What the new UNFI-Safeway alliance means to the Co-op
Kenna Eaton, General Manager
First a little background: over five years ago, the Food Co-op joined with many other natural foods cooperatives across the country to form the National Cooperative Grocers Association (NCGA). As a result of this alliance, the NCGA was able to sign a national contract on behalf of its members and collectively we became the number 2 purchaser from United Natural Foods, Inc. (UNFI, previously known as Mountains Peoples Warehouse).
We recently received notice that UNFI, our primary distributor, has signed a new contract to begin delivering natural foods to all Safeway stores beginning October 2011.We were, and still are, unsure exactly how that relationship will impact the Food Co-op and our shoppers.
UNFI is naturally looking at growing and increasing their profitability in a business that has a very thin profit margin. Thus they have turned their attention to building the mass market side of distribution. An additional result was for UNFI to decide it was long past time for them to re-analyze their products: what they had in their warehouses, how much they carried and how they needed to change that mix. And while we knew those changes were coming, we are still unsure what the long-term impact on our Co-op will be.
We are not alone—all our sister co-ops have the same concerns. Recently, NCGA staff held several meetings with UNFI to discuss our concerns and ensure that NCGA members are minimally impacted during this transition. As a result, UNFI has made several commitments, among which is to look at the regional importance of items and to listen to its customers’ requests when an item is tagged for discontinuation. Fortunately, many of the items discontinued so far have not been ones we carry.
Yes, these changes will impact us. So far the impact has been minimal and may remain that way—after all, Safeway has been selling natural foods for several years. However, this issue is really a reminder that we must focus our energies on food security, keeping our dollars local and making sure we walk our talk. The Co-op is thinking also about what else we can do on a larger scale. We’re looking at other wholesalers. We’re talking to other Co-ops in the region. We’re looking at how we can better support our local growers and producers. We’re thinking strategically about the bigger picture. And I can’t help but see it as an opportunity for us to review what we do every day, to look at what we need to do to ensure we have a healthy, robust grocery store for our members and to meet our members’ changing needs.