Foodservice distributor
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A foodservice distributor is a company that provides food and non-food products to restaurants, cafeterias, industrial caterers, and hospitals and nursing homes.
A foodservice distributor functions as an intermediary between food manufacturers and the foodservice operator (usually a chef, foodservice director, food & beverage manager, and independent food preparation businesses operator owners.) Foodservice distributors procure pallets and bulk inventory quantites that are broken down to case and sometimes unit quantities for the foodservice operator. Most foodservice operators purchase from a range of local, speciality, and broadline foodservice distributors on a daily or weekly basis.
Often times a food manufacturer may hire a foodservice brokerage company to represent the manufacturer in a local market. The broker helps the food manufacturer market its products through the foodservice distribution system, which ranges from getting items stocked at the distributor to working with operators to purchase items from the distrubor.
A broadline distributor services a wide variety of accounts with a wide variety of products, while a system distributor stocks a narrow array of products for specific customers, such as chain restaurants.
Foodservice distribution companies can range in size from a one-truck operation to massive corporations, such as SYSCO and U.S. Foodservice. There are many independent broadline foodservice distribution companies that service chain and multi-unit restaurants based on master distribution agreements with national foodservice groups. These groups provide distributor members procurement capabilities rival the purchasing power of largest distributors. These distributor groups also provide distributor members group private label brands as well as marketing and quality assurance services.
Redistribution
An emerging trend in the foodservice distribution business is redistribution.
Before the advent of redistribution, only the largest foodservice distributors could purchase enough products from an individual food manufacturer to fill up an entire truck. Smaller distributors were forced to purchase in less than truckload (LTL) quantities, putting them at a significant logistical disadvantage to the larger distributors.
In the food redistribution model, a redistributor will purchase in truckload quantities from many food manufacturers and warehouse the products. Individual distributors can then purchase multiple manufacturers' products from the redistributor and fill up an entire truck to save on shipping costs. The largest food redistributor in the U.S. is DOT Foods.
Foodservice Distribution Companies
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Industry information
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