Co-op shoppers and owners –
I wanted to provide the best update on the UNFI supply issues and the impact on TPSS that I have. The unfortunate news is we still have not received a delivery from UNFI since last Friday. Many categories around the store like ice creams and yogurts have dwindling stock levels. The good news is we’ve been able to source a number of items from a variety of secondary suppliers and there are many sections of the store you wouldn’t even know that there is an issue.
The timeline for recovery of UNFI ordering systems continues to be pushed back, and as such I believe this situation will ripple through the natural foods industry for weeks to come. We are continuing to be fully stocked in areas like produce, beer, wine, supplements and grab and go foods. For other departments, please understand specific items may be out of stock and we don’t have a good timeline at the moment for when we expect regular ordering to resume.
As I’m wont to do, I’ll use this situation to illustrate a few points about the modern grocery industry and the cooperative difference. The first is ordering consolidation. We had visitors from a large competitor in the store this morning, assumedly checking out our stock levels. I won’t name the store, but let’s say the owner bares a resemblance in features and deeds to Lex Luthor. That competitor and others in the natural foods world have pushed all their ordering through UNFI in recent years, letting supply agreements with secondary suppliers lapse.
That strategy works if you’re attempting to maximize profits and efficiency by pushing all your volume through a small number of wholesalers, but it leaves you pretty vulnerable if that wholesaler has any kind of supply issues. For TPSS, it’s a big challenge when UNFI has issues like this, but we have 5 other relatively large wholesalers and hundreds of small and direct businesses we can source products from. My guess is our visitors were here to see how our shelves looked compared to theirs given their large reliance on UNFI.
The second is related but distinct in my mind. In the same way that large retailers have consolidated their ordering, the grocery wholesale industry itself has continued to consolidate. Large wholesalers have bought competitors in order to increase their market cap, but that leaves our nationwide food system in the hands of a smaller and smaller number of companies controlling and benefitting from our food consumption.
The first pictures below show sections of the store today that benefit from a large number of distinct, and especially local, suppliers. Our produce and grab and go sections are stocked with foods delivered directly by decentralized companies, and they’re chocked full. On the other hand, our ice cream and bottled water sections are mostly stocked with national brands are struggling with this supply issue.
We’re in an era where there will continue to be disruptions to our food supply chains. Some will be climate related, some geopolitical, and now we can layer in technological as well. It’s inevitable. As a business and as a local food system, it’s imperative to continue to support small makers and disaggregated supply chains. There is a cost to the lost efficiency to be sure, but those regional distributors are far more resilient in times of disruption than the national ones.
This weekend will be a very good one to visually see how much some stores are reliant on a single supplier to keep their shelves full. I’ll continue to update you as we learn more about the timeline for recovery of UNFI ordering, but until then we’ll continue using every option available to us to keep the store stocked. Thanks for reading and for your patience.
-Mike Houston, TPSS General Manager
