Originally printed in the December 2018 issue of Produce Business.
A steady reputation, relevant variety and diverse customer base provide a solid foundation for boston wholesalers’ continued growth.
As one of the oldest market facilities on the East Coast, the produce market in Boston has a sturdy heritage dating back to colonial days. This longevity, combined with its locale, contributes to continued success. “The advantage of our market is everybody knows where we are because we’ve been around for so long,” says Steven Piazza, president and treasurer at Community-Suffolk. “And at this facility, everybody has plenty of room to operate, including interior space and yard space for trucks, piggybacks and freight cars. Our location draws from every major chain store on the East Coast, all the mom-and-pop stores and a variety of foodservice customers.”
Known since 1968 as the New England Produce Center (NEPC), the market has invested decades in ensuring a reliable reputation. “Our customers know we have a consistent business,” says Kara Rullo, manager for J. Cerasulo. “Everybody considers us a reliable source. We focus on doing business as usual because what we’re doing works.”
The strategic geographic position of the market aids in attracting and serving customers. “The market is close to the city and close to the suburbs,” says Anthony Sharrino, president of Eaton & Eustis Co. “It makes it convenient and easy for buyers to get in and out of here.”
Paul Travers, president of Travers Fruit, notes how the NEPC’s convenient location near many local thoroughfares and highways allows access for everything from small vehicles up to large commercial shipping vehicles. “We are also on a railway system, allowing for deliveries via train,” he says. “Our facility has tremendous refrigeration areas. We have updated all of our refrigeration systems to ensure we provide the freshest products to our customers.”
The market’s location results in efficient just-in-time turnaround for customers. “The fact that businesses, especially restaurants, can order this morning and have stuff delivered to them by mid-morning or early afternoon is key,” says Patrick Burke, co-owner of Garden Fresh Salad Co. “It takes the guesswork out of ordering and eliminates need for storage.”
Though faced with challenges of an aging building, tightening markets and industry-wide weather and labor issues, the Boston merchants continue to draw significant customer traffic in both foot and truckload customers. “Over the decades, we’ve seen the disappearance of the smaller regional markets, so that traffic is coming here now,” says John Bonafede, chairman of J. Bonafede & Sons.
The market is essentially the only terminal in the region now, agrees Robert DeAngelo, office manager for J. Cerasulo. “It’s the only place where people can get variety and price comparison in the same spot,” he says.
This one-stop-shopping concept yields buyer benefits in terms of relationships, pricing and flexibility. “Our merchants have long-standing relationships with suppliers, can buy in large volume and do a good job offering competitive pricing,” says Rullo. “The flexibility of volume and pricing on this market is an advantage for the customer because they can really respond to market changes.”
Glenn Messinger, general manager of Baldor Boston in Chelsea, MA, says the market is crucial to Baldor’s business. “We have an outstanding relationship with our produce vendors in the NEPC,” he says. “Many of my vendors there are our backbone and really support our business.”
A Booming Marketplace
Market merchants find themselves in the midst of a roaring Boston food environment driven by foodservice. “Boston is booming,” says Messinger. “There is no shortage of new restaurants. We see a lot of new fast-casual chains coming into town — anything in fast-casual is really growing, but especially barbecue and healthy alternatives.”
The biggest issue driving foodservice decisions right now according to Messinger is labor. “Labor is a huge problem, and a lot of owners are moving to simpler concepts to deal with the labor issue,” he says. “That may be another reason for the fast casual boom since you don’t need classically trained chefs for these. Because of this, we’ve seen an increase in prepped and pre-cut demand to supply these types of operations.”
On the retail side, the Boston area continues to support a wide variety of stores. DeMoulas Supermarkets, with its Market Basket stores, and the Stop & Shop Supermarket Company hold the highest market share at 23 percent and 18 percent, respectively (according to Chain Store Guide’s Market Share Report). Albertson’s grabs a 12.7 percent share with its banners Shaw’s and Star Market. The rest of the market is divided up diversely among many formats, including Whole Foods, BJ’s Wholesale, Walmart, Costco, Hannaford, Roche Bros., Trader Joe’s and Wegmans – all posting from a 7- to a 2-percent share. At less than 2 percent fall Big Y, Target, Dollar Tree, PriceRite, Crosby’s and other small and independent operators.
