The distribution question
As the True Value bankruptcy case unfolds, the fate of the Chicago-based distributors’s distribution centers hangs in the balance.
There are 12 True Value DCs around the country, including two — Denver and Manchester, New Hampshire — that were marked for closure before True Value filed for bankruptcy.
True Value has delivered WARN notices to departments of labor in various states where True Value operates distribution centers. The initials WARN stands for Worker Adjustment And Retraining Notification, and the WARN Act is a law designed to give workers advance notice of potential layoffs.
The layoffs may be avoided upon successful completion of the Do it Best deal, but WARN notices have been filed, including in Hanover Township, Pa., where 269 employees are potentially affected, in Kansas City, where 69 employees would be affected, and in Kingman, Arizona, impacting 62 employees.
In an interview with Do it Best CEO Dan Starr last month shortly after Do it Best emerged as the stalking-horse bidder for True Value assets, Starr said Do it Best was interested in the True Value distribution centers.
“We’re already engaged in trying to optimize our own distribution network. So there's a lot of additional work that has to take place before we figure it out. But I do think we’re going to need their distribution centers,” he said.
Court papers show the highest volume True Value DC is the one in Wilkes-Barre, Pennsylvania, which had $215 million in sales in 2013. Do it Best operates a DC about 105 miles east in Montgomery, N.Y.
The two distribution centers closest to each other are in Ohio. That’s where Do it Best operates a distribution center in Medina, and True Value operates a DC in Cleveland, about 30 miles away.
The Cleveland DC was the subject of a True Value WARN letter to the Ohio office of Workforce Development.
“While we remain committed to successfully completing the Chapter 11 sale process, we are notifying you of actions that True Value may need to take if we do not close the proposed sale to DIB and identify other buyers who will both address the company’s debt and allow us to continue to operate as a going concern and avoid layoffs,” wrote Irma Quintana, senior VP and chief human resources officer of True Value Company.
Even if the Do it Best bid is successful, it's too early to know how the two distribution systems would work together.
Court papers show the second and third highest volume True Value DCs were those in Corsicana, Texas ($156 million in 2023) and Harvard, Ill. ($128 million). Corsicana is about 55 miles from Waco, where Do it Best operates a DC. Harvard is about 80 miles from Dixon, Illinois, the site of another Do it Best DC.
Other supply chain facts from the bankruptcy case filings: True Value sources approximately 75,000 products from an expansive network of more than 2,000 suppliers. In 2023, approximately 93 percent of products were purchased from domestic suppliers; 5 percent were purchased from suppliers in China; and the remaining 2 percent were purchased from suppliers in other countries.
