Retail competition strong in NYC

05/27/2014 09:35:00 AM
Doug Ohlemeier

The retail landscape in the Tri-State region remains competitive.

As new retailers attempt to enter the large marketplace, distributors that send product to the stores and their distribution centers say sales remain brisk as chains compete against each other for shoppers’ dollars.

“There’s a tremendous amount of competition here,” said Bruce Klein, director of marketing for Maurice A. Auerbach Inc., Secaucus, N.J. “You go to into all the retailers’ offices, and you will see how they have all their competitors’ ads on their bulletin boards.

“Everyone sees what the others do. They look at last year, what items were on sale during that time period, what’s available now, and they try to do the best they can with the information they have.”

Klein said the key to success is providing retail customers high quality product at the right prices.
Auerbach distributes garlic, asparagus, ginger, shallots, baby potatoes and onions to large, medium, small and independent retail chains throughout the Northeast.

A number of chains have recently made big expansions into the New York marketplace, including Salisbury, N.C.-based Food Lion LLC (a part of the Brussels-based Delhaize Group) and Rochester, N.Y.-based Wegmans Food Markets Inc., said Mike Muzyk, president of Baldor Specialty Foods Inc., New York.

“Retail is really competitive,” Muzyk said. “If I sell something to them, they don’t want the others to have it. They’re always looking over their shoulders to see what the competition is doing.”

Retail sales account for about 10% of Baldor’s sales, he said.

More merchandising

Supermarkets are investing more in merchandising, said Nick Pacia, co-owner and vice president of A.J. Trucco Inc., New York.

“They are building bigger displays and are doing more cross-merchandising, which results in better sales,” he said. “They do well by creating large and more visible displays and by offering a wider variety of items. Also, switching out the highlighted items on their weekly circulars more consistently attracts customers as well.”

Retail sales aren’t as dependable as before, said Jeff Young, a fruit buyer for New York-based A&J Produce Corp.

“The business comes in spurts,” he said. “It’s nothing steady. It’s nothing one can count on anymore. It’s all in timing, as we have these transportation disruptions. It’s nothing we can count on in a daily basis.”

A&J distributes to independent retail chains.

Weather also has been a big factor during the past winter.

“The snow really hurts our retail customers,” said Mike Cochran, sales manager and vice president of Robert T. Cochran & Co. Inc., New York. “It definitely messed them up, and many of them were complaining. Sales have been OK, but the cold and the snow were certainly hurting them.”

Other distributors report the snow and inclement weather helped product movement to retail customers.

RLB Food Distributors LP, West Caldwell, N.J., experienced strong sales weeks during the snowstorms, said Joe Granata, RLB’s director of produce.
January and February usually mark a good start for produce sales, as everyone goes on diets, he said.

Granata characterizes the region’s retail market as highly competitive.

“The Northeast is the most competitive area you will find,” he said. “It’s between the Shop Rites, the Whole Foods, the A&Ps, the Kings, the Pathmarks — the list goes on and on. Even the smaller stores are upgrading their stores and products and are trying to become a bit more upscale.”


Brutal winter

Alfie Badalamenti, vice president of Coosemans New York Inc., said the extreme cold and numerous snowstorms that besieged the metropolitan area from December through early April harmed retail sales.

Because it was cold and people didn’t want to go shopping, retailers were complaining, he said.

The stores saw the business but not as much movement as they should have experienced, Badalamenti said.

“It was a brutal winter for everyone — retailers and restaurants,” Badalamenti said in mid-May. “It was bad all over the Northeast, including Boston and
Philadelphia. Retailers are doing much better now and are running specials to bring in the customers.”

Otherwise, retail movement is normal, said Matthew D’Arrigo, vice president of D’Arrigo Bros. Co. of New York Inc.

“It’s been fine, and the retail business here in New York is doing well,” he said. “The green grocers and bodegas count heavily on the market to supply them. Most of our business ends up going to retail, and that’s where most produce is purchased.”

Retail sales account for about 25% of the sales for J. Kings Foodservice Professionals Inc., Holtsville, N.Y., said Joel Panagakos, salesman.

The company enjoys strong retail sales during the spring and summer local growing season, he said.

“Retail sales are competitive and you really have to come to the table with all the programs the retailers are looking for as it relates to food safety,”
Panagakos said. “Sometimes, it’s a challenge getting some of the smaller local growers up to speed but we help them with all the paperwork.

“Though they have large warehouses, the retailers look to us because it’s hard for them to get try to track local lines of product from Long Island, New Jersey, Connecticut and Massachusetts.”



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