Gene Fabio, president of J. Bonafede, attributes the continued wholesale market relevance to the diverse customer base. “We have a well-established, varied customer base,” he says. “A lot of people are being fed through this market. We have higher foot traffic because there are a lot of smaller, especially ethnic, stores who shop here.”
Merchants see this customer diversity reflected in product demand. “Our customers continue to demand the very best quality and freshest produce,” says Travers. “We also continue to have foodservice industry customers that prefer a value product. We offer opportunities week in and week out with quality, competitive pricing and outstanding service, keeping our customers loyal and always coming back for more.”
Evolution of the Ethnic Demographic
Boston, like many U.S. cities, continues to enjoy growth of the ethnic demographic.
“We continue to see a trend of ethnic diversity and increasing ethnic customers,” says Fabio. “Our ethnic customers buy a lot in the market and do a good job.”
Maurice Crafts, co-owner of Coosemans Boston, reports serving numerous ethnic customers, including ethnic wholesalers. “We do see an evolution of some of the larger ethnic customers going to other distributor wholesalers but the small and medium guys are still coming in and paying cash,” he says.
Boston’s ethnic retailers range from multi-store chains to one-unit operators. “We supply produce to purveyors from many ethnic backgrounds, servicing major supermarkets all the way to local food carts,” says Travers.
One notable trend described by Boston merchants is the relocation of ethnic groups to the suburbs, thus resulting in larger suburban ethnic stores. “As the Boston real estate market goes crazy, the ethnic population is being squeezed out of downtown, and suburbs close to Boston are growing with ethnic markets,” says Piazza. “There might be an Indian store in one town or a Russian store in another town. Because they don’t have warehouses, they shop the market every day or multiple times a week to take advantage of what we can offer them.”
Retailer India Market is a good example of a store that started small and has grown into larger suburban stores. Yousuf Bokhary, president of India Market in Shrewsbury, MA, reports a growth of families in the suburbs. “In the long term, we have seen families move to the suburbs,” he says. “This has resulted in us putting up a suburban-style store but still focused on an ethnic market.”
Other examples of this growing trend include: Julien’s Market in Waltham, MA, and Vicentes Supermarket in Brockton, MA, both serving the Haitian community; V-Mart International Market in Lowell, MA, serving the Asian community; Seabra Supermarket, with three locations serving the Portuguese and Brasilian demographic; and Mexi Market in Marlborough, MA, with a Mexican and Latin American clientele.
Variety and Specialty Trends
Boston’s continued customer diversity drives variety in product offering, as well, on the part of the Boston market merchants. Bonafede carries a wide array of products. “We offer 130 items on average, a lot of it catering to the ethnic communities,” says Fabio.
Bonafede also offers a full line of dried peppers. “They are good because they don’t go bad and are used a lot,” says Fabio. “We also see movement in yucca and tamarillo.”
Companies continue to increase business in particular products exhibiting high growth rates or future potential. Fabio reports continued growth in Hass avocados. “It is steady and increasing,” he says. “More and more Americans are enjoying avocados and, combined with the ethnic trade, aggregate demand has been increasingly steadily.”
Boston Tomato sources and imports herbs from numerous sources. “We have a steady supply of high-quality herbs,” says Marcela Rovere, buyer/manager for herbs. “We can pack and deliver the same day. This is a great advantage for our customers who value freshness.”
Coosemans varies product offering from season to season. “We brought some exotic fruits in September including rambutan, dragon fruit, pomegranates and guava,” says Jack McGinn, sales. “These are becoming more popular especially at certain times of year. We handle other products seasonally, for example, more citrus in December through February.”
Travers Fruit also experiences diversified sales. “Along with the daily berry, fruit and onion demands, there is a growing demand for oriental cabbages and bok choy,” says Travers. “Seasonally, we also offer multiple sizes of cups/trays of pre-cut fruit.”
Ruma Fruit & Produce Co. has established a niche marketing ramps, fiddlehead ferns, and wild Maine blueberries. “Fiddleheads are up 8 to 10 percent over last year,” says Jim Ruma, president. “We are offering an 8-ounce tray now, using a high-graphic color label with preparation instructions, a website and a taste summary.”
The season and availability for fiddleheads depend on the weather, according to Ruma. “It’s usually May and June, but some years we’ve gone as late as July,” he says. “Sometimes it starts early if there’s no snow, such as late April.”
