Boston Wholesale Market Serves Dynamic Customers

Boston Skyline

Resilient companies in the Boston area serve the needs of both new and old world clients amid an increasingly diverse marketplace.

Produce SelectionHistorical Boston was a meeting of worlds with immigrants from the old countries paving the way for a brave future in the new. Boston’s crossroads served to promote innovative and even rebellious ideas, an environment remaining today as evidenced by the city’s diverse retail and restaurant sectors.

Case in point, according to Chain Store Guide’s Retail Market Share Report, the area’s largest portion of retail market share is held not by a major corporate conglomerate, but by hold-out independent DeMoulas Market Basket — with 24 percent of the retail market. However, corporate chains Stop & Shop and Albertsons/Shaw’s follow closely on DeMoulas’s heels with 19.5 percent and 11.8 percent, respectively. Though these three chains together control half the market share, the rest is divided among more than 17 other retail formats, including superstores, club stores, smaller independent chains, dollar stores and corner stores.

“Chains are growing and there is probably more consolidation coming,” says Anthony Sharrino, president of Eaton & Eustis Co. “Yet, Boston remains a diverse retail arena. The independent grocers are doing well because they concentrate on what they do best. The Old World corner stores are still a key part of the business. They have carved out a niche.”

As well, Boston’s foodservice scene is punctuated with a cross-section of restaurants, according to Glenn Messinger, general manager of Baldor Boston LLC. “The foodservice climate in Boston is very diverse,” he says. “There is great variety — from white tablecloth to fast-casual — in this city. Boston’s restaurant industry is strong and we anticipate continued growth.”

Dominic Joseph Cavallaro III, general manager in charge of sales at John Cerasuolo Co. Inc., agrees there is a lot going on in Boston. “Many new buildings are being constructed and a casino is coming in the next couple of years,” he says. “We anticipate this continued development will stimulate the food business and our market will continue to get a piece of it.”

“The backbone of our market business is everyone all together. The diversity of customers is our stability.”

— Jackie Piazza, Community-Suffolk

Within this dynamic marketplace, business at the New England Produce Center remains stable. “We continue doing business as usual,” reports Sharrino. “Our market merchants continue having day-to-day success. This market has been here almost 50 years now, and we’re not going anywhere soon. We continue to look for ways to position ourselves for a sustainable future.”

J. Bonafede Co. Inc

J. Bonafede Co. Inc. – Butch Fabio, Gene Fabio and John Bonafede

The market’s varied customer base serves to sustain business. “This market is really a mix of both old and new worlds,” says Jackie Piazza, citrus sales at Community-Suffolk. “The backbone of our market business is everyone all together. The diversity of customers is our stability.”

Boston’s location provides certain advantages in serving a wide geographic customer base and remaining relevant. “Our market has a broad reach,” says Gene Fabio, president of J. Bonafede Co. Inc. “We go to Maine, New Hampshire, Vermont and upstate New York. The regional nature of our business is what has sustained us.”

Changes in smaller wholesale markets has helped support Boston’s business. “Up until 10 years ago we had other smaller regional markets competing with us, but they are now gone,” says John Bonafede, chairman of J. Bonafede. “Their disappearance has made us stronger.”

Merchants credit the market’s location with pushing them to be better at what they do. “We have to be good at what we do because Boston is the furthest market from the biggest shipping points,” says Steven Piazza, president and treasurer at Community-Suffolk Inc. “The people and companies who have survived here are good at what they do.”

Driving Change

Several key trends drive evolution in the Boston marketplace, including the increasing knowledge of customers and consumers. “Today’s consumers are so much more food savvy and knowledgeable than in the past,” says Messinger. “They have higher expectations for fresh, heirloom, local. We are pushed to continue to meet these expectations.”

