New York Distributors Get The Job Done While Transforming Business

Standing on recognized expertise, these off market companies are reimagining and investing in the future.

Originally printed in the July 2022 issue of Produce Business.

The crises of the past several years laid the groundwork for a greater role of the New York area wholesaler.

“Our relationships with customers have strengthened after all that has transpired over the past two years because we were still able to deliver the products and services they expect from us at a time when things were very difficult,” says Joey Granata, sales director at FreshPro Food Distributors in West Caldwell, NJ. “Customers look to us to provide them with the right products and good quality, but want and need value in those products.”

Bruce Klein, director of marketing for Maurice A. Auerbach in Secaucus, NJ, believes the local wholesaler plays an even more critical role in the current climate.

“We make sure we have the product,” he says. “We handle all the logistics. The customer calls us and they can get it delivered that day or the next day. Our job is harder, but we try to make it easier for the customer. That’s why the middleman is so important.”

The unique positioning and skillset of regional wholesalers lets them build value for customers and keeps them successful. “We in the middle are a crucial part of what makes the industry run,” says Michael Muzyk, president of Baldor Specialty Foods in Bronx, NY. “We have a tremendous potential for success because we sell health. We benefit so many people and offer solutions to so many problems. We can’t look back; we are looking forward. As Lyndon B. Johnson said, ‘Yesterday isn’t ours to recover, but tomorrow is ours to win or lose.’ And I tell my team we’re going to win.”

And New York off-market wholesalers see customers responding to what they offer. “A lot of our customers are asking for more merchandise,” says Anthony Serafino, executive vice president of EXP Group in North Bergen, NJ. “Some are realizing what we can do for them. It makes me feel confident about our business model. Customers are looking for sources they can rely on, and looking to get more from those businesses who can reliably and consistently supply. They’re asking, ‘Who is getting me what I need?’ This is even more critical with the labor crunch.”

“Everyone always wants more, but I believe customers understand the circumstances and the challenges we face on a daily basis,” says Floyd Avillo, president of FreshPro. “And it’s not just in produce. The challenges hold true in all departments and many other businesses as well.”

There is more appreciation now for service and just getting the job done, agrees Ben Friedman, president of Riviera Produce of Englewood, NJ. “With the lack of labor in the marketplace, every company has been severely affected,” he says. “Customers are looking for companies who can deliver.”

TOUGH OPERATING ENVIRONMENT

Today’s wholesalers are caught in the middle of a demanding market and challenging supply chain. “The buying patterns seem to have trended back to pre-Covid, but everyone is struggling — from growers to wholesalers to retailers — because of high costs of fuel, labor shortages, supply chain issues and weather issues in growing areas,” says Avillo. “And it’s creating major inflation. Consumers at the retail level are not spending freely since they have to cut back because of less disposable income. There are a lot of obstacles at the current moment and it’s making for tough sledding as far as profits.”

The marketplace is crazy with inflation, agrees Serafino. “When the pandemic first hit, the operating climate was riddled with uncertainty,” he says. “But I think this current climate is more difficult than it was in 2020 because we’re now dealing with some of the economic ramifications. Produce tends to have some protection from inflation, but at some point, consumers have their pocketbooks affected and that affects produce purchases.”

The pandemic, combined with current supply chain constraints, result in a complicated interpretation of business. “Current success is a complicated answer in that Baldor’s numbers are strong, both in case count and top dollar sales,” says Muzyk. “But, some of this is due to inflation, so we have to look at package count. It’s also not the same customer base as before. We have a broader customer base because we picked up some business where other competitors might have slipped.”

Pre-pandemic, Vision Import Group in Wyckoff, NJ, was heavily concentrated on the foodservice sector of the industry. “That percentage of our business is now 100 percent back and thriving,” says Raul Millan, president. “The pandemic made us realize we needed to capture more retail business, and that’s exactly what we did. Looking back, it’s one thing the pandemic taught us that will be fruitful for the future: Diversification is crucial in our business. We have always maintained strong relationships with key wholesalers here locally and throughout the country. It was a huge advantage to have those outlets as well.”

Wholesalers report lingering effects in the foodservice industry. “The menus are changing in New York,” says Muzyk. “Restaurants might be using a little less produce because it’s so perishable and labor intensive. Chefs are deciding if they’re going to spend money, to spend it on the center of the plate. It’s a balancing act, as far as foodservice and menu development.”

With the rising food costs, Friedman reports seeing restaurants narrowing menus and using fewer specialty items. “They’re working with less people and have people working less hours,” he says. “They’re looking to simplify the menus and have the kitchens execute what they can.”