Ruma reports consistent and increasing demand for wild blueberries from Maine. “We see very regional demand because you can’t ship them too far,” he says. “We pack in a pulp pint with a plastic dome cover, giving a farm-stand fresh feel but still protecting the product.”
Shift to Pre-Cut
One notable change in product mix is the continued growth of prepared foods, in part driven by consumer lifestyles, according to J. Cerasulo’s DeAngelo. “There are less stay-at-home mothers who cook from scratch, and this has affected the business,” he says. “Thirty years ago, during the week of Thanksgiving you’d sell 500 boxes of sweet potatoes a day. Now, if you sell 20 a day, it might be a lot. Now, consumers are looking for value-added products instead.”
Changes in the foodservice labor market also drive greater demand for prepped or pre-cut produce. “With so many new restaurants and a shortage of qualified people to work in those restaurants, operators are looking for solutions,” says Burke. “It’s a competitive labor market. We are stepping in to help these operations with all the different cuts and products we offer.”
Labor has been an issue in this area for quite a while now agrees McGinn. “Wholesalers began looking for more for prepped product as of 10 years ago, so it’s nothing new but the trend continues,” he says. “Coosemans has done well with peeled pearl onions, peeled cipollini onions and snipped green beans.”
Burke reports Garden Fresh is catering to a lot of special requests in foodservice. “Buyers are looking for things they can’t get somewhere else,” he says. “Different cuts, special pack sizes. That helps the restaurant have greater consistency with their product. It’s better for a machine to cut than a person for a variety of reasons.”
And foodservice labor isn’t the only labor issue affecting produce. The biggest challenge the last few years has been finding warehouse labor and truck drivers, reports Piazza. “In the current economy, anyone who really wants a job has one,” he says. “We’ve been fortunate enough to retain labor and we’ve been able to cultivate second- and third-generation employees here.”
Transportation is a huge challenge for the industry concurs Sharrino. “Lack of drivers is a significant issue,” he says. “The Wall Street Journal reported this country is short about 100,000 truck drivers. Increasing regulations make it even more difficult and add to delay of shipments. We have to think a little more ahead now.”
Travers reports any company who relies on the trucking industry has been affected by the fairly recent Department Of Transportation regulation updates. “However, our close relationships with shippers and logistic companies have ensured our customers always get all of the freshest products they may need,” he says.
Striving to Meet Strict Standards
Multiplying regulations and requirements involving food safety also present challenges, especially for an aging facility, yet Boston merchants invest significantly to stay on top of requirements. “Coosemans Boston takes food safety very seriously,” says Crafts. “Our traceability and the way we sell by lot are advantages.”
J. Cerasulo has completed certifications through Primus GFS. “Especially supermarkets such as Stop & Shop and other larger distributors require this,” says DeAngelo.
Boston Tomato is GAP certified. “That is very important these days for our customers,” says Rovere. “We are also certified organic.”
Travers Fruit has invested in a new software system that enables the company to track all of its produce. “Our shippers continue to have all GAP- and USDA-inspection certificates, among other certifications,” says Travers.
Companies report more frequent and stringent requests from customers for certifications.
“You must keep track of the product and provide good traceability,” says Ruma. “It’s especially important when trying to sell a new customer to have those certifications in place and demonstrate your commitment to food safety.”
McGinn notes Coosemans has had more requests for copies of its third-party audits. “We’ve done audits for many years now,” he says. “It’s something we take quite seriously. Some customers have stopped doing business with wholesalers who are not certified. The larger wholesalers and buyers require this and can’t buy from anyone who doesn’t operate according to their own HACCP plan.”
McGinn also reports documentation has grown considerably over the past couple of years. “More and more of our customers are asking for copies and sending us their own paperwork to fill out listing what we do,” he says. “I spend a lot of time filling out our customers’ forms to match their food safety requirements.”
The amount of documentation and paperwork the customers are looking for is increasing, agrees Burke of Garden Fresh. “We’ve always been certified and on top of meeting food safety standards because we are a processor,” he says. “However, the depth the customer is asking for is expanding.”
Piazza of Community-Suffolk notes challenges for the Boston facility with the constantly evolving food safety laws. “These buildings weren’t designed with current food safety standards in mind,” he says. “So, it’s challenging and expensive to modify the warehouse to get the certifications. We continue to investigate what will be needed in the future to meet future standards.”
