Iowa Grocer Closes Central Food Facilities: Nearly 500 Workers Impacted

According to a report from KCRG-TV9, Hy-Vee is making a major change to how it prepares food for its stores. This will close three centralized production facilities across Iowa and impact nearly 500 employees.

Get our free mobile app

Two of the closures are in Central Iowa. A 150,000-square-foot food commissary in Ankeny and a 48,000-square-foot “Short Cuts” produce facility in Chariton have both shut down completely, affecting 332 and 129 workers, respectively. Operations at these locations ended on June 24th. The company has filed the required Iowa WARN notices and is offering impacted employees new roles within nearby Hy-Vee stores.

In Cedar Rapids, a regional bakery near the Eastern Iowa Airport is also ending production. About 60 employees were informed that the facility will no longer produce baked goods for distribution. Around a third of those affected are part-time. While the site will remain open for potential repurposing, production is ending, and all employees are being offered comparable positions at local retail stores.

The closures mark a shift away from Hy-Vee’s 2018 move to centralize food preparation in large-scale facilities. That effort moved tasks like making salads, sandwiches, and fruit trays out of stores and into production hubs.

However, transporting products from these central facilities to stores led to freshness and quality issues, especially for perishable items like produce and sandwiches.

By returning food prep to individual stores, the company hopes to deliver fresher meals and offer more ingredient flexibility. This also allows store staff to tailor food choices to local preferences and reduce delays caused by transportation. The company stressed in a recent interview that the closures were not driven by cost-cutting. Instead, they are based on customer feedback and a desire to improve freshness.