Goodman says they are happy to have come to the table, particularly given they are a long-standing customer of W&C, which is currently run by Pat Carey, the third generation Carey to lead the business
“We hope the flow of inbound trucks and inventory filling our warehouses helps to bring stability and confidence to the wonderful W&C employees, especially as we move into the holiday season,” says Goodman.
W&C is one of Canada's largest independent distribution and logistics companies and had about 7,000 customers, including then-Greenergy (acquired by Global Fuels this summer) in addition to 7-Eleven Canada in Western Canada. At the time of its creditor protection filing, W&C had a fleet of 120 leased trucks and trailers and leased warehouses in nine cities across B.C., Alberta, Manitoba, Saskatchewan and Ontario, supplying some of the country’s most remote communities and to thousands of independent stores.
The assets purchased are for 7-Eleven’s own operations, says Goodman, but “we are conducting a strategic review to determine our ability and interest to service customers other than ourselves.”
Wallace & Carey also owns Loudon Bros. Ltd., a distributor servicing Northwestern Ontario, which has 500 customers, including Lactalis Canada Inc. and Labatt Brewing Co. Ltd. Loudon Bros. will continue to operate independently of this deal.
As for whether the deal will result in any staffing changes—W&C had about 650 full-time employees at the time of the June CCAA filing—Goodman says, “We value the knowledge and expertise of all employees throughout the W&C organization” and “during the transition period, all W&C personnel decisions will be made by the W&C leadership team.”
He also adds, “As we work our way through the transition service period, we hope that current W&C employees are excited about the prospect of potential future opportunities to become part of the 7-Eleven team.”
CSNC also contacted Pat Carey. He has confirmed a written comment is forthcoming this week.
Barry Prentice, director of the Transport Institute and a supply chain management professor at the University of Manitoba, says 7-Eleven purchasing a wholesale company will give it vertical integration, which comes with two big advantages.
“First, ability to control your costs, which may come with size economies in purchasing. Second, reliability of a proprietary supply chain is more assured,” explains Prentice. “Of course, all this depends on firm’s network economies. 7-Eleven Canada may be at the size where it makes sense to bear the costs of its own distribution channel. The density of stores in Alberta and BC could make this a smart managerial move.”