The meltdown in the ABC warehouse meant restaurants ran dry and liquor store shelves went empty as they waited week after week for shipments that never came. ABC warehouse manager Ruan Transport chose to remove the conveyor belt system and replace software system at the same in January. However, Ruan was supposed to replace the conveyor belts last year. The replacement of the two systems at the same time resulted in a perfect definition of "SNAFU"
ABC contracted with Ruan in 2023 to manage its warehouse in Gluckstadt. The contract was worth $45 million. Ruan closed down the warehouse from January 7-12 this year to take inventory as it does every year. Unfortunately for all, Ruan was not satisfied with just counting cases.
The warehouse management software was installed in 2003 and at the end of life stage. Since there would be no more updates for the software, Ruan installed the Blue Yonder software system while it was shut down - but did so without beta testing. The system went live when the warehouse reopened. Disaster immediately ensued as Blue Yonder and ABC's software, MARS, did not communicate to each other as they should. Orders piled up while few cases went out the door.
Ruan piled on the projects during the shutdown as it also removed the conveyor belt system that had been in use for decades. State Department of Revenue Commissioner Chris Graham told the House State Affairs Committee Tuesday the belt system was obsolete and they could not longer obtain parts for it unless they were fabricated.
Commissioner Graham said replacing the conveyor belt system with new conveyor belts was not an option as the warehouse would have to shut down for 30-60 days during replacement.
After removing the conveyor belt, Ruan switched to a pick a pallet delivery system. No longer were orders sorted at the warehouse but instead were shrink-wrapped and placed on pallets. Thus a pallet might have multiple orders on the same pallet, leaving the truck driver to do the sorting.
Customers such as liquor stores, restaurants, and casinos paid the price for Ruan's incompetence. Orders were usually delivered within 48 hours but thanks to the snafu, customers had to wait 3 1/2 weeks for deliveries. The delay meant shelves went empty and restaurants ran out of liquor.
Those affected questioned (in not so nice words) why Ruan removed the conveyor belts at the same time it installed new software.
The conveyor belt system did not suddenly fail as Ruan planned to replace it for nearly a year.
Ruan and the Revenooers (Sounds like a band) executed an amendment to the contract in March 2025. The amendment states:
The amendment increased the amount paid to Ruan per case. The original rates are:
First year: $2.22
Second year: $2.35
Third year: $2.49
Fourth year: $2.64
The new rates are $2.65 for the third year, a difference of 16 cents, and $2.70 for the fourth year, an increase of 6 cents.
What is interesting is the amendment decrees Ruan shall be paid the higher rate starting March 1, 2025 even though it did not switch to the pick a pallet system until January 2026. So it appears Ruan was paid extra for a system it did not implement for another nine months.
Fortunately, ABC customers may soon see some relief. A source said the warehouse has cut and delivered 15,000, 16,000, and 18,000 cases each day over the last three days. The 18,000 shipment includes 2,000 cases of bulk orders for wholesalers.
ABC told customers it expects to ship 70,000 cases this week:
Kingfish note: Hmmmm...... ABC ships roughly 4 million cases of booze per year. Adjusting for a period of nine months yields 3 million cases shipped.
3,000,000 x 0.16 (increase) = $480,000.
Thus Ruan probably received nearly half a million dollars in higher rates for a system it never installed in 2025. Good grub if you can get it.
42 comments:
With a contract like that, I wonder if Coach Ellis Johnson is in management for Ruan Transport.
Graham should be fired, period. Even if he is an improvement over Frierson, there must be accountability. This is a bad management fiasco. Ball is in your court Governor Reeves. Put up or shut up time.
Seems like a more accurate acronym would be F.U.B.A.R.
I'm sure that "selection" of Management, was primarily predicated upon the proffering of the best "considerations" to the state's most key functionaries. Unfortunately, those best at doling-out "considerations" tend to be the least competent at doing whatever they've bought their way into being chosen to do.
Between the ice storm and the liquor shortage, Tate having a bad year as the man in charge.
Thank goodness i brew my own beer and don't like the taste of hard alcohol
Glad I quit drinking a couple years ago or I'd be wearing out I-20 to Delta, LA and back.
This entire ordeal is reminiscent of the cluster f*ck at Employment Security a few years ago.
"Commissioner Graham said replacing the conveyor belt system with new conveyor belts was not an option as the warehouse would have to shut down for 30-60 days during replacement."
Which is what happened anyway, without the benefit of new conveyor belts.
"Ruan Transport" - say it out loud and it sounds perfect.
$45 Million! That smells like a Jackson palm greasing sweetheart deal!
Makes you wonder about the bids from the local companies that were rejected in favor of Ruan and whether they were lower than these amended rates. Sounds like a nightmare!
I suspect that the Commissioner is not out of booze, nor is the guv's mansion.
Temperance is good for the soul.
Did UMMC provide the software support?
Shippers Express had that contract for 20-30 years and there was never no problem. Then politics got involved and they lost contract and here we are today!
It's the Mississippi way. Don't raise the bar or nothing will be accomplished, you friggin' hayseeds.
The state is in the business of alcohol in order to ensure they collect the taxes and nobody circumvents the rules. Except there no alcohol sales if there is no alcohol to sell. hmmm
Thank God the legislature is not paranoid about collecting the taxes on eggs and bread and milk, or we would all starve to death!
