Foodservice Equipment Reports

Top Dealers And Top Broadliners

The June issue of FER with our annual Top Dealer Report is on the street. (If you haven’t seen it yet, go check out our digital edition at I call your attention to our listing this year of the durable E&S sales of leading broadline distributors. We revived the listing for the first time since we started the Top Dealer research back in 2011. The reason for the hiatus was simple: There’s only so much time in the day for Chris Palmer and I, who chase all of your down and cajole you into reporting and verifying. Broadliners add a whole ‘nother level of difficulty.

But we like to do hard things. (We were feeling frisky this year and also added leading dealers in Canada.) And the broadliners, as all of you know because you compete with them, are significant purveyors of durable supplies and tabletop, and sometimes, equipment. While they didn’t take over the E&S market as many feared back in the 1980s, they still sell a lot of stuff. The Top Five had combined durable supplies and equipment volume of $1.5 billion in 2014, by our reckoning.

We estimated sales for all of them, with the help of some very knowledgeable folks. None could or would break out their durable E&S volume for us. They get FER and FER Dealer Report, too, and everyone we wrote to or spoke with at the companies was very friendly. But all except Sysco are privately held.

We estimate all except Sysco have grown their E&S sales during the past five years. That’s not surprising given we were just coming out of the recession five years ago. But their E&S sales also have not grown nearly as much as most of the bigger E&S-only houses. Sysco’s sales are smaller than five years ago, in part because they restructured the way they sell and deliver E&S, using the online dealer Instawares as a fulfillment vehicle, for their rebranded “Supplies on the Fly.” The move was somewhat similar to what US Foods (then Foodservice) did turning Superior Products, the E&S catalog house they purchased, into Next Day Gourmet, but a few years later in the Internet revolution.

As you’ve all probably read, the leading broadliners have been in a state of flux the past couple years as Sysco Corp. has offered to buy US Foods; the federal government questions the competitive impacts on foodservice distribution. In our world, this is a significant issue, too, as a combined company would be moving almost as much durable E&S as TriMark USA.

But the “urge to merge” is a reflection of the realities of foodservice distribution, according to Barry Friends, a senior principal at Technomic Inc. The former US Foods executive reminded us distributing food is a very low margin business; it’s one of the reasons they’ve long been attracted to E&S. The big broadliners also have not been totally successful at penetrating chain markets (“custom” or “system” distributors such as Martin-Brower are key competitors); cash-and-carry outfits and the warehouse clubs have eaten into sales with small customers; group purchasing organizations have siphoned sales from institutional operators. On the E&S side, Friends believes booming online sales are hurting broadliners even more than traditional bricks and mortar dealers. (We’ve heard that from other folks, too.) They’ve thus been left with a smaller slice of the total foodservice market.

But they still move a lot of E&S. It’s important to know just how much. Distribution always finds its most efficient means.



Robin Ashton


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