lower cost per unit.
Give Extraordinary Service
When it comes to our customers, our strategy is to go beyond the expected. We
know that great service helps build strong relationships with our retail and
foodservice customers. Our reputation for excellent service supports our sales
growth in core markets and helps us as we move into new markets.
Appreciate the Team
We strive to maintain good relationships and ongoing communications with all
of our team members. We are committed to equal employment opportunities, meeting
all federal and state employment laws, and striving to respect the dignity of
all of our team members and associates. In addition, our subsidiaries provide:
Fair and equitable compensation and a balanced program of benefits;
Working conditions that promote employees’ health and safety;
Training opportunities that encourage professional development; and
Ways for team members to discuss concerns through our open door policy and peer
review program.
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