Performance Food Group Company (NYSE:PFGC) Q2 2023 Earnings Call Transcript

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George Holm: We don’t have a good feel with that. I mean, I guess the only thing that we get is the complaints from customers around fill rates have gone down and gone down a lot. Our Foodservice were almost back to normal, very close. Core-Mark and Vista are still struggling more with inbound. And what I look at because it’s hard to judge in this type of environment has been hard to judge is what our inbound rate is versus our outbound. And are we converting the inbound to a better outbound at kind of a percentage standpoint what we used to when the supply chain was normal and we’ve been able to do real well there. So I would say that we’re probably at least at a par with the industry. I think it helps, too, that we are purchasing people at each of the distribution centers and they’re really tied tight to the sales force and many of the customers, particularly the larger customers and I think that’s helped us.

Operator: We’ll take our next question from Lauren Silberman with Credit Suisse. And it looks like they have removed themselves from the queue. We will take our next question from Andrew Wolf with CLK .

Andrew Wolf: I just wanted to ask you to perhaps tell us a little more about your views and outlook on labor productivity. So what I’ve heard from, what you’ve been saying, George, it sounds like labor costs are coming down. Maybe on an hourly rate as you substitute in sort of normal labor for some of the expensive labor you’ve had to beer. But what is the — what are the trends looking like with labor productivity, given it sounds like you might be early on still training people. And what is the outlook for labor productivity? And where does it need to improve more? Or is it more of a — it sounds like it might be more of a still a warehouse issue than a delivery which sounds like it’s improving more rapidly.

George Holm: Well, it needs to improve everywhere but I’m going to kick that one to Pat. He’s closer to it.

Patrick Hatcher: Yes. I mean it’s a good question. As we talked about a little bit earlier. I mean, what I’ll expand upon my previous answers, just we have some great systems in place. So once we get the people into the warehouse, once they’re trained, we have great systems to allow them to be very — have very efficient productivity. What I mentioned earlier is it’s a retention thing and this is, I think, it’s not a PFG issue, it’s a broader industry issue but we are starting to see some really nice progress, as I mentioned earlier. So — the team is doing an excellent job of recruiting and getting those folks into the buildings, getting them trained. And again, we think that over time, this is really going to become more of a tailwind.

Andrew Wolf: And sort of as everybody’s until recently been using 2019 or actually still using 2019, as a metric. If you look at sales productivity, are you also doing that some kind of pre-COVID normal for labor productivity? And — can you give us a sense of how that curve is going to look in terms of the improvement over the next year?

Patrick Hatcher: Yes. I mean, we absolutely look at pre-COVID numbers as well, just to make sure that we’re measuring to what was, what we’ll call, a sense of normal back then? And then how does that compare to stay. I can’t give you any indication of how quickly we’ll move down that curve because, again, it’s just — there’s so much uncertainty around labor but it’s something we’re very focused on. I can tell you that.

Operator: And we’ll take our next question from William Reuter with Bank of America.

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