XML 26 R14.htm IDEA: XBRL DOCUMENT v3.21.2
Goodwill and Other Intangibles
 9 Months Ended
Oct. 02, 2021
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangibles GOODWILL AND OTHER INTANGIBLES
Goodwill includes the cost of acquired businesses in excess of the fair value of the tangible and other intangible net assets acquired. Other intangible assets include customer relationships, amortizable trade names, noncompete agreements, the brand names comprising the Company’s portfolio of exclusive brands, and trademarks. Brand names and trademarks are indefinite-lived intangible assets and, accordingly, are not subject to amortization, but are subject to impairment assessments as described below.
Customer relationships, amortizable trade names and noncompete agreements are intangible assets with definite lives, and are carried at the acquired fair value less accumulated amortization. Customer relationships, amortizable trade names and noncompete agreements are amortized over their estimated useful lives (which range from approximately 3 to 15 years). Amortization expense was $12 million and $21 million for the 13 weeks ended October 2, 2021 and September 26, 2020, respectively, and $44 million and $59 million for the 39 weeks ended October 2, 2021 and September 26, 2020, respectively.
Goodwill and other intangibles—net consisted of the following:
October 2, 2021January 2, 2021
Goodwill$5,625 $5,637 
Other intangibles—net
Customer relationships—amortizable:
Gross carrying amount
$655 $725 
Accumulated amortization
(90)(119)
Net carrying value
565 606 
Trade names—amortizable:
Gross carrying amount
4 15 
Accumulated amortization
— (11)
Net carrying value
4 4 
Noncompete agreements—amortizable:
Gross carrying amount
3 3 
Accumulated amortization
(2)(2)
Net carrying value
1 1 
Brand names and trademarks—not amortizing
271 281 
Total other intangibles—net$841 $892 
The Company assesses for impairment of intangible assets with definite lives only if events occur that indicate that the carrying amount of an intangible asset may not be recoverable. The Company assesses goodwill and other intangible assets with indefinite lives for impairment annually, or more frequently if events occur that indicate an asset may be impaired. For goodwill and indefinite-lived intangible assets, the Company’s policy is to assess for impairment as of the beginning of each fiscal third quarter. The Company completed its most recent annual impairment assessment for goodwill and indefinite-lived intangible assets for impairment as of July 4, 2021, the first day of the third quarter of fiscal year 2021. During the third quarter of fiscal year 2021, the Company implemented rebranding initiatives related to the integration of a trade name acquired as part of the 2019 Food Group acquisition. As a result of the rebranding initiatives, the Company recognized an impairment charge of $7 million, which was included in restructuring and asset impairment charges in the Company's Consolidated Statement of Comprehensive Income. The remaining carrying value of the acquired trade name of $3 million as of October 2, 2021, was reclassified to trade names—amortizable and will be amortized with an estimated remaining useful life of 10 years. No other impairments were noted as part of the annual impairment assessment.

The decrease in goodwill as of October 2, 2021 is attributable to the finalization of the purchase price allocation recognized for the Smart Foodservice acquisition, as described in Note 4, Business Acquisitions. The net decrease in the gross carrying amount of customer relationships as of October 2, 2021 is attributable to the write-off of fully amortized intangible assets related to certain 2016 and 2017 business acquisitions. The net decrease in the gross carrying amount of amortizable trade names is attributable to the write-off of the fully amortized trade name related to the Smart Foodservice acquisition, when Smart Foodservice® warehouse stores were rebranded to CHEF'STORE® in March 2021, partially offset by the aforementioned reclassification of the remaining carrying value of the trade name acquired with the Food Group acquisition. The net decrease in the gross carrying amount of brand names and trademarks—not amortizing is primarily due to the aforementioned impairment
of the trade name acquired with the Food Group acquisition with the remaining balance being reclassified to trade names—amortizable.