Transformation drives AmerCareRoyal to an industry leader

Since it was formed with the initial platform in 2014, AmerCareRoyal (ACR) has been on an incredible journey building scale and breadth to become an industry-leading platform.

Its products are consumed in every part of the North American foodservice industry, including large international restaurant chains, emerging regional organisations, local neighbourhood eateries, cafeterias, and institutional feeders, and the broadline and supply distributors that serve them all.  Major brands like Five Guys, Tim Horton’s and Yum Brands, and hundreds of other brands that operate and distribute to restaurants trust ACR as a single-stream resource for over 6,000 disposable products used to keep their businesses humming. 

“We've transformed from a regional player to a leading national supplier of disposable products across 20 categories in the food service industry,” comments Brett Barnello, ACR’s Chief Operating Officer. “We have unmatched infrastructure and product breadth. We have over 6,000 product SKUs. We're roughly a billion in revenue today, and we have an aspirational growth plan to triple that to be at US$3bn in five years or so.”

As Jeff DeSandre, ACR’s Chief Information Officer, describes, what is particularly notable about the organisation is that it is greater than the sum of its parts.

“If you add up the nine acquisitions that we've made to form ACR, they equate to less than our current revenue,” he explains. “The work that's being done here allows for synergising. There is a large portion of organic growth that's part of this acquisitive growth and I think that's pretty interesting that the sum of the component parts is less than what we are today.”

The COVID-19 pandemic and unprecedented supply chain challenges

The COVID-19 pandemic caused well-documented disruption on a global scale, with ACR’s supply chains no exception. ACR leverages domestic manufacturing and international sourcing, which amounts to a truly global supply chain, so it was greatly impacted by the pandemic. 

However, as Barnello points out, the company's supply chain issues were not solely pandemic-induced. In fact, ACR was already grappling with growing pains in the pre-pandemic period. As Barnello states, these challenges involved stitching a number of small business units together and linking those and creating synergies.

“The pandemic was another in a series of this unprecedented global supply chain disruption and how we fare and manage through that,” he explains. “Then, the challenge was to not only survive the day-to-day of the pandemic, but actually also on a separate track start to think beyond the pandemic and how we come out stronger and more stabilised.

“We knew everyone would come out of the pandemic at the same time, but some would be worse off than others. For us, our goal was to be stronger and have corrected systems and processes and different people capability.”

ACR’s transformation

As DeSandre describes, ACR’s transformation began with the transformation of its leadership team, with an end goal of creating a solid bedrock upon which to build.

“I had to make sure that the foundation was right. That meant no noise, and making sure the table stakes worked,” DeSandre explains. “It's like the gutters on a house. No one notices them if you put new gutters on, but they do notice if they don’t work.”

As a result, ACR worked with OpenSystems on a fully-managed, SASE (secure access service edge) SD-WAN solution. “That was a foundation, and was one less piece of noise that I had to worry about,” DeSandre explains. “This technical foundation afforded us time to focus on other key digitization drivers including master data.”

As DeSandre explains, security is a continuous consideration. “We live and breathe considering security. We have to focus on that on a regular basis,” he comments.  With this in mind, ACR worked with OpenSystems’ Ontinue service, its managed detection and response (MDR) division, to help find problems in real-time. Its AI-Powered MXDR expertly blends the best of MDR, as well as assessment and prevention.

From there, DeSandre worked on developing ACR’s API layer, working with VAI - its ERP supplier - and its S2K platform. 

“Even though our ERP system may not be from one of the big suppliers, the architecture of the system, and the amazing partnership of VAI, has really enabled us to take deficiencies that might be in any ERP system and react really quickly.”

“The flexibility that comes with the S2K platform is really a differentiator for us, because it allows us to continuously optimise, especially in the warehouse, which is really important.”

The final piece was a trusted managed services partnership which afforded ACR strong technical resources which can be scaled up quickly.   For this ACR partnered with ProgrammersIO (PIO), which provides high quality global development resources.  “PIO provided us very technically sound resources to support the S2K platform.  The level of commitment and quality of their work is outstanding.  They are a key part of our IT team”, says DeSandre. 

