In for the Short Haul

Careening fuel costs and demand for eco-friendly product are causing sharp swerves on the food distribution highway. Katy Keiffer spots some green lights at the end of long-distance tunnels.

Posted: June 23, 2008

Stop to think about how much the food landscape has changed in just the past decade. Look a few years beyond that, and, believe it or not, there was a time when olive oil was Bertolli or Berio—period. French beans were something you ate in France, and tomatillos? Don't make me laugh. But these days, products like artisanal olive oil and cheeses, along with exotic fruits and vegetables, are expected to be widely available. They're no longer the province of the specialty market; even the humblest grocery store chains now carry a wealth of ethnic ingredients and produce to serve an ever more diverse population.

In the 1970s, Frieda Caplan of Frieda's in Los Alamitos, California, a visionary in the produce business, began bringing in and marketing new and unfamiliar fruits and vegetables. Her work dovetailed with the West Coast culinary innovations of Jeremiah Tower, Alice Waters, and Wolfgang Puck, to name a few. On the East Coast, the late '70s and early '80s brought the French invasion. Chefs like Jean-Louis Palladin, Gray Kunz, Daniel Boulud, Gilbert LeCoze, and Eberhard Müller imported their European expectations about ingredients to American kitchens and were not happy with the status quo. Who hasn't received a case of filthy bruised greens and cursed the amount of time it would take to render them edible, not to mention the waste. Chefs began demanding more variety and better quality products for their restaurants. Distributors who wanted to stay competitive had to pay attention. The news of meals served in great restaurants trickled down to the public, who wanted to use those same groovy ingredients at home. When you add the proliferation of food magazines, Food Network, and increasing access to product, it's clear that the American food revolution wrought a sensational transformation of our culinary landscape.

Henry Wainer, of New Bedford, Massachusetts–based Sid Wainer & Son, an importer and distributor of specialty foods and produce, attributes the transformation in the distribution business to three things: transportation, food safety, and the cold chain. According to Wainer, the cold chain would have been "almost impossible 30 years ago. Thanks to advances in technology, such as the introduction of Ryan recorders, which monitor temperature in product en route via satellite, distributors are now able to locate and bring virtually any food from anywhere. In fact, they find things you didn't even know you wanted, but of course now you do."

Wainer also points out, "Food safety changed the dynamics of the food chain; there was the big grape scare in the '70s, and suddenly we had new regulations on chemical use, and hot dogs started to be served up by workers wearing rubber gloves."

The success of food safety regulations in the United States is often overlooked when scary things like the Westland/Hallmark Meat Company beef recall happen. But the progress here and abroad in the monitoring and enforcing of food safety standards has had a major impact on our access to ingredients worldwide. Other countries have been forced to follow our lead in mandating food safety guidelines, or we won't do business with them. Moreover, many distributors have their own programs in place to ensure product safety from every vendor, large and small, in addition to what is required by the USDA.

Another significant development for distributors is the necessity of partnering with their customers: not just responding to requests for quality product but also encouraging local agricultural endeavors, creating green-energy initiatives, and supporting philanthropic outreach, depending on the size and type of a given distribution business.

As Bill Lewis, vice president of marketing and street sales of U.S. Foodservice, remarks, "Anyone can pull up with product. That is not enough these days." U.S. Foodservice is aggressively developing other ways to work with its customers, speaking of these programs as "partnering beyond the plate." U.S. Foodservice is one of the largest broad-line distributors in the United States. It has committed itself to providing service beyond its customers' expectations. In addition to the Food Innovations program, whereby specifically requested esoteric products are located and delivered, it also offers support in training waitstaff, measures trends for menu development for its restaurant customers, and assists its clients in leveraging better rates for credit card services and health insurance.

As you might guess, fuel prices are clobbering distributors right now. That is another major impetus driving them to find new ways to work with local or regional suppliers, as well as their customers, to reduce costs. Many distributors are outlining new strategic initiatives to respond to the demand for both local products and more energy efficient business practices.

As a major player in the distribution business, a company like U.S. Foodservice should be credited for identifying opportunities to save on fuel by sourcing locally and working to build up regional distribution networks. It is planning new routes so that its trucks carry a full load outbound and inbound to distribution centers, instead of traveling empty on a return trip. It offers biodegradable and compostable packaging through many of its divisions, and the number increases daily. Perhaps most impressively, Rachel Sylvan, manager of corporate responsibility and sustainability, explains, "We have signed a three year commitment with the Environmental Protection Agency's SmartWay Transport Partnership to increase fuel efficiencies. There are a lot of ways to save energy, and we're doing that in partnership with the EPA."

Sid Wainer & Son started in business in 1914 and has been building its relationships with the agriculture sector, locally and around the world, ever since. It is fully committed to saving energy by reducing the distances its food travels. To that end, one of its most significant initiatives is to have established its own farms, in 2001. In addition to buying from other suppliers, it now owns considerable acreage and a number of greenhouses that supply its customers. Working regionally has meant that, for many customers, produce picked on a particular day is only six hours away from their restaurants, and diners are benefiting. The company has reclaimed a thousand acres slated for development and is turning that acreage back into arable land. It also has an extensive recycling element to cut back on waste and has instituted a reusable-tote program to reduce the number of boxes and the amount of corrugated cardboard used in moving food.