Soaring prices at retail in response to supply chain issues also threaten to complicate business. “We believe retail prices will continue to go up,” says FreshPro’s Avillo. “I don’t see any relief from gas prices, cost of labor or finding truckers. Additionally, the industry has to deal with cost increases — fuel, packaging, fertilizers — that growers are facing, as well as water issues in California.”

CREATIVE, FLEXIBLE RESPONSE

Despite all the challenges, New York wholesalers respond in various ways to get their jobs done.
“We’re working overtime to ensure our clientele can get the products they need,” says EXP’s Serafino. “We’re doing everything we can and going the extra mile to get what we need for our customer. This is a tougher environment because the supply chain challenges are just crazy. It’s a very difficult environment to operate in. There are even challenges in getting equipment. I have trucks and other equipment on order, but they can’t be delivered for months or even a year. So, we’re working with what we have in creative ways.”

The staff at Auerbach mitigates the issues in the supply chain for customers, explains Klein. “We do our best to bridge the gap for our customers,” he says. “For example, we see how it takes longer and longer to get ships into port, so we place orders earlier to be able to have an overlap of product.”

Customers benefit from the flexibility of the local and regional wholesale business. “They don’t have to plan out two to three weeks in advance,” says Klein. “They can adjust their orders on the fly. If they need something tomorrow, we generally have it and they can get it the next day. If it was supposed to storm and it doesn’t, so the stores are unexpectedly busy, they can call us. We try to make sure they don’t have any out-of-stocks on items they handle. The current rollercoaster situation of the marketplace has increased the value of this benefit.”

Vision Import Group has seen increased response from customers to its value-added programs, specifically bagging, says Millan. “Consumers felt added comfort with bagged product and I believe this trend will continue. As well, our team worked very hard with our grower partners to maintain quality and service in the hardest of times over the past couple of years. Our customers gained confidence in our ability to do this, even with all the obstacles we all had to overcome.”

Millan says Vision’s customers remain very understanding and pivot with them as challenges present themselves. “The key is to maintain constant, continuous communication and we all can overcome any challenges,” he says. “We encourage people to give us a call and talk about their challenges so we can explore how, together, we can solve them.”

Baldor has moved to reinterpret the application of some concepts such as sustainability, explains Muzyk. “Sustainability is a big word,” he says. “We’re learning today that just like the definition of frontline workers evolved, how we think of sustainability has evolved and it now applies to labor. How do you sustain your labor and how do you make the most of the workers you have?”

A UNIQUE FOUNDATION

New York’s off-market wholesalers have long served the region with a host of products, yet each one has also developed a particular niche or specialty. Auerbach is known for garlic and ginger, EXP for tropicals and exotics, Vision for limes and mangos, FreshPro for fresh cut, Riviera for exceptional execution of service and Baldor for distinctive restaurant offerings. Although all these companies offer a full line of products, their names remain synonymous with these associations.

Every company is known for something, explains EXP Group’s Serafino. “We sell A to Z, but we are really known for tropicals,” he says. “It’s our niche; it’s where we started. Though we do everything, tropical is our forte. There are three items we feel we do better than anybody: bananas, plantains and papaya. Nobody sells more plantains than us. We sell close to 60,000 boxes of plantains a week.”

Vision specializes in providing a consistent source of top-quality produce and industry-recognized brands, such as Mr. Squeeze limes and lemons and Picasso mangos, says Angela Aronica, vice president of sales.

“Above all, we take pride in our exceptional customer service,” Aronica says. “This includes providing thorough and accurate communication regarding market updates, seasonality trends and crop forecasts on a routine basis. We value the relationships built with both our grower network and customer base.”

Most of Auerbach’s customers know the company for garlic and a lot of the root vegetables, such as ginger, shallots and horseradish. “Those are a specialty for us,” says Klein. “We are also heavily into asparagus, limes and baby potatoes. Garlic comes in many forms, and fresh peeled garlic is a huge item for us for foodservice.”

FreshPro’s large facility allows it to serve customers in a variety of ways, explains Avillo. “We have aisles in our building dedicated to many different products catering to customer specifics,” he says. “We try to cater to the uniqueness of each customer. They all have different programs and we try to be as supportive as we can because we understand their need to differentiate their business.”

EXP Group also finds its niche in being a grower, packer, shipper and wholesaler, as well as its own logistics company. “Our customers rely on us because we control our own destiny,” says Serafino. “We pick up our own merchandise from the port, we ripen it and we ship it out. If EXP can’t get it done, then our customers know it’s truly delayed.”

In the farm-to-fork equation, Muzyk says Baldor is not the farm or the fork, but the “to.” “I take a package the last mile in the most expensive city in the country, and I’ve figured out how to do it,” he says. “In New York, it’s a hard last-mile delivery and we are in this space of daily delivery. Our customers can order until 10:30 at night and we bring it the next day. Plus, we offer specialty produce from all over the world, combined with the boutique proteins and other boutique items.”

