Sysco Corporation is an American multinational corporation involved in marketing and distributing food products to restaurants, healthcare and educational facilities, hotels and inns, and other foodservice and hospitality businesses. The company is headquartered in the Energy Corridor district of Houston, Texas.
Headquarters of Sysco in the Energy Corridor
|Headquarters||Houston, Texas, United States|
Number of employees
Sysco, an acronym for Systems and Services Company, is the world's largest broadline food distributor; it has more than 500,000 clients in a wide array of fields. Management consulting is also an integral part of their services. As of July 2, 2017, the company operated over 300 distribution facilities worldwide.
The company was founded by Herbert Irving, John F. Baugh and Harry Rosenthal in 1969. The company became public on March 3, 1970. On July 20, 2009, Fortune magazine ranked Sysco No. 204 in the annual Fortune 500 companies in world based on sales volume. On May 3, 2010, Fortune ranked Sysco as the 7th largest Fortune 500 Company in Texas and 55th largest in the U.S. by total revenue. Sysco is also the largest non-oil related company in Houston and the third largest non-oil related company in Texas (Behind AT&T and Dell).
Sysco competes with national distributors US Foods, Performance Food Group, and Edward Don & Company, as well as regional companies such as Gordon Food Service, Ben E. Keith, Maines Paper & Food Service, and local foodservice distributors.
In December 2013, Sysco announced an $8.2 billion planned acquisition of its next-largest food distribution rival, US Foods. After a U.S. federal judge ruled that the combined company would control 75 percent of the U.S. food service industry, Sysco terminated its merger with US Foods.
In 2003, Sysco purchased Asian Foods, the largest Asian foods distribution in North America. The first group of Asian Foods joined Sysco Kansas City in 2006, followed by Asian Foods Chicago joining Sysco Chicago in Sep, 2009.
In 2009 Sysco acquired Pallas foods, the largest food distributor in the Republic Of Ireland. Continuing the expansion of their Irish offerings, in 2012 Sysco purchased Crossgar Foodservice for an undisclosed amount.
On December 9, 2013, Sysco announced they would acquire US Foods for a total of $3.5 billion. But in June 24, 2015, US Federal Judge Amit Mehta ruled that the combined Sysco-US Foods would control 75% of the U.S. food service industry and would stifle competition. On June 29, 2015, Sysco terminated its merger with US Foods.
The SYGMA Network, Inc. is a wholly owned subsidiary of Sysco that provides food and non-food products to chain restaurants throughout the United States.
SYGMA was founded in January 1984 when senior officers of Sysco Corporation started discussions for forming a new distribution company. The first products were shipped in May 1985 from SYGMA’s first distribution center in Oklahoma. In 1988, Sysco acquired CFS, increasing head count at the organization.
SYGMA's customers include approximately 16,000 restaurants representing 27 concepts. Operating from 15 distribution centers, SYGMA is one of the largest chain distributors in the United States with sales over $6.7 billion. 191 million cases of product are delivered each year. SYGMA currently employs over 4,000 employees.
iCare partners include:
In December, 2004, SYSCO announced that Gregory E. Otterbein had been named president and chief operating officer of Sysco Food Services of Northern New England, Inc., succeeding current president Richard A. Giles.
In 2005, Thomas E. Lankford retired as president and chief operating officer after a 41-year career in the foodservice distribution industry. Richard J. Schnieders, SYSCO's chairman and chief executive officer, assumed the additional role of president.
The company is governed by a board of directors. Current members of the board are: John Cassaday, Judith Craven, Jonathan Golden, Joseph Hafner, Richard Merrill, Nancy Newcomb, Richard Schnieders, Phyllis Sewell, John Stubblefield, Richard Tilghman, and Jackie M. Ward.
Scandal regarding unrefrigerated drop sitesEdit
Beginning in the Summer of 2013, the California Department of Public Health was investigating a total of 21 sheds which were never regulated with the state of California and never inspected. This food included overnight drop-offs of chicken, pork, beef, bacon, and milk. An investigative report by NBC Bay Area recorded food sitting in these sheds for up to five hours, in temperatures as hot as 81 degrees Fahrenheit, before the food was delivered to hotels and restaurants. An employee speaking anonymously stated that sheds in Spokane, Washington, had refrigerators which were not large enough, and that most of the time there were cases of frozen food sitting on the floor outside the refrigerators.
