Value pushes sales growth in Southwest, wholesalers report - The Packer

Value pushes sales growth in Southwest, wholesalers report

01/04/2013 10:50:00 AM
Jim Offner

Whether it’s the region’s booming population trajectory, it’s ethnic mix or its apparent economic recovery, the Southwest presents plenty of sales opportunities in both retail and foodservice segments, according to produce suppliers there.

“Whether it’s foodservice or retail, it’s a value-driven market,” said Rick Crispo, a partner in Glendale, Ariz.-based wholesaler Legend Distributing LLC.

That means product that is off-grade or off-size will sell well, he said.

“That doesn’t mean a compromise in quality. It’s something that maybe doesn’t fit a corporate spec,” he said.

Price is the object, agreed John French, owner of Phoenix-based broker, repacker and distributor Produce Brokers of Arizona Inc.

“The economy is coming back. Housing is starting back, but it’s all in a very small way, and everybody is still very cautious as to what they want to do,” he said.

The region’s ethnic balance is a plus, and it is flourishing again after some lean times, Crispo said.

“We went through a period when some immigration laws were passed where, quite honestly, some of the Hispanic customers we had left this market. But now we’re starting to see that Hispanic segment pick back up.”

Another market that has rebounded is the population of part-time residents, Crispo said.

“One thing we’re most excited about now is we’re getting our snowbird population back, which we didn’t have as strong during tougher economic times,” he said.

Hotels and restaurants appear to be doing more business than in previous years, which is good for the produce business, Crispo said.

“It certainly looks like we’ve been through the worst that we had in the foodservice industry,” he said.


Foodservice rebound

That’s good, because foodservice is probably the chief driver of the area’s produce economy, said Willie Itule, owner of Willie Itule Produce Inc., Phoenix.

“Foodservice is a big thing,” he said.

Itule said he had noticed an economic rebound taking shape in the region over the last 18 months.

“It seems real estate in Phoenix is picking up, which makes things happen. We’ve noticed a big uptrend in people dining,” he said.

Chain restaurants are dropping their prices, and smaller, independent eateries are thriving, Itule said.

“The big trend here in Phoenix seems to be the small independent restaurants and neighborhood-type restaurants, which seem to be really catching on here,” he said.

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