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New York wholesalers show their value to retail

Retail competition affects the way New York wholesalers operate.

For instance, Fres Co has “adapted our business model to incorporate the opening of distribution centers,” says Charlie J. DiMaggio, president of Fres Co LLC.

The company not only started a brokerage and chain store division, but is now offering its own premium brand, Belleza. Fres Co offers core and premium products with competitive pricing for both large and small grocers.

Despite competition, S. Katzman Produce also continues to grow its grocery business, grounded in the fact that wholesalers are still a vital component to the market.

“We serve many purposes for our grocery stores,” says Stefanie Katzman, executive manager, “and using a ‘middleman’ does not always mean extra costs and higher prices.”

“We work with perishables, and no matter how good businesses are, there’s no way to control Mother Nature,” she says, and stresses that all grocers—whether national, regional, or independent—need multiple sources for fresh produce.

“When product comes from all over the country, and all over the world, it’s definitely a benefit to have a partnership with a wholesaler right next door.”

Katzman says the list of benefits goes on, but one of particular importance revolves around filling gaps due to short product, “replacements for poor arrivals, surprise orders, and special sale opportunities.”

Wholesalers also serve as a supply solution to smaller independent chains, taking away the need for their own distribution centers, or additional onsite storage.

This is especially true in New York City, she says, “where the rent is very high, the space is small, and retailers want to take advantage of every inch of display space.”

In these cases, wholesalers become a friend in need, serving as a retailer’s “additional storage” space. Additionally, when grocers can’t bring in the necessary load volume but still want to take advantage of large-volume pricing, wholesalers are once again their best bet.

New trucking regulations increase a wholesaler’s allure as well: “Most transportation companies are not willing to stop a truck at multiple coolers, and most retailers don’t want to do that either to avoid delaying arrival,” she says.

In this scenario, going wholesale is the perfect solution because, Katzman notes, “we can bring in full truckloads of many items and then consolidate what the customer needs for delivery.”

Ultimately, wholesale is a crucial step that shouldn’t be skipped.

“No matter what size grocery stores are, wholesalers play a key role in working with them to provide the very freshest and widest range of products available to the consumer,” says Katzman.

This is an excerpt from the most recent Produce Blueprints quarterly journal. Click here to read the full article.

Courtney Kilian, who is based in Vista, CA, and has worked with both domestic and international growers and organizations, including the Natural Resources Conservation Service and California Avocados Direct.