Snyder's-Lance, Inc. and Inventure Foods, Inc. announced completion of a strategic distribution agreement that will expand the Snyder's-Lance independent business operator (IBO) route distribution system in Arizona and offer increased access by Inventure to the growing Snyder's-Lance national distribution network for their brands.
The strategic agreement provides a unique opportunity for both Snyder's-Lance and Inventure. In recent years, Snyder's-Lance has developed its direct store delivery (DSD) network through a blend of selective acquisitions and organic growth. By entering into this agreement, Snyder's-Lance will expand its DSD network in the Southwestern U.S. and increase route volumes with new partner brands while Inventure's specialty food brands will benefit from wider distribution of a national DSD network of over 3,000 routes. Terms of the agreement were not disclosed.
The agreement provides that Snyder's-Lance will assume a number of IBO routes from Inventure in the Arizona area, which supports the Snyder's-Lance strategic plan to continue growing and strengthening its national DSD distribution network. At the same time, Inventure will receive access to the growing Snyder's-Lance distribution network with expanded opportunity as a key partner brand.
"We're excited to continue the development of our DSD network through this distribution agreement with Inventure," said Carl E. Lee Jr, president and chief operating officer of Snyder's-Lance, Inc., in a prepared statement. "These routes are in a strategically important location for our company and will help us to provide excellent service for key customers. Moreover, Inventure product lines such as Boulder Canyon and Poore Brothers provide an opportunity for Snyder's-Lance to increase the scale and reach of our network, helping to grow route volumes across all brands while bringing the benefits of our DSD distribution system to both Inventure and our retail partners. Snyder's-Lance and Inventure have partnered together for approximately 15 years, distributing each company's products in their respective DSD networks. This new arrangement expands on an already successful relationship."
"We look forward to the support that this strategic agreement will provide our growing and important Boulder Canyon brand throughout the country," said Terry McDaniel, president and CEO of Inventure Foods. "This is a very important partnership for Inventure Foods, which further underscores our commitment to deliver our premium products to leading retailers, while leveraging the growing Snyder's-Lance DSD network of store level execution."
As a result of this transaction, Inventure Foods will no longer distribute third party partner brands resulting in a reduction of approximate $3 million in net revenues. This lost revenue will have no impact to Inventure Foods earnings.
