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Food World area (which geographically stretches from Harrisburg, PA to Virginia Beach, VA on a north-south plane and from Dover, DE to Charlottesville, VA on an east-west plane):
The surging price of petroleum for most of the past 12 months coupled and other rising overhead expenses led to a year of challenges for many of the Mid-Atlantic’s wholesale grocers. However, there was general stability among independent retailers and wholesalers’ revenue was helped by overall inflation that affected the entire grocery industry.
One company that performed solidly despite those challenges and others from its corporate parent on the retail side was Supervalu’s eastern division. The Mechanicsville, VA based division of the large Eden Prairie, MN based firm ranked first again among all wholesale grocers in the Food World marketplace .
Supervalu continued to dominate the wholesale supply business with region’s independent grocers and has grown steadily under the leadership of eastern region president Kevin Kemp. In recent years, the region’s geography has been expanded to include distribution center in Xenia, OH and New Stanton, PA and now also is responsible for the distribution and logistics of the Acme Markets warehouse complex in Denver, PA which is currently being expanded and revamped. In addition to servicing Supervalu’s retail units – Acme, Shoppers Food & Pharmacy and Farm Fresh, the company also supplied such strong independents as Ukrop’s, Redner’s, B. Green, Magruder’s, Graul’s and Karns. During the past year, Supervalu also increased its customer count among ethnic operators in the region. For the year, Supervalu serviced 625 stores and amassed wholesale volume of $4.25 billion.
Maintaining its hold on second place again this year was C&S Wholesale Grocers. The Keene, NH based wholesaler really made its mark on the industry as a third-party distributor to larger chains. In the Mid-Atlantic, the privately-held, family-owned operation runs warehouses in Aberdeen, MD, York, PA and Collington, MD. Volume for the year was approximately $3.6 billion. Key accounts serviced include: Safeway, A&P, Giant/Carlisle and a portion of Giant/Landover’s business.
Associated Wholesalers Inc. (AWI) is the largest wholesale cooperative operating in the Food World area. The company’s primary distribution center is based in Robesonia, PA and it also operates a secondary facility in York, PA. During the past year, it has continued integrating key functions with its sister company, White Rose, a voluntary distributor based in Carteret, NJ which it acquired in 2006. AWI serviced 963 retail stores and rang up sales of $1.2 billion. Key customers include: the ShurFine/ShurSave retailers, McKay’s, Kennie’s and Lauer’s.
With 23 high-volume club stores in the Food World marketing area, Costco now ranks fourth among all wholesale companies in the region. Wholesale volume for Costco, as well as Sam’s Club and BJ’s. have been extrapolated to include sales of grocery, HBC, general merchandise and tobacco. Utilizing that formula, Costco’s 23 club stores in the market rang up sales of $1.02 billion .
Ranking fifth among wholesalers operating in the Mid-Atlantic was the McLane Company, the largest convenience store distributor in the country. Founded by the McLane family in 1894, Drayton McLane (the third generation of family leadership and owner of the Houston Astros baseball team), sold the company in 1990 to Wal-Mart, which in turn sold it to Warren Buffet’s Berkshire Hathaway organization in 2003. Primarily operating in this region from a 653,000 square foot depot in Falmouth, VA (one of 19 grocery warehouses the company operates nationally), McLane’s wholesale volume in the region is estimated to be $916 million. Its major account is 7-Eleven, which operates more than 900 c-stores in the market.
Sam’s Club (a unit of Wal-Mart) and BJ’s Wholesale Club ranked sixth and seventh respectively among all distributors in the region. Sam’s 26 club units rang up estimated extrapolated sales of $849.7 million. BJ’s, based in Natick, MA operated 22 club stores in the area (including one that opened earlier this month in Richmond) and amassed estimated sales of $734.6 million.
Burris Retail Logistics, which carved out its reputation distributing frozen foods, has expanded into other departments over the past decade. The Milford, DE based company, which operates Mid-Atlantic depots in Harrington, DE; New Castle, DE; Elkton, MD; Federalsburg, MD; Lancaster, PA; and Chesapeake, VA, garnered $500 million in wholesale volume over the past 12 months. The family-controlled firm also opened recently opened a new distribution center in Rocky Hill, CT, which will service BJ’s in New England. Other key customers include: Acme Markets, Giant/Landover, Mars Super Markets and The Fresh Market.
Other retail distributors who topped the $300 million in Mid-Atlantic wholesale sales threshold include: United Natural Foods Inc (UNFI - $410 million);Cooper-Booth ($352 million), based in Mountville, PA where it maintains a 100,000 square foot depot; Eby-Brown ($330 million), operating a 200,000 square foot warehouse in Baltimore; Bozzuto’s ($320 million), based in Cheshire, PA and operating a satellite facility in Allentown, PA.
One company to watch is Wakefern, the largest co-operative wholesaler in the Northeast with annual sales of $7.81 billion ($27.4 million in the Food World marketing area). The big northern New Jersey company services only two stores in the Food World market – PriceRite discount units in Harrisburg, PA and York, PA, but will add the seven unit Klein’s retail group to its roster in early ‘09 and is continuing to look for ShopRite and PriceRite opportunities in Central PA and in the Baltimore-Washington market.
