Vertical Integration/Outsourcing

Kroger uses both vertical integration and outsourcing.  Approximately 39% of the corporate brands sold are produced in Kroger's manufacturing facilities.  The remainder of corporate brands is outsourced to other manufacturers.  Kroger performs a make or buy analysis based on a comparison of market based transfer prices adjusted for plant profit versus open market purchases.  All corporate brands, whether manufactured or purchased, are held to the same high standards.  The consistent focus on quality provides the foundation of Kroger's corporate brands program.
http://www.thekrogerco.com/operations/operations_manufacturing.htm

Kroger operates dairy, bakery, meat, and grocery manufacturing facilities.  The following link shows a map of where all of Kroger's manufacturing facilities are located.  There are three manufacturing facilities in Kentucky.  There is a grocery manufacturing facility in Murray, a dairy manufacturing facility in Winchester and a bakery manufacturing facility in Bowling Green.
http://www.thekrogerco.com/operations/operations_manufacturing_map.htm

Kroger Manufacturing Vision:
We will be the first choice for high-quality products of exceptional value in every market we serve.

Kroger Manufacturing Mission:
Kroger Manufacturing will achieve its vision and become the employer-of-choice by valuing people and by professionally managing our business to provide:
-An injury free workplace 
-Uncompromising quality 
-Exceptional value 
-Outstanding reliability and productivity 
-Exceptional customer service 
-Innovation and reapplication 
-Investment in people 
-Diversity 
-Community involvement
http://www.thekrogerco.com/operations/operations_manufacturing_vision.htm#