Riviera Produce holds a niche of agility — something the current climate brought to the forefront. “We’re about a year into recovery,” says Friedman. “Things are better, but not where they were before.”

“And, we see some of the biggest companies still having huge problems making timely deliveries. That has created opportunities for those who are agile and can make the deliveries. Our specialty is our ability to never say ‘no’ to the customer — that on a Saturday at 4 p.m., a customer can find me. They won’t get a voicemail; they’ll get me. And, we will get the customer what they need.”

EXPANDING THE OFFERING

Building on their strong foundation, New York wholesalers continue to push the envelope by developing larger offerings for customers, yet delivering the some quality and service as expected.

“Our produce SKU counts are close to 1,000 SKUs on a daily basis,” says FreshPro’s Granata. “If a customer does business with a broadline distributor, they only get what that distributor has to pick from. We offer so much more and we will even go out and look for items our customers request. So customers get want they want, not just what we have. We service the customer with on-time, quality, and to their specs.”

Riviera offers a diverse and expanding line for customers. “Our customers’ eyes and ears are always open to new products,” says Friedman. “Big corporate and foodservice dining have been moving to fresh cut for years and continue to do that. The white tablecloth restaurants still want fresh. We help ensure our customers have consistency on their shelf.”

Wholesalers are also experiencing growth in organics. “Organic produce is one of the fastest growing segments of our business,” says Granata. “We are committed to offering the highest quality, certified-organic products from local and national suppliers. Our processing division is certified to process and repack organics.”

Baldor operates a full fresh-cut operation, which Muzyk reports has grown due to current labor conditions. “We have seen an increase in demand for our fresh-cut products,” he says. “Our fresh-cut operation has better yields than trying to do it at restaurant level. Operators are now taking advantage of this.”

According to Avillo, FreshPro operates unique capabilities for fresh-cut, such as bulk packs for kitchens and salad bars, retail packs for supermarkets or convenience stores, private label and its own FreshPro brand. “We operate a state-of-the-art facility to provide the highest quality product with food safety assurance,” he says. “We also assist our customers in developing value-added items to their specifications to differentiate product offerings.”

RETHINKING BUSINESS

The past few years have pushed New York wholesalers not just to adapt, but to actually rethink how they are taking their business into the future. “You don’t stand still in business,” says Muzyk. “You’re moving forward or you’re moving backward.”

The pandemic years forced businesses to reinvent themselves and wholesalers stepped up to respond to customer changes. “Before New York closed indoor dining, many of my customers weren’t interested in take-out, home delivery or outdoor dining,” says Muzyk. “To survive until tomorrow, they had to reinvent themselves. As they saw the challenges in the supply chain, they recognized Baldor as their reliable choice. We worked and reinvented alongside them. We now carry a lot more non-produce-related items and our customers have come to rely on and trust us outside their typical purveyors. They rely on us in a different way than they did before, more symbiotic.”

Vision is working to have more of its available product line closer to customers, says Millan. “We’re focusing on a regional, regular, available inventory with the ability to help service more customers just-in-time, instead of the more traditional ports-of-entry distribution model,” he says. “As an importer and marketer of our branded commodities, we are more focused than ever on listening to try to help solve all of our partners’ challenges and overcome the supply chain obstacles.”

In response to customer demand and supply chain issues, Riviera started a division to import products from other countries, and formed relationships with lime exporters from Colombia, says Friedman. “In the last two months, we imported 12 full containers of limes and we started recently with avocados from Colombia.”

Rethinking business for some wholesalers means expanding product lines beyond produce. “We have had to figure out how to do business like we’ve never done before,” says Friedman. “Through COVID-19, we learned we couldn’t only do produce and survive. Out of necessity, we brought in a full line of dairy, cooking oils and salt and sugar. We found we had the relationships and were able to add these items to fulfill our customers’ needs better. We continue to expand our line and are open to other products.”

Muzyk explains how current constraints are changing what customers need. “Spring and early summer is usually extremely bright,” he says. “Ramps, spring garlic and fiddlehead ferns are all an exciting harvest of what our chefs are used to at this time of year. But, now our chefs are telling us they’d like to talk about fiddlehead ferns, but what they really need in the current climate is a good bread source.They’ve always trusted us on the specialty produce side, but now they are trusting us to look for those other boutique food items.”

INCREASING TECHNOLOGY AND INVESTMENT

The pandemic sped up the technological adaptation among the New York wholesale community. “The pandemic started it and the current supply chain issues continue promoting it,” says Serafino. “Customers are asking who they can rely on if they want uninterrupted supply. Companies who are on track with that, such as we are, find the need to invest more to keep themselves on track and respond to this customer demand.”

