Perseverance for Philly Buyers

Originally printed in the September 2020 issue of Produce Business.

Busy independents continue to grow and develop Philadelphia’s diverse marketplace even in a tough year.

The Philadelphia Wholesale Produce Market (PWPM) has experienced a continued evolution of its customer base over the past 10 years. “The trend of who is shopping PWPM has been fairly consistent,” says Dan Vena, director of sales at John Vena Inc. “We’ve seen an increase in more small ethnic retail, more small foodservice distributors and more wholesalers looking to cover their own shorts, quality issues or just relying on us for certain product lines they don’t carry.”

The Market’s geographical base continues to broaden, as well. “Within a 100-mile radius you have a lot of potential customers,” says Filindo Colace, vice president operations for Ryeco. “We hired a marketing person to work with communications and utilize social media and email blasts to reach a larger footprint. It’s a slow process but we’re seeing some positive results.”

Additionally, PWPM serves strong small and medium service wholesale buyers. “They don’t contract-buy and they don’t have a warehouse,” says John DiFeliciantonio, owner of North American Produce Co. (NAPCO). “They come here with their truck every day. They service their customers well and provide tremendous value.”

Solid Produce Retailers

Merchants report the strongest retailers shopping the PWPM now are the ethnic or neighborhood-focused stores. “Our day-in-day-out retail buyers are the independent and smaller stores,” says DiFeliciantonio. “Most are Latino, Indian, Eastern European, Asian, Middle Eastern and various African communities. Large supermarkets are more fill-in.”

DiFeliciantonio reports those customer groups have stepped into the retail business in a big way. “They’re high-volume users and good operators,” he says. “They know the business, they know the product, they’re aggressive buyers and sellers, and they move product.”

Every year, notes Colace, there are more independent-owned supermarkets. “We’ve seen an increase in Asian-American, Mexican-American and Russian supermarkets as well as kosher stores,” he says. “The customers are more and more diversified each year.”

The growth of new immigrant populations drives the development of more ethnic store customers, explains Rick Milavsky, president of B.R.S. Produce. “Those demographics are used to eating more produce, and they push a lot more diversity in produce selection,” he says. “Also, farmers and open area markets seem to be doing more business this year.”

Shifting Effects

Though the mix of customers remains the same, there has been a dramatic shift in the amount of business with various client types. “As everyone knows, while the retail business was booming, the foodservice business fell off dramatically,” says Vena. “That being said, we have been pleased to support our foodservice customers as they adapted to the changing world and figured out how to continue to serve customers both old and new.”

Mark Smith, general manager of the PWPM, observes though there was a reduction of typical foodservice business, the market experienced not only an increase with retailers purchasing in greater quantities but innovative new companies springing up. “For example, check out GrowNGo, a virtual grocery store that delivers right to your door,” he says.

The market has seen foodservice customers making changes in their businesses in regards to different types of packaging and smaller offerings, making home deliveries a new endeavor and trying to replace lost restaurants and school business, explains Tracie Levin, general manager at M. Levin and Co. “Many of the customers in the market who primarily served foodservice establishments have made the switch to providing customized personal use food boxes for public consumption.”

Yet, according to Rick Feighery, vice president of sales for Procacci Brothers Sales Corp., some of the initial home-delivery boom is leveling off. “Many home delivery segments really surged during the initial part of the crisis but have now returned to normal,” he says.

Driving Concentrated Business

The pandemic has been a boom for some of PWPM’s independents and smaller customers, according to the various merchants. “It may be because there has been a preference consumers have for going into a smaller format where you’re less exposed to people,” says Tom Kovacevich, president of T.M. Kovacevich (TMK). “We’re hearing most loudly from our little guys that they’re doing well. We see it in their orders. These smaller customers have always been an integral part of the market.”

Customers are buying more frequently because retail sales are up, according to Mike Maxwell, president of Procacci. “Retailers that used to come in twice a week are now coming in three times a week,” he says.

Another aspect driving buyers to the market is the uncertainty from week to week about the buying habits. “It’s still hard for the FOB buyer/customer to predict what they need,” says Todd Penza, salesman with Pinto Brothers. “They are coming to the market more frequently. They need the flexibility of last minute ordering and pricing.”

Supporting Those Who Support Others

PWPM gives an extra hand to charities working overtime to help people in crisis.

The COVID crisis highlighted an even greater need for the many food banks and charities that have long sourced from the Philadelphia Wholesale Produce Market (PWPM). “The role of non-profits distributing fresh produce to the masses is more important now than ever,” says Tracie Levin, general manager at M. Levin and Co. “People who never before thought they would need help getting food on their tables have come forward and said they need help.”

RJ Durante, sales and director of food safety at Nardella, highlights their commitment to working with food banks. “There are a lot of organizations working with us to repurpose and repackage produce to hand out,” he says. “We are focused on not wasting anything. Food waste is a real tragedy. There is always a mouth to feed and always someone who should be able to take it and do something with it.”

Yet, in the greatest time of need, these food banks and charities faced great challenges. “Charities were overwhelmed by demand,” says Mike Maxwell, president of Procacci Brothers Sales Corporation. “They were having a tough time with labor because they didn’t have the volunteers. They were able to get funding from federal government to be able to hire workers. They’ve all been overworked and underappreciated.”

During this time, PWPM and its companies stepped up to help these crucial organizations. “We continue to donate fresh produce items to those in need, and if they can’t come to us, we go to them,” says Levin. “It is important to realize that now is the time to help those less fortunate than we are.”

PWPM’s biggest charitable partner is Philabundance. “When the pandemic hit, they could no longer physically bring volunteers into the market each week to glean fruit and vegetables,” says Mark Smith, PWPM general manager. “That was a huge hit to their supply of fresh produce. Their diminished presence was a big disadvantage. So, we implemented workarounds, such as encouraging them to solicit the merchants each Tuesday for excess produce and allowing them to bring in refrigerated trucks on Wednesday mornings. We designated a spot in the market where they could sort what was usable.”

Smith reports seeing an uptick in other community organizations needing help. “We offered boxes of produce to various community events,” he says. “Blessings of Hope, for example, has been a huge recipient of produce recently.”

The USDA AMS Farmers to Families Food Box Program is another example of how the merchants at the PWPM are helping feed the needy. According to Smith, three PWPM companies (TMK, John Vena Inc. and Feeding PA’s Mid-Atlantic Regional Cooperative) have won contracts to produce boxes each month.

The Farmers to Families program helped T.M. Kovacevich (TMK) offset some of the loss of foodservice business. “It’s been a win-win-win,” says Tom Kovacevich, TMK general manager. “A win for growers, a win for distributors and a win for the hungry. USDA reports over 50 million cases purchased since June 1.”