Scott Craig - Delhaize America Mark Lyktey and Jason Gintert - PepsiCo Warehouse Delivered

2. Improve Store In-Stock Rates Customer Demand Driven Replenishment Reduce Overall Inventory Reduce Supply Chain Costs Scott Craig - Delhaize America Mark Lyktey and Jason Gintert - PepsiCo Warehouse Delivered January 2012

3. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

4. Customer Demand Driven Replenishment Supply Chain Big Bets • Business Benefits (Source: Retail Solutions, Inc) • 12% To 27% Lower DC Inventory • 21% To 77% Decrease In DC Out Of Stocks • 20% Decrease In Store Level Out Of Stocks • Delhaize Piloted Program With Another CPG Vendor • Forecast Accuracy Improved By 30% • Met Or Exceeded All Goals • Estimated Inventory Reduction 30% • Predecessor - Rapid Replenishment • Upside Includes Increases In Stock, Reduces Reclaim, Etc. 4

5. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking Year on Year Inventory Tracking

6. Case Study Defined What is standard VMI: Upstream Supply Chain Pilot Vendor Managed Inventory (VMI) Food Lion Warehouse Food Lion Store Pepsi DC Pepsi Plant VMIPilot Goals - Penetrate to Store • Increase Store In- Stock Rates by 0.75% • Decrease Food Lion overall Inventory by 5% • Reduce Supply Chain Costs by 0.5%

7. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

8. POS Impact Customer Replenishment Planning Pilot Food Lion Warehouse Food Lion Store Pepsi DC DC to DC 1 day • Store to DC every 2 to 4 days POS identifies trends 3 days faster Headlines: • POS accelerates customer demand visibility to the manufacturer • Able to react within the promotional period • Provides a better more accurate demand signal that can be leveraged through the Supply Chain

9. POS Promotional Sales Growth Net Gain: Promotional Event Oversell In Stock Efficiency Total Day 19 Day 16 Day 13 Day 10 Day 7 Day 4 Day: Day 1 100% Planned Delivery 50% 30% 20% Event POS Overselling 111% Actual Delivery 50% 20% 30% 110% +10% • Headlines: • Sales Growth through higher in-stock • Customer Demand Driven Replenishment based of POS • POS data yields information to support decisions

10. POS Inventory Efficiency Promotional Event Undersell Inventory Efficiency Total Day 19 Day 16 Day 13 Day 10 Day 7 Day 4 Day: Day 1 100% Planned Delivery 50% 30% 20% Event POS Undersell 57% 15% Actual Delivery 50% 5% 70% • Headlines: • POS data yields information to support decisions • Inventory Efficiency • Fewer Returns/Expired

11. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

12. Store Inventory Effect Customer Replenishment Planning Pilot Food Lion Warehouse Food Lion Store Pepsi DC • X Days total network • Y Days Warehouse Goal • Y - 2 days • X - 2 days VMI Ship • X + 2 days • Y - 2 days • Z + 4 days Pilot

13. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

14. Customer Demand Driven Replenishment Pre-Pilot Conventional VMI Pilot Data Enhanced VMI Pilot Goals • DC Inventory • DC Inventory • Customer • Demand • Driven • Replenishment • (CDDR) • Sales Growth • Inventory Efficiency • Enhance replenishment • Enhance promo forecast • DC • Customer • Replenishment • Forecast • Store Inventory • Forecast DC Warehouse Withdrawals DC Warehouse Withdrawals • Safety Stock • Safety Stock • POS Headlines:

15. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

16. Q2 Inventory Tracking Q2 Distribution Center Inventory Reduction 32.24% April June May

17. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

18. 2010 vs. 2011 Results by Period Store In Stock 2.05% Point of Sale 20.9%

19. 2010 vs. 2011 Results by Period DC on Hand 15.5% Reclaim 0.5%

20. Agenda Supply Chain Big Bets Case Study Defined POS Impact • Store Inventory Impact Customer Demand Driven Replenishment Q2 Inventory Tracking Year on Year Inventory Tracking What’s Next

21. What’s Next Goals • Jointly Grow Sales • Improve Inventory Utilization • Increase Collaboration • Anticipate Customer Demand • Build Efficiencies Expansion • Q2 2012 • Expand automated processes • Roll Out to all Delhaize lanes • Measure & Publish Results Collaboration Automation • Q1 2012 • Apply automation & enable EDI 830 • Enhance Processes • Perfect on Food Lion Gatorade lanes Proof of Concept • Q2, Q3 & Q4 2011 • Manually perform Customer Demand Driven Replenishment • Enhance Processes • Measure & Publish Results Blue Printing Demand Intelligence • Q1 2011 • Brainstorm VMI Enhancements • Manufacturer/Retailer jointly devise strategy