If I have said it once, I'll say it a million times... Do Away with MS ABC! This is asinine and should be handled like other states. Audit the hell out of them if you want, but the State should not be playing the middle man.
There are 17 alcohol control states. The only two alcohol control states in the Southeastern Conference are Alabama and Mississippi. Roll Tide War Damn Eagle Hotty Toddy Hail State To The Top!
Shad’s officers need to audit all procurements off that contract and the contract solicitation itself. The findings would be interesting.
How do you not set up a temporary pick up for customers to at least come get what they’ve ordered while it’s down? Just give a two week grace period and let the businesses send a truck to pick up their alcohol at the warehouse. Or is it not that simple? I don’t drink.
Who / what state dept was responsible for contract enforcement?
This is bush league, City of Jackson incompetence. Ginger Tellytubby better put a bunch of skins on the wall.
They have a new facility under construction in Canton. Yates is the contractor. The facility will be finished later this year. Could they not just limp along with the old software and conveyor belts for a few more months?
Completely agree. A full audit is called for.
State changed from Shippers Express to Douglas in the middle of the summer a while back. Forgot to mention to the drivers that they would have to unload the trucks themselves. We met a new driver every week and were told they lost most of their drivers due to this failure to communicate. This is absolutely not the first time the ABC has tripped. We can blame Ruan but it’s 100% a result of communication and management. How could you continue to work with a business that doesn’t even utilized up to date technology with no idea if it will actually work when it’s turned on
@340 - get a clue. See if you can keep up, maybe try reading. Shippers Express did not have THIS contract for 20-30 years or whatever - you are talking about a separate, but not equal contract for DELIVERY of the product. Ruan has a contract for managing the warehouse, somethat that was done by state employees up until a couple of years ago, and the cost of paying for those employees, plus all the other parts of managing the operation, exceeded what Ruan is being paid today - even taking into consideration KF's 'worry' over the increased rate for going to a pallet system. Maybe, KF, there is some cost in making the changeover, like possibly purchasing additional forklifts, or pallets, or a shrinkwrap machine, or supplies. Who knows? But the cost of implementing ANY change in any manufacturing/shipping process like this do not start on the day of the change - there are significant costs involved in the lead-up to it. But, hell - guess the Fish is just like a lot of his readers and commentors, gotta bitch about something a government deal is doing or else, don't get them clicks.
Mississippi is a clusterfuck by design. That way the dirt dumb good ole' boys/girls can always have something to say they're fixing. 200 years behind the rest of the country.
The problem is the software would get no updates and they have a year to go. That is a long time to go without security patches and updates. Very risky.
Does anyone actually believe that with a $45 Million contract there isn't some fraud involved?
This is absurd in this day and age. Please someone offer a viable quick solution. Having a drink is the only thing that gets me from one National foolish demented orange Buffon moment to the next.
Trey Lamar was pushing direct shipping the other day at the committee hearing.
They should privatize this asap. The state would see a lot more revenue and taxes, maybe double! Anyone who deals in this game knows the hustle and there are many from the warehouse to the shipping and even the retailers. The insane amount of “broken” cases would drop immediately if a private company was responsible. Shad could have a field day with this if only his handlers would let him.
Follow the grift. Just don't be surprised if the trail ends at 400 High Street.
Virtually every other product including groceries, toys, cars, weed, etc. gets taxed properly without a state warehouse. That is an old and out of date argument. The truth is that the liquor stores prefer the warehouse model because that makes them a part of the monopoly. They do not want competition (i.e. wine in grocery stores). We are last in everything for a reason, and the reason is our leadership year in and year out.
"Graham should be fired, period. Even if he is an improvement over Frierson, there must be accountability. This is a bad management fiasco. Ball is in your court Governor Reeves. Put up or shut up time."
No one at MDOT will be held accountable for the disastrous preparation and response to the ice storm, this will be no different. Heck, they'll probably get raises.
Get Mississippi out of the liquor business entirely. Let private enterprises buy and sell. It will be more efficient and prices will be lower with more variety.
The Mississippi Independent Package Stores Association, a 501(c)(6) nonprofit, is the lobbying group for the state’s independently owned liquor stores.
State needs to get out of this. Now.
Perhaps someone has noticed the cost of alcoholic beverages is 15% less in many Austin TX stores, the selection is atmospherically diverse and stocked to the ceilings. Why can't MS collect their tax at the register and let private competition increase options while reducing prices? Because there are sick bloodsuckin bureaucrats that must be fed and cost be damned.
Whelp, seems the fish has stirred thangs up, I was at Sam’s today lo and behold pallets stacked up, bins full and shelves filling up
After removing the conveyor belt, Ruan switched to a pick a pallet delivery system. No longer were orders sorted at the warehouse but instead were shrink-wrapped and placed on pallets. Thus a pallet might have multiple orders on the same pallet, leaving the truck driver to do the sorting.
Aside from the inefficencies of the driver needing to go through his truck climbing over the pallets and opening all the shrink wrapped pallets to collect all the items in the customer's order...how does the driver then drive down the road to the rest of his deliveries with the shrinkwrap cut off the pallets?
MORONS!
It's breakable merchandise!
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