It Dublin-based fresh fruit and vegetable supplier Keelings has won
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a contract to distribute all Tesco's chilled, fresh and frozen foods throughout Ireland.
The company beat off 10 other Irish and international operators to win the lucrative contract, which was put out to tender in late 1998. Keelings has been a supplier of fresh product to Tesco both in the UK and Ireland for more than 10 years.
Tesco Ireland now plans to invest 1r£20m in building a new multi-temperature warehousing facility in Ballymun, near the M50 in Dublin, which will be managed by Keelings. From there, Tesco will service its Republic of Ireland supermarkets with 150 multi-temperature trucks, carrying up tolr£700m worth of food products a year.
The deal marks the final phase in Tesco Ireland's strategy to consolidate distribution to its stores from within Ireland. 1r£5m was spent upgrading its Tallaght (Dublin) depot for fast-moving goods, and Exel Logistics has been awarded the contract to consolidate and distribute nonfood and slow-moving grocery goods.
Once the new distribution centre is fully operational, by mid-2001, Tesco will distribute 95°/o of goods from its con solidation depots, compared with 55% currently and just 5% two years ago.