AGRILINK FORGES TENTATIVE PACT WITH GATX

AGRILINK FORGES TENTATIVE PACT WITH GATX

Continuing on its outsourcing course, AgriLink Foods Inc. has inked a tentative pact to have GATX Logistics Inc. handle its freight management, packaging and labeling as well as distribution support services at its Michigan warehouse.

Under the arrangement, GATX is buying the huge 400,000-square-foot Coloma, Mich., distribution center belonging to Curtice Burns, a business unit of AgriLink, for an undisclosed sum. No other details of the pact were divulged.Most of the 190 people working at the facility will become GATX employees, said Bea Slizewski, an AgriLink spokeswoman.

It's the second time in about seven months that AgriLink has sold off a warehouse to a company specializing in warehouse and distribution management.

Last summer, the Rochester, N.Y., processed-foods maker sold its Montezuma, Ga., distribution center to URS Logistics, which then began overseeing distribution of products made at an adjacent plant, Ms. Slizewski said.

Such moves are nothing new in manufacturing.

In recent years, scores of companies have outsourced facets of their operations, such as payroll, information technology, transportation and warehousing, to specialists in those fields.

All the better to focus their attention, energies and investment on their core business, observers said.

''We make food, that is our core competency,'' Ms. Slizewski said. ''We don't operate warehouses. So we got someone who knows what they're doing and we're using their expertise. This way, we can get back to doing what we best.''

If the contract is approved, GATX will end up overseeing the distribution of work-in-process and finished product to and from Curtice Burns plants in and around Coloma.

This means GATX Logistics will be a single-source supplier for Curtice Burns' warehousing and transportation needs in Michigan, a spokesman said.