EXP Group is investing capital in quality control applications, working with Famous Software, says Serafino.

“And, we’re making our processes much more digital,” he adds. “For example, we have an app where our customers can order produce. They can also log onto our website and place orders that way. EXP Group has long worked to be a leader in this space. It’s important in B2B. For example, if there is a supermarket chain with 25 stores, each produce manager can log in and order what they need.”

As most of Vision’s staff became remote in response to the pandemic, the company evolved by incorporating different means of communication to maintain the required level of internal collaboration. “This includes the use of Teams and Zoom video conferencing, as well as WhatsApp,” says Aronica. “Additionally, we have revamped our social media presence in order to expand our network, as well as our influence within the industry.”

FreshPro has invested heavily to ensure the integrity of its state-of-the-art warehouse. “We maintain the cold chain throughout the entire process, from receiving through processing and until delivery,” says Avillo. “We have the highest certifications for food safety and product integrity with a third-party certified, modern HACCP facility that is monitored daily by quality assurance.”

EXP Group is also making capital expenditures to invest in the physical space of the company. “We built six more ripening rooms for a total now of 35,” says Serafino. “We’re planning to build more to get to 42 ripening rooms within the next 12 months. We added 25,000 square feet in cold storage and are looking to expand 30,000 more to take us to almost 100,000 in our facility here. We’re making a lot of capital expenditures in cold storage and logistical expenditures.”

Baldor continues to invest in upgrading operations. “We have been through many different system upgrades over the years, from DOS-based to Windows,” says Muzyk. “During that time, we realized our biggest advantage was to decrease paper. It’s already an orchestrated ballet of chaos — if I still picked orders by paper, it would be a train wreck. Technology was already in play to give the selectors a handheld device, and tablets have always been our goal to capture electronic signatures. We’re looking at how we can use technology to continue to revolutionize our business.”

Equipment investment is another area where Baldor is moving forward in response to the current climate. The company just invested in 10 wrapping machines. “We are about ready to put them online and it will allow us to repurpose 50 people to other positions,” says Muzyk. “That’s taking advantage of one piece of technology to better the working conditions of our employees.”

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Investing In A New Generation

New York wholesalers are not only rethinking business with expanded lines and investment in technology, but are also investing in the next generation of produce professionals.

“We are moving forward and preparing people,” says Bruce Klein, director of marketing for Maurice A. Auerbach in Secaucus, NJ. “We have focused on getting some younger blood in. Josh Auerbach has been lending us the next generation perspective for years now.”

Auerbach also hired family member John Venables last year to work in sales and some other company areas. “He’s onboard to help take us into the future,” says Klein. Venables earned an MBA from DePaul University in 2019, and spent the last two years in a finance role at Northwestern University. Prior to his MBA, he worked at a Chicago private equity firm and led them through a digital transformation.

“It’s good to get the new generations involved and prepare for the future,” stresses Klein.

In North Bergen, NJ, EXP Group’s Executive Vice President Anthony Serafino is another example of NextGen leadership, and has been working for eight years with the company. “We have to constantly stay evolving,” he says. “The produce industry has a lot of multi-generational families and a lot of youth coming into the industry.”

Serafino has learned from watching his father operate his companies, and then incorporates his own take. “I don’t try to rock the boat,” he says. “ A lot of successors like to ‘tear down the wall and rebuild it themselves,’ but maybe the wall just needs a few repairs. It’s a lot of responsibility — we have a few hundred employees onsite — and we pride ourselves on being a leader.”

Current leaders rely on the next generation to help move companies into the digital arena. “When I was a chef, I stretched the phone cord out the back door and used a yellow pad to write my orders,” says Michael Muzyk, president of Baldor Specialty Foods in Bronx, NY. “The younger generation of chefs came along and requested a website for ordering. So, my nephew came onboard after graduating college for web design. Our website has evolved over the years, pushed by each new generation to turn it into a rocket ship. That younger generation is also pushing us for what we’re doing on social media. How are we telling our story?

“The next generation is impelling us to do bigger and better things. They are absolutely bringing change.”

At Vision Import Group in Wyckoff, NJ, not only is the company promoting the younger generation of industry professionals, but it also has a strong female presence. Angela Aronica, vice president of sales, has been with the company for five years.

“We represent and encourage diversity within the workplace,” she says. “As the industry continues to evolve, we hope to continue to develop and strengthen our team with the skills needed to navigate the volatile world of produce. As our vision states: Todos tenemos que comer — ‘we all have to eat.’ Vision Import Group is preparing a new generation to carry on that legacy.”