Sysco Corp. is doubling down on digital transformation initiatives — even as it reported a weaker-than-expected fiscal Q3, weighed down by weather disruptions and industry-wide foodservice traffic declines.
It’s focusing on sales enablement tools, online pricing agility, and fulfillment automation. While third-quarter revenue rose 1.1% year-over-year to $19.6 billion, it fell short of expectations by $448 million. Local case volume, a key driver of Sysco’s core foodservice delivery business, declined 3.5% as restaurant traffic fell sharply in February due to severe winter storms.
Despite these challenges, executives emphasized that Sysco is accelerating multiple digital programs aimed at increasing salesforce productivity, speeding up customer interactions, and improving order fulfillment through expanded warehouse capacity and smart pricing systems.
“One of the most impactful things we’re doing right now is giving our sales consultants more real-time decision-making power,” CEO Kevin Hourican said during the company’s Q3 earnings call. “Our new pricing agility initiative enables reps to match competitor pricing on the spot — without delay or back-office approval. That’s a critical edge in today’s value-focused market.”
The pricing agility initiative — still in pilot mode in select regions — aims to reduce friction in the customer ordering process and better arm sales reps with data-backed flexibility. Hourican said the rollout will scale nationally once the pilot meets margin protection and training criteria.
“This is all about speed to action,” he said, “while maintaining strong margin discipline.”
Sysco digital strategy in Q3
Digital transformation also extends to Sysco’s ordering platforms. As more customers transition to self-service ecommerce, the company is investing in:
- Backend systems and data infrastructure to support better cross-sell opportunities
- Smarter product recommendations
- Improved price transparency
Online ordering now plays a growing role in shaping buyer behavior and loyalty. But it also brings greater competitive visibility.
“Customers increasingly see multiple distributor prices side-by-side online,” Hourican said. “That means we must deliver value not just on product, but on ease of ordering, price competitiveness, and speed of fulfillment.”
To support this shift, Sysco continues to modernize its warehouse and delivery infrastructure. The company recently opened a new distribution center in Allentown, Pennsylvania, and is preparing to launch another in Tampa, Florida. These facilities will expand fulfillment capacity, particularly in fast-growing regions like the Northeast and Florida. They’ll also enable more responsive, digital-first customer service.
International markets, where Sysco has deployed its digital playbook more rapidly, continue to outperform. Digital order penetration is higher in Sysco’s Canada, U.K., and Ireland businesses, where local case volume grew 4.5% and adjusted operating income surged 17.4% in Q3. The company plans to open additional facilities in Sweden and Ireland this summer to meet demand and support further digital expansion.
Sysco omnichannel model
Sysco is also piloting a “Sysco To Go” Cash & Carry concept in Houston to reach value-seeking restaurants that prefer walk-in service and pay-in-person options. Though early-stage, the stores integrate with Sysco’s supply chain and ordering systems to test a new omnichannel retail model.
While executives acknowledged macroeconomic risks — including tariffs and softening consumer confidence — they reiterated that digital initiatives are core to Sysco’s long-term growth strategy. Sales productivity, enhanced by better CRM tools and compensation alignment, is expected to become a tailwind in fiscal 2026 as recent hires reach full maturity.
“Digital tools, pricing agility, and fulfillment efficiency are foundational to how we compete,” Hourican said. “We’re making these investments now — despite the macro headwinds — because they position us to grow faster and smarter in the long term.”
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