Most Los Angeles-area companies that do any foodservice business seem to have undergone some dropoff in sales as consumers cut back on dining out because of the weak economy. But there is at least one exception.
FreshPoint Southern California in Industry, just outside of Los Angeles, has experienced double-digit growth for the sixth or seventh year in a row, said president Verne Lusby.
The company has hired additional warehouse workers and continues to grow despite pressure from customers to hold down prices, he said.
The growth isn’t from increased sales to existing customers. In fact, same-store sales continue to struggle, he said.
Lusby attributes FreshPoint’s progress to a concerted effort to expand its customer base.
“We plug away day-in, day-out for new business,” he said.
Most companies that, unlike FreshPoint, don’t rely on foodservice for a large part of their business say they’ve seen a drop-off, though some sense a rebound starting to take shape.
Foodservice business is down at Commerce-based Fruit Distributing Corp. of California, a consolidator that deals with a wide range of products, including onions, potatoes, beans, tomatoes and oranges, said owner-president Jeff Weisfeld.
Weisfeld attributed some of the downturn to the fact that fewer consumers seem to be dining out, but he’s also noticed another phenomenon — more chefs are buying direct at farmers markets.
“It’s a different world,” he said. “We’ve never seen so many chefs at farmers markets.”
Dennis Berman, president of Bandwagon Brokerage, Los Angeles, said some restaurants that would require reservations a week or more in advance a couple of years ago now can book a seating for 7:30 for those who call at 5 o’clock.
Foodservice business, which consists mostly of specialty items at Bandwagon Brokerage, now is steady, Berman said, but it’s down from 18 months ago, while retail business is up.
However, he said foodservice does seem to be making a comeback.
Organic foodservice sales suffered more than organic retail sales as a result of the recession, said Simcha Weinstein, director of marketing for Bridgeport, N.J.-based Albert’s Organics Inc., which has a branch in Vernon, Calif., just outside of Los Angeles.
“When consumers feel things tighten, one of the first things they cut back is going out,” Weinstein said.
Part of the slowdown is the result of a drop in restaurant business, he said, and part is from chefs adjusting their menus.
There generally hasn’t been a big call for organic produce from foodservice, said Jimmy Matiasevich, sales manager at JBJ Distributing Inc., Fullerton, Calif.
Unless they specifically promote organics, most restaurants tend to shy away from the category, he said. But he added they are ready for the challenge if chefs change their thinking.
At FreshPoint, Lusby said he sees signs of a turnaround in foodservice business.
Chains are planning to add a few more locations this year, which is a good sign considering that they opened few if any new stores in 2009.
It has also been a tough year for restaurants because of shortages caused by an unusually wet growing season and an inflation rate of about 8% for produce, he said.