Food Trade News area (covers a 55 county area, stretching from Susquehanna County, PA to Cape May, NJ on a north-south plane and from Bergen County, NJ to Franklin County, PA on an east-west plane):
Sharp increases in commodity prices - particularly wheat, corn and, for much of 2008, petroleum, continued to create hardships for the area’s wholesale grocers. Moreover, competition remained fierce among Mid-Atlantic distributors who continued to be impacted by the limited growth of independent retailers and the ongoing the challenge to create higher margins.
Once again, Wakefern Food Corp. led the pack among all wholesalers in the Food Trade News marketplace.
The food industry’s largest grocery co-operative rang up estimated wholesale sales of $7.81 billion for 2008. It supplied 214 ShopRite stores and another 36 PriceRite discount units. During the past 12 months, the company opened seven new Shop Rite units and announced that Klein’s Family Markets, the seven-store independent based in Forest Ill, MD would join the co-op and become its first Maryland based member.
C&S Wholesale Grocers ranked second among all full-service distributors in the region. The Keene, NH based wholesaler has made its mark on the industry as a third-party distributor to larger chains. In the Food Trade News region, the privately-held, family-owned company operates warehouses in Dayton, NJ; North Brunswick, NJ; Woodbridge, NJ; North Brunswick, NJ; York, PA; and a large new facility in Bethlehem, PA. Volume for the year was $6.01 billion. Key accounts serviced include: Safeway/Genuardi’s, A&P/Pathmark and Giant/Carlisle and the recently added Penn Traffic.
Supervalu’s eastern region, based in Mechanicsville, VA, has expanded its boundaries to now include Supervalu facilities in Western Pennsylvania and in Xenia, OH also has oversight of the Acme Markets distribution center based in Denver, PA. That site will become part of a larger distribution complex that is scheduled to be built in the next two years. integrated into the Denver, PA complex and include a new mechanized distribution center will be built adjacent to the current Acme facility. For the year, Supervalu serviced 625 stores and amassed wholesale volume of $4.25 billion. Other than Acme, key accounts include Farm Fresh, Shoppers Food & Pharmacy (both also corporately-owned), Redner’s, McCaffrey’s, Murphy’s, Karns, Boyer’s and The Fresh Grocer.
Associated Wholesalers Inc. (AWI) moved its sales needle forward in 2008. The wholesale co-op’s primary distribution center is based in Robesonia, PA and it also operates a secondary facility in York, PA. During the past year, it has continued to integrate key functions with its sister company, White Rose, a voluntary distributor based in Carteret, NJ that AWI acquired 30 months ago. AWI serviced 963 retail stores and rang up sales of $1.2 billion. Key customers include: the ShurFine/ShurSave retailers, Stauffer’s of Kissel Hill, Gerrity’s and Darrenkamp’s.
Sister company White Rose also had another solid year, despite the challenges of the wholesale sector. The Carteret, NJ based company serviced some of the top independent groups in the metro New York market (Foodtown, Kings, Met Foodmarkets, Pioneer) and also is the primary supplier of the Delaware valley area’s Thriftway and Shop ‘n Bag stores. Volume for the year is estimated at $1.2 billion.
Ranking sixth among wholesalers operating in the Mid-Atlantic was the McLane Company, the largest convenience store distributor in the country. Founded by the McLane family in 1894, Drayton McLane (the third generation of family leadership and owner of the Houston Astros baseball team), sold the company in 1990 to Wal-Mart, which in turn sold it to Warren Buffet’s Berkshire Hathaway organization in 2003. Operating from a several distribution centers in the region including one dedicated to servicing Wawa in Carneys Point, NJ (other facilities include 653,000 square foot depot in Falmouth, VA and a 365,000 square foot warehouse in Baldwinsville, NY. McLane’s wholesale volume in the region is estimated to be $981 million. Along with Wawa, the wholesaler services 7-Eleven, which operates more than 900 c-stores in the Mid-Atlantic area.
The leading club store operator in the region was BJ’s Wholesale Club. Wholesale volume for BJ’s as well as Sam’s Club and Costco have been extrapolated to include sales of grocery, HBC, general merchandise and tobacco. Using that formula, BJ’s volume for its 31 club units in the market was $982.3 million. Another club operator, Sam’s, ranked behind BJ’s in the market. The big unit of Wal-Mart ran 22 units in the region and amassed estimated extrapolated sales of $778.4 million.
Costco, the largest club store retailer in the country, produced the highest per store volumes in the market, but ranked behind the other two club players in the Mid-Atlantic. Estimated sales on an extrapolated basis for the Seattle, WA area firm were $741.2 million for its 21 club units.
Burris Retail Logistics, which carved out its reputation distributing frozen foods, has expanded into other departments over the past decade. The Milford, DE based company, which operates Mid-Atlantic depots in Harrington, DE; New Castle, DE; Elkton, MD; Federalsburg, MD; Lancaster, PA; and Chesapeake, VA, garnered $500 million in wholesale volume over the past 12 months. The family-controlled firm also opened recently opened a new distribution center in Rocky Hill, CT, which will service BJ’s in New England. Other key customers include: Acme Markets, Giant/Landover, Mars Super Markets and The Fresh Market.
Other retail distributors who topped the $300 million in Mid-Atlantic wholesale sales threshold include: United Natural Foods Inc (UNFI - $440 million); Cooper-Booth ($352 million), based in Mountville, PA where it maintains a 100,000 square foot depot and Bozzuto’s ($320 million), based in Cheshire, CT and operating a satellite facility in Allentown, PA.
© Copyright 2008 Best-Met Publishing Co., Inc.