Economy pinches business for Big Apple distributors - The Packer

Economy pinches business for Big Apple distributors

02/24/2012 01:08:00 PM
Doug Ohlemeier

NEW YORK — Things aren’t so rosy red in the Big Apple.
Produce wholesalers report continued slow movement. 
“You read all the papers how things are supposed to be getting better, but I don’t see it,” said Mike Cochran, sales manager and vice president of Robert T. Cochran & Co. Inc. 
“It seems like it’s (the economy) still in the doghouse. People are scared to buy things. They’re buying lesser quantities.”
Matthew D’Arrigo, vice president of D’Arrigo Bros. Co. of New York Inc., and co-chairman of the Hunts Point Terminal Market, said the market’s customers feel the pinch.
“There’s no question that within our industry, the foodservice segment is far more affected by a poor economy than the retail end is,” he said. 
“The retailers are in some ways even enhanced by shoppers having a few less dollars to spend because the most effective way to feed people is through the retail stores. That’s generally true.”
Chris Armata, president of E. Armata Inc., which distributes produce from 20 market stalls, said it’s a difficult time to sell and distribute produce.
“Everyone is trying to save money and slow up the way they pay,” he said. 
“It seems that everyone, including the customers of our customers in our retail, wholesale and institutional customers, are up against a lot of competition. Everyone’s fighting for the same pie. The most important thing for guys like us is to make sure our growers get paid. Without them, we’re nothing.”
Distributors must remain on top of their sales, their customers and how their customers are ordering, said Thomas Cignarella, president of Morris Okun Inc.
“Everyone is so price-oriented,” he said. 
“The customers order only what they need. No one over-orders anymore. You must try to find new business and other outlets, and try to get the chain stores in your area. There are a lot of people out there that are struggling. Everyone is feeling the economy in their own way. It’s not outstanding, but if you’re above the water, you’re doing OK.”
Customers are fussier than ever, said Alfie Badalamenti, vice president of Coosemans New York Inc.
“They’re even more picky, and they’re ordering less,” he said. 
“They have more time on their hands to check everything ... It’s all about price now. Everyone is looking to save as much money as possible.”
The economy keeps produce demand challenging, said Mike Muzyk, president of Baldor Specialty Foods Inc.
Adjacent to the Hunts Point Terminal Market, Baldor distributes throughout the Northeast and services Boston from a satellite operation.
“The economy is tough,” Muzyk said. 
“I am concerned about 2012. I fear it will not be a booming year, and I hope I’m wrong. New York has always had the luxury of being the destination location for our European friends. When they’re prospering and growing, they have been able to take advantage of flying to New York and spending their money in terms of our business when they’re staying at our hotels and eating at our restaurants.” 
With the drama occurring in the European debt crisis, Muzyk said America’s and New York’s economic risk remains high.
Suburban distributors say sales remain difficult. 
“It’s a rough business,” said Joe Granata, director of produce for RLB Food Distributors LP, West Caldwell, N.J. 
“The economy is still struggling. Fuel prices, Mother Nature, it’s one thing after another that’s cutting into our profits. It’s been a long haul since late 2010.  Everyone is struggling. There’s also a lot of new competition in the area.” 
Some bright spots, however, involve the specialty grocery stores in the boroughs of Brooklyn, Queens and Staten Island, Granata said.
He said those areas are booming and said Brooklyn retail sales are “like another Manhattan out there.”
Granata said the region is seeing many strong operators opening stores in the tri-state region.
Sales increased about 13% over the last year for J. Kings Foodservice Professionals Inc., Holtsville, N.Y., said Joel Panagakos, executive vice president.
“We have had a couple of years where things kind of leveled off, but sales have increased this last year,” he said. 
“Those steady customers are suggesting us to some of their associates who have other businesses, so it’s word of mouth. Plus, our sales force is always out there and we have been targeting more street business.”

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