Baldor, another specialty foods importer that focuses on supplying restaurants, began sending its salespeople to the greenmarket in New York City's Union Square in the '90s to start building local relationships. As Gene Mayer, vice president of sales, says, "If you're not green and growing, then you're brown and dying!"—a perfect metaphor for a business that is changing as rapidly as the food industry. Like Sid Wainer & Son and others, Baldor works directly with farmers in advising them on food trends in the restaurant industry and helping them decide what to plant. It now has a brand, Catskill Mountain Produce, that buys up all the output of a cooperative of farms in the Catskills and the Hudson Valley. It also has partnerships with farmers on Long Island and in New Jersey.

One of the most successful of these partnerships is between Baldor and Eberhard Müller of Satur Farms on Long Island. Müller is a former chef at high-profile restaurants like Lutèce and Le Bernardin. Accustomed to a much higher quality of product than what he was being sold, he found that his solution was to take a more proactive role. "When I was at Lutèce, I began to contact people I had heard of or met, and I sourced as locally as possible. The farmers' market was not enough to supply a large restaurant, and it was not convenient to go every day," he says. His wife, Paulette, and he bought their farm because his local sources were unable to meet his demands for the restaurant. Paulette, who has a degree in horticulture, grew crops to his specifications. Anything he didn't use, he sold to his colleagues in the restaurant world.

As his farm became more successful, he teamed up with Baldor, which essentially performs as an arm of his farm, giving him a far greater reach without his having to invest in trucks and transportation. What ever product doesn't go to Baldor, he sells directly to area restaurants and to J. Kings Food Service Professionals, a distributor on Long Island.

According to Müller, "a trailer traveling from Long Island to the New York area costs about $700. A trailer coming from California costs around $8,500." Henry Wainer has calculated that one trailer from California burns 1,100 gallons of fuel. Sid Wainer & Son have lowered their shipping costs substantially by developing their own farming programs and greenhouses and buying from local producers in the Northeast. More farms in the same region are finding ways to extend their growing season, through the use of greenhouses or the planting of winter-hardy crops. Programs like these reduce the need for costly transportation from other regions.

Steve Schimoler, chef/owner of CROP Bistro & Bar in Cleveland and a tireless entrepreneur, has come up with another model for restaurants and farmers. His solution was to create a network of restaurants and suppliers, called LocalCrop, and connect its members with Sysco, the nation's largest distributor. Their program will launch officially this month.

Like many chefs, he had developed relationships with numerous small farmers and artisanal producers. Placing orders with each of them required dozens of phone calls and took up valuable time. Schimoler also recognized that the small farmer or artisan was spending as much as 30 cents on the dollar to transport his food. Aside from the cost of transportation, credit risk was involved for farmers who worked with so many customers. Invoicing and trucking were eating away at time and profits.

Working with Sysco obviously gives farmers many more customers and offers them a level of stability that will help them grow. At the same time, restaurants can also be more efficient with time because all their supplies, including local product, come from one source. To ensure the integrity of the product, chefs participating in the program can work with farmers on core food safety, soil testing, and efficient packaging. As Schimoler says, "The best thing will be that there's enough demand that smaller outfits can commit to a greenhouse system. If the demand stays high enough, farmers can afford to make the investment and grow things that are not normally available in the winter months."

The upside for Sysco is in fuel economy and better customer relations, as well as greater visibility as a supporter of regional agriculture. "Local food should not be an elitist thing, which it has been in the past. The win-win is the local Applebee's buying locally and communicating that to the customer," says Schimoler.

Ultimately, Schimoler expects that LocalCrop as a concept will be rolled out with Sysco in other major cities in the United States over time. More information can be found about this on their Web site www.localcrop.com.

Now that there is an appetite for high-quality local produce, Mayer says, the new trend in the consumer sector reflects "a reverence for where food comes from and what seeds are being used." Consumers are hyper-conscious of the labels employed so freely nowadays in fine dining: grass-fed Holstein beef from here, crushed shell beans from heirloom seeds from there, and so on. Part of this interest in origin stems from the fact that consumers can feel more proprietary about the food because they are knowledgeable about the sources. (Offering the backstory to customers is a tactic more chefs are using to cement their patrons' interest and loyalty.) But much of this trend reflects the willingness of the distribution network to respond to the demand from chefs and, increasingly, from consumers for local, seasonal, and eco-friendly products.

Aside from reducing the carbon footprint and supporting regional business, the practice of working closely with small farmers has gone a long way toward revitalizing family farms, a population that was being written off as antiquated and irrelevant only a few years ago. Pumping money into a regional economy helps everyone and represents good business practice from any point of view.

Access to the variety of products from faraway lands is one of the great gifts of the past couple of decades. An even greater boon is the remarkable metamorphosis in the supply and distribution of foodstuffs in this country; it is likely to continue. More produce and meat will come from places closer to where it is ultimately consumed, as it should. But as Schimoler points out, "'Sustainable' means nothing if it doesn't mean sustainable business. It's the big companies like Sysco that can really move the needle toward change." The more we support efforts like those described here, the better our food will be and the more economically stable and independent we'll become as a nation. It's just good business.