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This time it's certain: United Grocers is pulling out of Medford

by PAUL MACOMBER

United Grocers has decided to close its Medford grocery and deli warehouseoperations after all.

The closure is expected to save the Portland-based grocery wholesaler$47 million over the next 10 years, said Jim Schuh, Medford warehouse manager.

The company announced plans to close the operation two years ago to consolidateoperations in Portland and California.

But a change in management and plans to merge with Seattle-based AssociatedGrocers a move still being studied - led the company to reconsider the decision.

The decision to close wasn't close. The facility group said itwas pretty conclusive that we need to close, Schuh said.

The company Friday notified its 200 Medford workers of its plans to proceedwith the closure. As already planned, about 30 percent of the business servicingCalifornia accounts will be shifted away during the week of Oct. 5-11. Thesecond phase will transfer the balance of operations in January.

Everybody has a job if they choose to move north or south,Schuh said. Nobody's going to be displaced.

About two-thirds of the work will go to California and one-third to Portland,he explained.

The company will keep a presence in Medford, including a produce anddairy function. Some cross-docking - handling material destined for theother terminals - will also be included.

We're trying to put together a program for Medford that's goingto be profitable, Schuh said. We may increase some of our refrigeratedarea.

Schuh said the number of jobs that remain in Medford depends on the numberof activities that remain here. He guessed there may be enough work forabout 20 people.

We spent a substantial amount of money to re-evaluate this decision,he said. I put together a lot of numbers and lots of reports hopingwe'd come up with ways to keep this open.

The company does not plan to sell the Medford warehouse, at 2195 SageRoad, which includes 250,000 square feet of storage. It had been offeredfor sale for $6.5 million when the closure was first announced.

Talk of closing the Medford warehouse was sparked by United Grocers'acquisition of Market Wholesale in 1995. That company had warehouses atSanta Rosa, Tracy, and Modesto, Calif.

United Grocers will consolidate its operations in Portland and Tracy.

Associated and United Grocers are both among the nation's 10 largestretailer-owned cooperatives. United Grocers is slightly larger, with annualsales of some $1.3 billion and more than 2,000 employees. The company has1,600 workers in the Portland area and has had up to 350 in Medford.