AC HUMKO LAUNCHES ON CHEP PALLET PROGRAM WITHOUT TRIALS, FIRST PRIVATE LABEL OIL PRODUCER.

PARK RIDGE, N.J.--(BUSINESS WIRE)--January 15, 1996--AC Humko Corporation, a leading private label manufacturer, has launched the Chep USA pallet pooling system at its production and distribution facilities in Jacksonville and Champaign, IL. Supermarket chains, wholesalers, discounters, club stores and other participating distributors can now order shipments on Chep pallets.

Memphis, TN-based AC Humko, is producing its private label vegetable oil, shortening and non-dairy creamer lines directly onto Chep pallets. The company was confident enough of the potential cost savings that no test trials of the pooling program were held prior to implementation.

"We decided that if 85 percent of our customer base wanted us to deliver on Chep pallets, we would commit fully to the program. We found that more than 90 percent of our customers wanted delivery on Chep, so we made the move immediately," said Dan Antonelli, President and Chief Executive Officer, AC Humko. "We consider Chep pallets as a strategic move our company is making to benefit our customers, and we believe it will ultimately remove costs from the entire distribution channel."

AC Humko had previously used a captive pallet system in which product was loaded onto one pallet at the point of production and then was trans-loaded to a second pallet for exchange at the point of dispatch. The double handling was inefficient. With the Chep program, product is placed on a Chep pallet at the point of production and the load isn't touched until it gets to the distributors warehouse.

"AC Humko and Chep worked together to plan the conversion from the captive pallet system," stated Alan Cooper, Vice President of Operations, AC Humko. Cooper added that the implementation of the program has gone exceedingly well, meeting all expectations.

Chep USA executives view the move by AC Humko to launch the Chep program at the point of production without trials as proof of the system's inherent benefits .

"We have long held the belief that there is value in launching the Chep system for all levels of grocery manufacturing, and the launch by AC Humko, combined with the initial results, show that benefits are achieved very quickly," added Cliff Otto, Senior Vice President, Chep USA-Midwest.

"We further believe that visionary manufacturers like AC Humko will get the biggest boost as a result of their swift implementation of the Chep program. Now, AC Humko's competitors will have to play catch-up with their delivery alternatives." AC Humko Corporation, formerly the Specialty Oil Division of Kraft Food Ingredients, is a supplier of store brand shortening, oil and non-dairy creamer products to the retail trade. AC Humko has pioneered many firsts for its segments including use of the pull tab for oil, the rectangular oil bottle and shortening sticks.

Chep USA operates a national pallet rental company servicing grocery and foodservice manufacturers and distributors, mass merchandisers, warehouse clubs, and the produce and frozen food sectors with high quality pallets from more than 169 depots located throughout the U.S. Chep pallets are dispatched from more than 2,600 manufacturing shipping locations to more than 5,900 distributor receiving locations representing more than 90 percent of the dry groceries marketed in the country. Chep USA is part of the worldwide CHEP organization, which operates in 17 countries on five continents and controls more than 63 million pallets.

CONTACT: Steve Robinson 

Group Director, Retail Trade

AC Humko Corporation

800/691-1106

or

Gary Garkowski

VP-Marketing

Chep USA

201/391-8181

or

Ronald Margulis

Managing Director

RAM Communications

908/232-3230