Wholesalers, shippers and distributors are strategizing how to handle drastic changes in buying, selling, and how they manage employees as coronavirus COVID-19 has spread.
In typical times, one-third of business is from foodservice and two-thirds is from retail at TMK Produce on the Philadelphia Wholesale Produce Market, president Tom Kovacevich said.
As with other companies, foodservice business has disappeared, and retail is strong, he said.
“The last couple weeks, our business overall has gone up 60%, but we expect that to level off because we expect people to not have any money with layoffs and unemployment,” Kovacevich said. “We’re concerned what effect that’s going to have when the population doesn’t have money to shop.”
At the Boston Market Terminal, wholesaler Community-Suffolk Inc. is using customer relationships to help, said Tommy Piazza, co-owner and director of potato procurement and sales.
“It’s fairly devastating. We are a large foodservice provider,” Pizza said. “Fortunately, we have a balance within, so all our eggs are not in one basket. But it’s super noticeable.
“And because we have those connections with the retail folks, they have been helpful in taking some of what would be foodservice sizes or packs and using that for their bulk displays,” he said. “I think that’s a good sign of our customer relationships.”
When some of Piazza’s customers have product destined for foodservice that can’t be used any longer, sometimes his company will take it, whether or not it was purchased from Community-Suffolk, to sell on their behalf, taking only enough of a cut to do business.
“Everyone’s got to be up-front about this. It requires ethics and humanity,” Piazza said.
Vermont Hydroponic Produce operating partner Lauren Mordasky said some of her customers, like Stop & Shop, have revised policies, no longer allowing drivers to unload tomatoes and cart them inside the retailer’s warehouse, avoiding a lumpers fee.
“It makes sense, because they don’t want a bunch of new people going into the warehouse. I’m not a fan of having to pay the fee, but it is what it is,” Mordasky said.
Supply was already tight on Vermont Hydroponic tomatoes, “but now it’s just insane. We can’t keep up at all,” she said.
Some companies are adopting entirely new lines of business, at least temporarily, which can offset the loss of foodservice business.
Baldor Specialty Foods, near the Hunts Point Wholesale Produce Market, Bronx, N.Y., is primarily a foodservice distributor, although it has a retail line called Urban Roots.
Baldor took the unprecedented step to open its company to direct-to-consumer home deliveries for purchases of at least $250 within a 50-mile radius of its headquarters.
“We have never considered doing this before,” Baldor CEO TJ Murphy said in a news release. “But in times of crisis, everything must be put on the table and considered.”
Employers are allowing flexible schedules so employees can take care of children while schools are closed, as well as sick or older family members.
“It’s just kind of being responsible in these tough times,” Piazza said.
Community-Suffolk and other company leaders are also encouraging employees and each other to take boxes of food home for vulnerable neighbors in need.
“It’s really, really concerning times for everybody. We’re doing our best to get food to the people who need it. I know if I don’t eat, I get really hangry. We don’t need the whole population getting hangry,” Kovacevich said.