Restaurants are also evolving from a starched environment to a broader philosophy. “Everything now is farm-to-table, sustainable, local,” says Messinger. “Those are words you didn’t hear five years ago. The classically trained chef idea is also gone. Now we more commonly see chefs with tattoos of pig parts. This is the New Age chef — the old guard chef coming in with his whites and hat is less common.”

“These customers cater specifically to their neighborhood. They are wonderful; very hard working and honest.”

— Steven Piazza, Community-Suffolk

Increasingly, Messinger sees food establishments trending toward streamlined, easily implemented concepts. “We’re seeing restaurateurs trying to do more manageable things,” says Messinger. “Fast-casual is popular. With increased staffing issues, restaurant owners and operators are looking for easy-to-staff concepts, yet still produce good food.”

The marketplace’s staunch competition pushes smaller retailers to develop niches. “Smaller retail stores can have a tough time trying to compete with bigger stores,” says Jim Ruma, president of Ruma Fruit & Produce Co. “The smaller stores have to be more creative to keep the customer.”

Buying habits on the wholesale market demonstrate change as well. “We see more ordering ahead of time instead of buyers getting up early and walking the market,” says Cavallaro. “More buyers are ordering the night before via email or text. However, independent smaller retailers still come in and shop. The ethnic, corner store buyers are hard negotiators, pay cash and come early in the morning — more like the old school.”

Old World With New Management

Boston merchants report Old World-type business — the Mom & Pops and the corner ethnic stores — still represent significant clients, but in a new way. “A reasonable percentage of our business caters to Old World-style companies, but the people in these Old World formats are new,” says Fabio. “Now, our customers include Chinese, Cambodian and Dominicans — those are the people forming the small corner stores. Sometimes these businesses get larger, but their roots come from one store.”

Garden Fresh Salad Co. Inc., catering to a clientele of about 20 percent of the Old World format, has also witnessed this changing of the guard. “Rather than the old Italian stores, now you see Central American or Asian stores,” says Patrick Burke, co-owner. “They’re still serving the local neighborhood; it’s just that the demographics have changed.”

Approximately 20 to 25 percent of Community-Suffolk’s business caters to the single store, family style business — a format conducive to what the wholesale market offers. “A lot of these stores are owned by newer immigrants, including Mexican, Vietnamese, Cambodian and Eastern Europeans,” says Steven Piazza. “They’ve picked up 5,000- to 15,000-foot stores in the city and they shop the market every day. They don’t have a warehouse, so they’re looking for the benefit we provide in storing product.”

Merchants credit these customers with niche marketing expertise and loyal business sense. “These customers cater specifically to their neighborhood,” says Steven Piazza. “They are wonderful customers; very hard working and honest. And, as they grow we’ve seen them working together to combine buying power and make bigger purchases.”

Tailoring Product Mix

Coosemans Boston

Coosemans Boston – Doug Gordon, John Monahan and Maurice Crafts

The diversity of Boston’s Old World meets new marketplace means balancing the needs of both. “We modify our buying with what we are selling,” says Steven Piazza. “A good salesman knows what the product mix should be, given customer demand. We want a good mix to fit the various needs of our diverse customers, from the chain retailer to the restaurateur to the cash and carry.”

One notable shift in the market is the increase in variety in most houses. “It used to be everyone specialized in something,” says Maurice Crafts, sales for Coosemans Boston. “Now, everybody sells whatever they can to get more business with the same customer. For example, just about everybody now sells avocados.”

Steven Piazza notes the supply chain has become more challenging and also affects the players in the market. “There are fewer individual houses, but they’re bigger,” he says. “Between the food safety requirements and the cost of doing business, you need tremendous volume to be successful these days. It has eliminated a lot of the businesses previously just selling one item.”

“Now, everybody sells whatever they can to get more business with the same customer.”

— Maurice Crafts, Coosemans Boston

With the explosion of Boston’s ethnic demographic comes increased demand for more tropical and exotic products. Bonafede now carries more exotics. “Twenty years ago, mangos were not a big thing and Hass avocados came in limited amount in trays from California,” says Fabio. “Now we handle truckloads of each.”

