US wine major E&J Gallo is to close its California-based distribution operations, handing its shipping to retail chains to Texas firm Republic National Distributing Company (RNDC).
The move will result in layoffs at the company’s Gallo Sales Company subsidiary, with 355 workers set to be affected across seven facilities in the state, according to the San Francisco Business Times.
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According to layoff notices filed to the state by the company and seen by the Business Times, 93 employees will be cut at its 68,000-square-foot Hayward warehouse facility, while 23 will be laid off in Modesto.
The California sites affected will reportedly close on 1 March.
However, in a statement, E&J Gallo said only 290 staff members were impacted by the move. A spokesperson for the firm told Just Drinks: “Gallo Sales Company is optimistic that the majority of employees will have the opportunity to interview and be offered similar opportunities with RNDC. Employees may also apply for roles at E&J Gallo Winery.”
RNDC announced earlier this month it had been awarded E&J Gallo’s retail chain distribution business in California, adding to the general market retail distribution business the company took over for the Barefoot wine brand owner in 2021.
“We are thrilled to be Gallo’s distributor in California,” Bob Hendrickson, RNDC COO said in a statement at the time. “Our successful partnership and route-to-market capabilities have been key in making this next phase of our relationship happen.”
Ted Seburn, vice president of sales for E&J Gallo, added: “RNDC has been a great distributor for Gallo brands nationally, and we look forward to expanding our relationship with them as we transition our chain business in California.”
E&J Gallo is the US’ largest wine producer by volume and its portfolio also includes brands such as André. In March last year, the group set up a dedicated spirits division to house 24 brands including New Amsterdam Vodka, Camarena Tequila and RumHaven.
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