Eby-Brown Focuses on Growth, Long-Term Strategies

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Eby-Brown Focuses on Growth, Long-Term Strategies

By Melissa Kress, Convenience Store News - 03/04/2016

NAPERVILLE, Ill. — Eby-Brown Co. LLC is taking steps to expand its reach into states east with its pending acquisition of Liberty USA. It's a deal that will bring together two family businesses.

West Mifflin, Pa.-based Liberty is the largest independently owned convenience store supplier in Pennsylvania, servicing more than 1,000 customers. It was founded by Francis "Red" McGuirk and his wife Patricia in 1959.

Naperville-based Eby-Brown is the largest family-owned wholesale consumer products distributor in the convenience store industry. It was founded more than 125 years ago.

"We've known and admired the McGuirk family for years. We admired the fact that they have a strong company. They built up a multi-generational family business and we felt it was the appropriate time to merge the two family businesses into one to provide the best possible future for our customers and their employees," Thomas Wake, co-president and co-owner of Eby-Brown, told CSNews Online.

That future now includes new markets — New York, Maryland and Delaware — and new customers in Pennsylvania and eastern Ohio, all which will be serviced by Liberty's base, just outside of Pittsburgh.

"Liberty's service area is contiguous with our service area, so we are kind of in each other's backyards. Their distribution center gives us better efficiencies in serving our customers from both facilities that are contiguous," he said. 

Moving forward with the unification, Eby-Brown plans to initially keep the businesses operating as usual. 

"We don't want to change anything for the employees, and we certainly don't want to change the experience for our new customers either," Dick Wake, co-president and co-owner of Eby-Brown, told CSNews. "We are not going to do anything for a while, until we do more analysis and research to figure out exactly how Liberty does everything in its relationships with its employees and its relationships with its customers."

Eby-Brown estimates that it will begin the operational integration in six months to a year from now.

"We'll go through integration when we know what new things we have to do, or perhaps what things we have to create system-wise to mirror what they are currently doing, so our employees and customers don't experience any change when the actual transition does occur," Dick Wake added.

Once the transaction closes, Gary McGuirk Jr. will remain the general manager of Liberty, which will operate as Liberty USA, a division of Eby-Brown.

"We feel Liberty USA will fit right into the Eby-Brown culture. This combination of two great family businesses will yield excellent results for our customers, team members and trading partners," McGuirk said.

Opening Up to New Markets

Eby-Brown previously had a distribution center in Baltimore; however, the company closed that facility several years ago. Currently, the wholesaler maintains distribution centers in Eau Claire, Wis.; Montgomery, Ill.; Ypsilanti, Mich.; Springfield, Ohio; Plainfield, Ind.; and Rockmart, Ga.

Today, Eby-Brown reaches the greater Pittsburgh market out of its Ohio facility, but it's a four-hour stretch. The Liberty acquisition will change that.

In addition to opening up new markets, and hence new customers, the deal is expected to spread Eby-Brown's reach across all-sized retailers.

"We're unique in that we can take care of the national convenience retailers and provide them with the services they need, and [we] have customized solutions for the mid-sized and large chains also. We also have a very special focus on the independents," explained Thomas Wake.

Liberty's focus historically has been, based on the company's size and geographical limitations, on the mid-size to smaller chains and the independents.

"They've done a tremendous job with those accounts. We're excited about having them join our family of customers," he said. "But we are certainly open to all sizes and variety of styles of retailers."

Eby-Brown built its business a generation ago on the needs of the independent retailer. As chains began to form, the company developed that expertise.

"As chains became greater in size, complexity and the services they required changed, we adapted to that as well, without turning our backs on anything historically," Thomas Wake noted.

More Acquisitions to Come? 

With today's convenience store industry active in merger-and-acquisition activity on both sides of the supply chain, Eby-Brown is always looking to expand, according to its owners.

"There are a lot of great businesses in this industry, particularly family businesses. We've always been looking at and talking with other people, for years," Dick Wake said. "Sometimes, the time isn't right when we first speak to somebody. For instance, we have spoken with the McGuirk family for several years, and other people as well."

In regards to expansion, the company leaders revealed that Eby-Brown is interested in moving toward the northeast, east or south.

"We're interested in combining other family businesses with our family business down the road, if the conditions are right and people are willing to sell," Dick Wake explained.

Looking at a map of Eby-Brown's distribution centers with the addition of Liberty USA, the company will now have service reach across the eastern half of the United States, except Florida. The wholesaler previously had a presence in the Sunshine State with service to Speedway LLC and Sunoco Inc.; however, the state of Florida is not currently top of mind.

"It's not a place we're opposed to going back to, but it's the type of market — both retail and wholesale — that if you don't have an established business, it's very difficult to garner new business," Dick Wake said. "And unfortunately, there are no family [distribution] businesses in Florida, nor is there anyone at this point in time that could be acquired.

"We never say never, but that's probably not in our plans. Just about every other place in the eastern half of the country, except Florida, would probably be in our plans," he continued.

There are a large number of distribution companies, "all great family businesses," in Eby-Brown's existing marketing areas, Thomas Wake added. 

"We're very interested in joining together any number of convenience wholesalers that are operating in our backyard," he said. "It's a big small industry. We really do know everybody. But it's a matter of when is the right time and when do the stars align that it makes sense for the customers, as well as the owners and operators of these convenience store distribution companies."

Long-Term Goal

Growing its service footprint is not the only strategy Eby-Brown has for future growth.

The company's "long-term goal is to maintain its focus on delivering superior customer service, while continuing to invest in solutions that will provide opportunities for our customers to be more profitable," according to the executives.

To date, the company has made sizeable investments in its technology and infrastructure to provide "best-in-class," industry-leading differentiators for its customers over the long term. These include:

  • Mobility Applications: Seamlessly connect Eby-Brown with its customers and vendors to drive real-time decision making and provide greater efficiencies. 
  • Smart Process: Provides category management expertise and unparalleled execution, which guarantees more profitable solutions for its customers.

Foodservice will also continue to be a primary focus for Eby-Brown over the long term. The company said it will continue to invest heavily in both the physical asset and the human asset components of foodservice.

As part of this focus, Eby-Brown created a Food Lab at its corporate office. It is headed by a chef who conducts research into new foodservice opportunities, while providing food tasting and training for its customers.

In addition, the company has invested in dedicated foodservice experts in each of its plants, who work directly with customers to identify and develop foodservice opportunities.