Supplier awarded three-year procurement BPO contract by Pinnacle Foods

Supplier awarded three-year procurement BPO contract by Pinnacle Foods

Consumer products company Pinnacle Foods Group has awarded a three-year procurement business process outsourcing (BPO) contract to ICG Commerce.

Services to be provided through the contract by ICG Commerce include source-to-contract support across a range of categories, the largest of which is logistics, also including advertising, capital equipment and material release order (MRO).

Rachael Stormonth vice president at analyst, NelsonHall commented: “This contract, which commenced last October, is not a competitive win: Pinnacle Foods is owned by private equity funds controlled by the Blackstone Group

, who gained ICG Commerce an entry into Pinnacle Foods for a logistics sourcing services pilot. This work evolved into a wider supply chain network optimisation exercise, and then new spend categories were added.

Key test, reference client

“Nevertheless, Pinnacle Foods has a number of household brands (the newest acquisition, currently, being finalised, is Bird's Eye) and will provide a useful client reference for ICG Commerce's capabilities in serving consumer products organisations, and also in providing 3PL sourcing services. Last August ICG Commerce formed an executive advisory board for consumer packaged goods (CPG) organisations as part of its drive to pursue opportunities in this sector (where its major CPG sector clients include Kimberly-Clark and Chiquita Foods).

“The deal reflects ICG Commerce's attempts to win procurement BPO business through channel partners. However, while Blackstone Group has provided it with an entry, ICG Commerce is discovering that it can be challenging to win significant outsourcing business in this kind of situation.”