According to Bonafede of J. Bonafede, bananas are still the company’s largest item. “They represent about half our business,” he says. “The other main tropicals we sell include mangos, avocados and pineapples.”

Sharrino of Eaton & Eustis points out this transition is nothing new. “When immigrants came from Italy early in the 20th century, broccoli rabe and many Italian items were specialty, then they became mainstream,” he says. “Many previously specialty items are now mainstream. Garlic and ginger have exploded, for example.”

On top of the ethnic demand, health and gourmet trends also drive greater variety. “It’s no longer a meat and potatoes business,” says Sharrino. “TV food shows and the internet result in a more educated consumer, thus changing the marketplace.”

Baldor’s Messinger observes the explosion of variety on restaurant menus. “Staples such as onions, potatoes and carrots are always going to be part of a menu,” he states. “But, we probably sell more romaine and spring mix now than iceberg, as well as great volume in micro-greens and exotic mushrooms.”

Eaton & Eustis sells more year-round volume in dried fruit and nuts. “Years ago, after Christmas you couldn’t give dried fruit away,” says Sharrino. “Now we have steady volume year-round.” Unique products such as fiddlehead ferns and wild Maine blueberries are highlights of Ruma Fruit & Produce’s business. “We’ve seen new items, especially in organic and specialty products increase tenfold,” says Ruma. “Thirty years ago, no one heard of a fiddlehead fern, now they’re in high demand in when in season.”

Jackie Piazza of Community-Suffolk points to cactus pear as an example of this increased unique demand. “Ten years ago, I wouldn’t have sold it if you gave it to me,” he recounts. “Now, we move about 200 to 300 cases a week.” Coosemans has seen an increase in customers requesting specific products, for example Australian blood oranges. “With the internet, customers are asking for a lot of different products,” says Crafts. “Decades ago, customers bought what we had; now they look online and ask for what they want.”

Adding Value

Boston merchants seek to add value in several ways, one of which includes capitalizing on the brand awareness of customers. “Boston in general is brand-oriented,” says Jackie Piazza. “Customers want the consistency and reliability brands represent. Also, customers report that consumer advertising of some brands helps build demand, for example Halos.”

Cavallaro at John Cerasuolo agrees his customers want particular brands. “They may shy away from a no-name brand, even if it’s really good,” he states. “Sometimes price is a factor, but especially supermarket buyers are label-oriented.”

Yet, options are important, even among brand-demand when serving a diverse clientele. “Each of our divisions offers a top-line label and a value label,” explains Steven Piazza. “The chain stores might want a Dole label, but the cash-and-carry trade might be looking for something less than perfect to sell at a certain price point.”

“Decades ago, customers bought what we had; now they look online and ask for what they want.”

— Maurice Crafts, Coosemans Boston

John Cerasuolo Co. Inc

John Cerasuolo Co. Inc. – Robert DeAngelo, Michael Ferro, Dominic Cavallaro III, Kara Rullo and Skip Cavallarro (seated)

Burke notes the importance of the food safety aspects of branding. “Our brand represents what we do in the food safety area,” he says. “We have a lot more requests for the outside audits we do every year and letters of guarantee. Since we’re a processor, we’ve always had this, but now we see more customers asking questions and demanding more information.”

Boston companies also provide value added via packaging. Ruma has introduced a beneficial packaging for fiddlehead ferns. “It’s a new 8-ounce tray for the fiddlehead with an overwrap,” he says. “This allows shoppers to just pick up the tray instead of sifting through the fiddleheads with their hands. Customers prefer it rather than think other customers have rummaged through the product. It also helps retail lower shrink.”

In another innovative packaging move, Ruma is packaging its Nova Scotia blueberries using the pulp pint with a plastic lid. “On the top of the lid, we put a label with origin and information,” says Ruma. “The plastic lid fits on top of the pint. It looks more sustainable and farm-driven than the typical clamshell.”