Fabio notes it can be a balancing act. “We invest the money to meet buyer demands, but the question is if they will purchase enough to warrant it,” he says. “It remains challenging to continue to meet multiple certifications/standards demanded by different customers.”
Looking to the Future
The companies of the NEPC are already working toward future improvements. The market recently added solar arrays to the roofs of the four buildings on site, relates Travers. “Also, there are many refrigerated storage trailers on site that have either been replaced or upgraded to ensure the least amount of emissions into the environment as possible,” he says. “We strive to do everything in our power to protect the land and the environment that sustain this industry.”
The market has a full recycling program for pallets, reports Piazza. “We chip those that are disposable and sell to a paper company,” he says. “We separate the compostable and the cardboard. And have a good program to minimize the waste. We are making this effort to minimize our costs in waste.”
Sharrino relates the market is looking at other infrastructure changes, as well. “We’re going to update the storm drains and water pipes and eventually repave,” he says.
Companies off the market are also making moves for the future. Baldor Boston is developing a new facility on the other side of Chelsea from where they are currently – about 1 mile away from the NEPC. “We are staying in Chelsea because the market is down the street and we rely on those guys for our business,” says Messinger. “Also, our employees are here.”
Messinger estimates the new facility should be move-in-ready by March. “It’s 100,000 square feet on seven acres and will have 37 loading doors and five temperature zones,” he says. “It will have the latest technology to manage the refrigeration systems.”
The facility, according to Messinger, will allow Baldor to expand its delivery area. “It will also allow us to better buy product since we will have more space,” he says. “We can be more efficient both in bringing product in and sending product out and, we’ll have greater capacity to bring in more new and unique items.”
NEPC – Steeped in History
Boston’s wholesale market traces its roots to colonial Faneuil Hall and Quincy Market, now one of Boston’s most popular tourist attractions.
Thirty years before the Revolutionary War, Faneuil Hall was established to provide Boston area farmers a place to sell their fruits and vegetables. The Faneuil Hall market area, which included Quincy Market, served as a produce distribution center until 1968, when the New England Produce Center (NEPC) was built in Chelsea, MA.
In 1966, the mayor of Boston decided to redevelop the Faneuil Hall area, including the surrounding buildings, explains John Bonafede, chairman of J. Bonafede & Sons. “The city required businesses to sell their property to the city and look for new space, pretty much forcing the merchants to come up with the concept of building a new market,” he says.
The Faneuil Hall/Quincy Market merchants joined forces with other companies who at that time were operating in a South Boston market area. “The receivers who sold rail car were in South Boston,” says Bonafede. “The downtown market was more for truck or boat receivers. The downtown merchants joined with some of the South Boston companies to develop a ‘new’ facility that would become known as the New England Produce Center. The facility was completed in February 1968 and was the most modern facility at the time.”
When the NEPC opened in 1968, there were about 50 companies who moved to it from the old markets and around the area. The “new” market soon became a destination. “The merchants who did not come to the new location were soon suffering in business because the new location provided a one-stop-shop for the buyers,” says Bonafede.
The new market provided the owner-companies with an opportunity to offer something more to their customers. “When the wholesalers knew they had to leave the downtown area, they formed a group, bought the land and figured out what they wanted in the new market,” says Dominic (Skip) J. Cavallaro Jr., president of J. Cerasulo. “They used it as an opportunity to modernize and build better facilities for their business.”
Several of the companies still operating on today’s market date their roots back to the Faneuil Hall/Quincy Market era. Of the 27 companies on the market now, Bonafede estimates 21 were part of the original group in 1968.
Steven Piazza, president and treasurer at Community-Suffolk reports his grandfather started the business around 1930 in the basement of one of the colonial buildings. “When he first started, he was the first to wash and wrap fresh celery,” he says. “Over the years, as his brothers came into it and the family grew, the commodities handled grew as well.”
Eaton & Eustis Co. was also on the Quincy Market. “The company was established in 1880 and my grandfather and his brother bought it in 1910,” says Anthony Sharrino, president. “In those days, they received a lot from Cuba and Puerto Rico including citrus fruit and pineapple. The business operated there until 1968 when we moved to the NEPC.”
The New England Produce Center now supplies wholesalers, retailers and food service customers serving more than eight million people located in an area bounded by Connecticut in the South, to the Canadian border in the North and all the Maritime Provinces of Canada in the East, and to Albany, NY, in the West. It is the largest privately owned terminal market in the country.