In an essay, logistical consultant David K. Schneider stated, “I think it was a combination of cost control and misguided customer service. Yes, in an effort to do a better job serving the customer, the local operations cut cost corners,” with the result that food was left unrefrigerated for “hours” and people probably did get sick.
A Sept. 6, 2013 Sysco press release stated that “drop sites were locations that permitted Sysco to meet the service needs of our customers by allowing delivery associates to drop off product at locations for temporary storage. Salespeople would then pick up the product and transport it to our customers.” This press release also stated that Sysco had “decided to discontinue its drop-site program across the U.S. and Canada” after the company conducted an internal investigation into the practices and “identified additional operating companies that were not fully complying” with Sysco’s drop site policies.
On July 16, 2014, Sysco agreed to pay fines totaling $19.4 million in California and admitted to the allegations made by the NBC Bay Area news team and investigated by the California Department of Public Health.
- Sysco (SYY) annual SEC income statement filing via Wikinvest
- Sysco (SYY) annual SEC balance sheet filing via Wikinvest
- "Land Use and Demographics." Energy Corridor District. March 2009. 3 (7/53). Retrieved on January 16, 2010.
- "Fortune 500 2010: States: Texas Companies". CNN.
- Some independents eager to take bite out of Sysco, The Deal Pipeline, William McConnell, April 3, 2014.
- Gara, Antoine (June 29, 2015). "Sysco Cancels $8.2 Billion US Foods Takeover In Big Antitrust Win For FTC". Forbes. Retrieved October 1, 2015.
- Hassel, Greg. "Sysco goes to court vs. RioStar/Chapter 7 sought for Ninfa's parent." Houston Chronicle. Friday October 18, 1996. Business 1. Retrieved on February 6, 2012.
- Jones, Kristin. "Sysco Buys Crossgar Foodservice, Pushing Irish Expansion". Wall Street Journal. Archived from the original on June 17, 2012. Retrieved 15 June 2012.
- "Sysco Cancels $8.2 Billion US Foods Takeover In Big Antitrust Win For FTC". Forbes. June 29, 2015.
- "Sysco Terminates Merger Agreement with US Foods". June 29, 2015.
- "Otterbein to become President and COO at Sysco Food Services of Northern New England, Inc" (PDF).
- "Thomas E. Lankford Retires as President & COO of SYSCO; Chairman & CEO Richard J. Schnieders to Assume Additional Role".
- "Sysco// Investors//Corporate Governance//Board of Directors".
- UPDATED: Unrefrigerated storage prompts Sysco investigation, The Packer, Mike Hornick, July 15, 2013.
- Sysco Food Corp. Employees Claim Food Sheds Commonly Used Throughout U.S. and Canada, NBC Bay Area, Vicky Nguyen, Kevin Nious and Jeremy Carroll, Sept. 18, 2013. " . . Employees from coast to coast say that all of these sheds were hidden from health officials and never inspected. . "
- Province, feds investigate Sysco food distribution, Brantford Expositor (Toronto Sun), Shawn Jeffords, Sept. 14, 2013. " . . The sites, which Sysco abruptly stopped using across North America earlier this month, were used to store food products destined for tables in restaurants, school cafeterias and nursing homes. . "
- CFIA probing improper storage of meat, dairy by Canada-wide distributor, The Observer (Toronto Sun), Shawn Jeffords, Sept. 8, 2013.
- Sysco Sales Drop Sites Exposed, We Are The Practitioners website [a largely in-house publication with three principals from the David K Schneider & Company and about seven other writers], David K. Schneider, Aug. 12, 2013.
- Sysco Corp. (6 September 2013). "Sysco Strengthens Its Commitment to Food Safety; Drop Sites Eliminated Across the U.S. and Canada". Houston, Texas: Sysco Corp. Retrieved 6 July 2016.
- "Sysco takes steps to improve food safety after California incident".