Fresh Produce Wholesalers
Description
Companies in this industry distribute fresh fruits, vegetables, spices, and herbs. Major companies include Coast Citrus Distributors, FreshPoint, SpartanNash and Tom Lange Company (all based in the US), as well as Fresh Produce Group (Australia), Fyffes (Ireland), IG International (India), Oppy (Canada), and Tokyo Seika (Japan). Vertically integrated fruit and vegetable producers such as Chiquita, Del Monte Foods, and Dole have major global distribution operations.
Worldwide, more than one billion metric tons of fruits and vegetables are harvested for human and animal consumption, according to research from the University of Saskatchewan. Despite the significant progress in increasing food production, about half of the global population does not have access to food supplies. Technology with high levels of automation and reliability can ensure adequate agricultural production.
The US fresh produce wholesalers industry includes about 5,000 establishments (single-location companies or units of multi-location companies) that generate annual revenue of about $90 billion.
COMPETITIVE LANDSCAPE
Demand is driven by consumption of fruits and vegetables. Profitability depends on maintaining a high quality and varied selection of produce and on efficient operations. Larger distributors benefit from economies of scale in purchasing and transportation. Smaller companies may compete by specializing in certain products, such as tropical fruits or organic products, or by focusing on a geographical area. The US industry is fragmented: the 50 largest companies account for about 40% of industry revenue.
Produce cooperatives, in which growers work together to process and distribute their products, compete with traditional distributors. Major retailers or food service contractors may choose to deal directly with growers, bypassing distributors.
PRODUCTS, OPERATIONS & TECHNOLOGY
Distributors' main operations involve getting fruit and vegetables from producers to customers, which include food retailers and food service providers. Major products include fresh fruits (55% of industry revenue), fresh vegetables (35%), and prepackaged fresh-cut vegetables (10%). Distributors may also offer products such as fresh spices, herbs, seasonal nuts, salad dressings, tofu, juice, or flowers. Some companies specialize in exotic produce and staples of various ethnic cuisines, such as enoki mushrooms and lotus root (which are used in many Asian dishes) or corn husks and cactus pads (common ingredients in traditional Latin American foods).
Many wholesalers receive produce from around the country and globally and then distribute the products regionally. Distributors typically consolidate shipments from suppliers at one or more regional warehouses and deliver daily to customers using a fleet of trucks, which may be owned, leased, or contracted. Wholesalers may inspect the produce for consistency and may repack the products if necessary. Some wholesalers offer in-house processing, which includes creating fresh-cut or pre-peeled fruits and vegetables. Some large distributors are vertically integrated, either running their own farms and packaging facilities, their own grocery stores, or both.
Major inputs include fuel, electricity, pallets, trucks, and vehicle repairs. Warehouses are designed to help maintain food freshness through climate- and humidity-controlled coolers and refrigerated docks. Many warehouses contain specialized produce-processing areas such as banana-ripening rooms.
Worldwide, more than one billion metric tons of fruits and vegetables are harvested for human and animal consumption, according to research from the University of Saskatchewan. Despite the significant progress in increasing food production, about half of the global population does not have access to food supplies. Technology with high levels of automation and reliability can ensure adequate agricultural production.
The US fresh produce wholesalers industry includes about 5,000 establishments (single-location companies or units of multi-location companies) that generate annual revenue of about $90 billion.
COMPETITIVE LANDSCAPE
Demand is driven by consumption of fruits and vegetables. Profitability depends on maintaining a high quality and varied selection of produce and on efficient operations. Larger distributors benefit from economies of scale in purchasing and transportation. Smaller companies may compete by specializing in certain products, such as tropical fruits or organic products, or by focusing on a geographical area. The US industry is fragmented: the 50 largest companies account for about 40% of industry revenue.
Produce cooperatives, in which growers work together to process and distribute their products, compete with traditional distributors. Major retailers or food service contractors may choose to deal directly with growers, bypassing distributors.
PRODUCTS, OPERATIONS & TECHNOLOGY
Distributors' main operations involve getting fruit and vegetables from producers to customers, which include food retailers and food service providers. Major products include fresh fruits (55% of industry revenue), fresh vegetables (35%), and prepackaged fresh-cut vegetables (10%). Distributors may also offer products such as fresh spices, herbs, seasonal nuts, salad dressings, tofu, juice, or flowers. Some companies specialize in exotic produce and staples of various ethnic cuisines, such as enoki mushrooms and lotus root (which are used in many Asian dishes) or corn husks and cactus pads (common ingredients in traditional Latin American foods).
Many wholesalers receive produce from around the country and globally and then distribute the products regionally. Distributors typically consolidate shipments from suppliers at one or more regional warehouses and deliver daily to customers using a fleet of trucks, which may be owned, leased, or contracted. Wholesalers may inspect the produce for consistency and may repack the products if necessary. Some wholesalers offer in-house processing, which includes creating fresh-cut or pre-peeled fruits and vegetables. Some large distributors are vertically integrated, either running their own farms and packaging facilities, their own grocery stores, or both.
Major inputs include fuel, electricity, pallets, trucks, and vehicle repairs. Warehouses are designed to help maintain food freshness through climate- and humidity-controlled coolers and refrigerated docks. Many warehouses contain specialized produce-processing areas such as banana-ripening rooms.
Table of Contents
- Industry Overview
- Quarterly Industry Update
- Business Challenges
- Business Trends
- Industry Opportunities
- Call Preparation Questions
- Financial Information
- Industry Forecast
- Web Links and Acronyms
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