With this foundation established, ACR could set its sights on future projects. Since the transformation got underway, ACR has worked on three major projects: Unity - its ongoing integration project; Spotlight - which focuses on commercial optimization; and Rubik – its Supply Chain continuous improvement initiative.

As Barnello explains, Project Rubik is part of ACR’s transformative initiative around its supply chain and back-end operations. 

“Rubik started with network design and optimisation as well as inventory management, and how we could become more efficient coming out of the pandemic,” he describes. “We had higher inventory levels, low service rates, and we had high back orders as well as splits, in terms of a customer receiving something from a different location on the same order and not at the same time - which was causing customer pain and complexity.”

As part of the strategy, ACR worked with its partners to develop a sustainable roadmap. “We put together a large cross-functional team that involved IT, Sales, Finance, and Operations and then executed that plan.”

Supply chain partners

As Barnello describes, ACR has worked with partners across its supply chain, including GAINSystems and 3GTMS transportation management systems.

GAINSystems is ACR’s planning partner that it utilises for supply and demand planning efforts, he explains, in a partnership over a number of years. “Not only are they being used for our planning software and all of the inventory and operating policies that go along with that, but they're also moving into network design as well,” Barnello comments. “We are seeing tremendous value in a single partner that has both the planning capability and the operating policies as well as the ability to help us design and run simulations and optimization.”

3GTMS, meanwhile, has provided ACR with visibility across its transportation network. 

“What they've really done is given us the visibility and the data to be able to effectively manage our outbound freight and understand where we're winning and losing and then really to chase that down,” Barnello adds. 

Importance of data and data visibility

When it came to looking at ACR’s data strategy, DeSandre emphasises the importance of a clean stream of master data which can be easily accessed in near-real time. This is where ACR’s partnership with global process mining technology leader Celonis came into play.

“Our work with Celonis really is at the heart of our data strategy, to the point now that we're really moving towards having all of our data in one place within Celonis. Today, we're just starting to tap that potential and I think the executive team is just starting to really understand the power of having that data model.”

An example of this success comes through ACR’s work with Emporix and Avatria on implementing a new Digital Commerce Platform, which enables its customers to utilise insights and ultimately deliver better outcomes.   The product is known as the 1ACR portal.

“We just went live with our new portal, and I'm happy to say that we don't have a point-to-point interface. Any information that we already know is clean, and is in Celonis, is being syndicated to our portal, which makes us very unique. We really are starting to get to a point where our transactional data is able to be syndicated and used in these different systems.”

As DeSandre explains, the ultimate goal is to achieve a single version of the truth with a low amount of manipulation. 

“There are still some shortcomings with not all required data being tracked in our master data as part of our ERP,” he adds. “To correct for this and enable change as ACR continues its evolution we have amended our ERP to support non-native master data allowing our ERP to serve as a system of record where necessary.”

A bright future for ACR

For ACR, which continues to grow through acquisitions, the message for the future is one of continued partnership. And through its projects - Unity, Rubik and Spotlight - the transformation will continue to evolve.

“I don't think it stops,” Barnello comments. “This is really a jumping off point for us. We'll continue to refresh the network as we continue to acquire new businesses, new geographies and new customers. We're turning to using data and the digital transformation on our spend cube and in our procurement space as well.”

As DeSandre concludes, the future will see ACR continue to drive innovation across its ongoing transformation projects.

“I really do feel like we're at a point of almost best of breed in our supply chain capability. But on our commercial processes, our pricing strategy, how we process rebates, bill backs, how we deal with the commercial aspects of our customers, I do think that we're probably still about a year or two away from being a best of breed there. So I think that's going to be a lot of our focus. 

“We have really strong leadership now, and so the future for me is really about continuing the great work that we've been doing for the last three years,” he concludes. “It's going to be about pulling it all together and continuing driving our supply chain optimization projects in Rubik as well as our commercial optimization projects in Spotlight.”