Posts Tagged ‘foodservice destributors’

Foodservice Distribution Conglomerates are Only Getting Bigger – or Are They?

February 29, 2012

Foodservice distribution giants continue to consolidate their holds on the market, according to Technomic. The food consultancy, based in Chicago, recently released a December 2011 report on the top “power distributor” movers and shakers from 2010. The results are interesting, to say the least.


Who’s in the Foodservice Distribution Report?


Technomic’s report concerns the top 35 power distributors in the United States, all of whom had annual calendar-year sales of $150 million or more during 2010.


As many of you have already guessed, Sysco Corp tops the list – at over $39 billion! U.S Foodservice comes in second place at less than half that: $18.9 billion.


Not until 10th place Labatt Food Service do we drop down below the billion dollar mark. Their 2010 sales totaled $922 million.


So What do the Figures Mean?


For most of these foodservice distribution companies, these massive figures don’t represent staying stagnant. All but three of the top 15 foodservice giants reported some sort of sales growth in 2010.


Only two companies – U.S. Food Service and Institution Food House – reported losses (Half a percent and 5.4%, respectively). Scottsdale, AZ-based Services Group of America reported neither gain nor loss, at 0% growth.


All in all, it means that distribution giants are grabbing even more of the pie than usual. This has been the state of affairs with other industries – in fact, with the U.S. corporate scene in general – for many years now.


But There’s a Catch!


It’s important to take note that these distribution giants could very well be doing high dollar amounts of sales while still doing less volume. Increases in the top 15 companies range from 1% to 13.6%.


Sharp price increases during 2010 may actually balance out these figures and indicate that, while the dollar amounts may be up, per-unit sales volume was perhaps closer to flat. In fact for many companies with a dollar-amount increase, volume might have actually gone down in 2010!


I’m curious to see the reports on 2011. I believe the numbers will be more encouraging.