Yelloh further reduces delivery footprint, lays off workers

Yelloh, the food delivery business formerly known as Schwan’s, will be sending its yellow delivery trucks to fewer locations starting this summer.

It’s the company’s second reduction to its service area in a year.

The company is laying off 44 employees in Minnesota as it closes delivery sites in Breckenridge, Esko, Eveleth, Moorhead, St. Cloud and Waconia, according to a state filing. Additional site closures and layoffs have been reported around the country.

Yelloh will still operate in parts of Minnesota and 15 other states.

“We are saddened to share that we will be closing our operations in some locations by the end of July 2024,” the Bloomington-based company said in a statement. “Despite continued efforts to turn our business around locally, we simply do not see a profitable path forward for these depots.”

Last fall Yelloh announced it would lay off 750 people nationally, close 90 delivery sites and reduce delivery service to 18 states. Shipping is still available to the Lower 48 via UPS, the company said.

Schwan’s started delivering ice cream in rural Minnesota in 1952 and grew to be a nationally known company with its trademark yellow trucks. Schwan’s also grew into a food manufacturer and distributor beyond its home delivery.

In 2019, South Korea’s CJ CheilJedang bought the bulk of the Schwan’s company for $1.8 billion. The Schwan family retained the delivery business and rebranded it as Yelloh.

The company faces far more competition today, from food delivery apps like Instacart or Uber Eats, than it did for most of its history. Some customers have also been dissatisfied with the company’s offerings since the switch to Yelloh.

“We are committed to taking care of our impacted team members and will work to support our customers in their transition to our online or app-based ordering solutions,” Yelloh said.