1. ALASKA’S FOOD SUPPLY CHAIN

2. HOW DOES IT GET HERE?

3. Purchase orders come into our Auburn warehouse to be cross docked and shipped north.

4. Order selectors in Auburn select some orders to be consolidated on trailers and shipped north.

5. Containers are delivered to the Port of Tacoma from our Auburn Distribution Center.

6. Horizon ships head north to Alaska on Wednesdays and Fridays 4 to 5 days

7. Anchorage 3.5 Horizon Ships arrive in Anchorage on Sundays and Tuesdays

8. Some containers are shipped via AML barge 10 to 12 days

9. Sometimes we get delays at sea: Alaska has some of the worst sea conditions on earth. In the winter, the ships can be hundreds of miles from port, in stormy seas, with ice forming everywhere, at times so thick it has been known to capsize boats. Storms cause many delays in shipping schedules and damage to product.

10. Delays at Sea: The Port of Anchorage has tidal changes that can vary as much as 40 feet from low to high tide. Knik arm has shoals (underwater hills) that will prevent the ship from docking if the tides (water level) are not high enough to allow the ship to cross over.

11. Port of Anchorage: The shoal on the sea bottom at the entrance to the port of Anchorage.

12. The State’s coastline, 33,000 miles in length, is 50 percent longer than that of the entire continental United States. The Gulf of Alaska has the 3 rd most dangerous storms in the world.

13. Sometimes we encounter delays after we get to Anchorage…

14. Finally it arrives at our Anchorage Distribution Center (DC). Note: This is the only produce distribution center in Alaska.

15. SHIPPING - Review Maritime options – Horizon or Alaska Marine Lines (AML) Remote store orders are billed out according to the schedule of transportation mode that will be moving their freight. Lead times vary from 6 hours to 2 weeks depending on shipping requirements. Considerations for shipments will include HAZMAT classification (which will vary if shipping via air, road, ship, etc.), road restrictions, highway weight restrictions, by-pass mail minimums, and temperature conditions.

16. 26 Corporate stores through-out Alaska Carrs/Safeway Stores

17. Shemya Shemya - 1485 miles SW of Anchorage Barrow - 722 mile North of Anchorage We ship to independent customers through-out Alaska… - As far north as Barrow and as far south as Shemya

18. Perspective: That’s like shipping to points on the west coast, east coast, northern states and southern states, from one DC. This creates challenges in maintaining product integrity and schedules.

19. Modes of transportation within Alaska include: Air Charter Service Railroad By-pass mail Road store delivery

20. Air Charter Service Boeing 737-400 Freighter Boeing 737-400 Combi

21. Freight is loaded into igloos and then put on a plane for shipment.

22. Railroad

23. By-pass mail By-pass mail is 4 th class mail that is delivered to bush communities as non priority freight and can take up to 2 weeks to get delivered. Bush communities are locations that do not have road access.

24. Container ship – to Kodiak Island and Dutch Harbor

25. Road store delivery

26. KFF service – “keep from freezing” These are insulated containers with heat coils in the walls to prevent product from freezing. Because sometimes, it gets cold!

27. Alaska’s Food Supply Challenge: The dynamics of shipping to and within Alaska will continue to be a challenge. It is imperative to plan around the seasonal swings: volume increases of 30 % or more between Memorial Day and Labor Day, snow still on the ground into April and the bugs long gone by mid September, and significant increases in items such as repack boxes during fishing season for the commercial boats and special orders for the fire fighters during high fire season. Alaska has anomalies unique to its climate that make it more challenging for everyone involved in servicing our stores.

28. QUESTIONS?

30. NOW… take this home – family/neighbors

31. END Contact information: stephanie.kennedy@safeway.com steve.neilson@safeway.com