Garden Fresh’s Burke perceives the trend, whether wholesale or processed, continues to lean toward packaged. “Less and less volume is sold loose,” he says. “It must be broken down or packaged, or ready-to-go. Romaine hearts are more popular than a whole head of romaine, for example. We’re even seeing peeled and diced pumpkin on the rise.”

As well, Cavallaro notices the shift toward convenience. “The days of buying whole butternut and peeling it are over,” he states. “Customers increasingly want cut and peeled.”

Added Service

With the changes in Boston’s diverse customer base, wholesalers have also changed to address evolving customer needs. Community-Suffolk provides some cross-docking and warehousing for its customers. “We work with customers to meet their specific needs,” says Steven Piazza. “We would rather be involved at the infancy and stay involved than play catch-up.”

Ruma provides delivery and consolidation services for its clients. “Service is crucial,” says Ruma. “If a store is out of product for whatever reason, they need the service we offer. One call and we solve their problem.” Community-Suffolk also delivers to customers. “You either deliver or you don’t get the sale,” says Jackie Piazza. “We have been operating our own trucks and drivers for about 10 years now, but each year we see increasing demand for this service.”

Though the vast majority of Bonafede’s business is still pick-up, it operates trucks and delivers to about four or five customers. “A lot of customers don’t even walk the market anymore,” says Fabio. “They’re looking for additional service from us.”

Baldor often runs second deliveries to meet its customer needs. “We are extremely service oriented,” states Messinger. Pre-conditioning of fruit is another developing service. Bonafede pre-conditions avocados and mangos. “We ripen some mangos for customers who have shoppers wanting a mango with a little give,” says Fabio. “Their shoppers are more likely to shop every day or more days a week than the typical American consumer. They want produce closer to consumption than the standard supermarket fare.”

One service aspect that has not changed in the past 50 years is the buying and selling between merchants on the market. “There is certainly still buying and selling between market houses here,” says Fabio. “If you’re making a sale, and you don’t have enough of the item, you must buy from your competitors. You win, the competitor wins, the customer wins and the market wins. It helps everyone when you buy something and sell outside the market. It strengthens everyone’s hand.”

Moving Forward

Companies on the market work hard to keep facilities up-to-date and particularly focused on meeting food safety guidelines. “We are doing our best to maintain and upgrade,” says Eaton’s Sharrino. “We have new projects coming up, including new water pipes, paving and lighting. We’re going on 50 years and we continuously work to upgrade our facility.”

Solo Produce

Solo Produce – Mario Pallotta, Michael S. Mattuchio and Michael A. Mattuchio

Adam Strock, food safety director for S. Strock & Co. Inc. recognizes how all business decisions are filtered through the lens of food safety. “Food safety has been at the forefront of the produce industry, leading companies to adopt the food safety standards benchmarked by the Global Food Safety Initiative,” he says. “We’re proud to have achieved certification for our food safety program under the PrimusGFS audit scheme.”

Community-Suffolk also takes pride in its GAP certification and other progressive food safety and quality steps. “It can be a challenge to make the changes necessary to move into the future from a facilities standpoint,” says Steven Piazza. “We are paying more attention to detail, such as checking seals and temperature when trucks come in. We’re keeping dry and wet products separate. Everything is computerized and every ticket has a number so there is full traceability.”

Modern technology has transformed the business in a multitude of ways, according to Strock. “These include handling complex orders with ease and lot tracking inventory for traceability,” he says. “The convenience of taking photos, texting and emailing with a mobile phone from anywhere to anywhere has enabled instant communication throughout the supply chain.”

Bonafede has moved to computerized systems. “We have updated inventory and billing software,” says Fabio. “I can now monitor all my storage and even my warehouse refrigeration on my phone.” Companies also harness technology for greater customer convenience. “Baldor has always been into tech, from online ordering to our website to our warehouse management system,” says Messinger. “Online has been huge for us.”