Letter Re: Some Changes in American Wholesale Food Distribution

I have a good friend who is an executive in the "food distribution business". They supply restaurants, schools, hospitals, day care centers, nursing homes,,,,,the large quantity food purchasers.

This past week at their annual sales meeting, they were informed of coming changes.

#1–Most food has been delivered in #10 [96-ounce] or one gallon size cans. [The rolled steel for] most of these cans[is] made in China and the cost has increased dramatically in the past several months because of rising steel prices. Effective December 1, the price on an individual empty #10 can is increasing by about 75 cents per can. This means that whatever is in a case of food (six cans) the price will be going up by about $4.50 per case just because of the can price. On some products, the price increase will be as much as 25% because of the can price increase.

#2 In an effort to offset the rising price of cans, many food distributors are making a concentrated effort to switch customers over to buying frozen foods instead of canned foods. The big move is for customers to install commercial food freezers (costing between $3,500-to-$7,000 per location) where they can store frozen food instead of canned foods. The feeling is that with increasing prices on "canned" goods, there will be a long term savings by going to frozen products.

This could have a major impact on the folks that wish to store or stockpile "survival" supplies in cans if emphasis moves to frozen foods. It will also present an interesting situation if we have a major problem with the grid, tons of food would go bad in a very short order.

#2 Small customers and customers in remote locations will be gradually phased out of the delivery system. Delivery costs and diesel prices have made it impractical to service this type of account. I wonder if the same decision will be made about small rural and remote general grocery stores.

#3 Sales people were told to inform their customers that they need to plan and be ready to deal with rapid and un-expected price increases on food products, this is going to become a way of life.

Please pass this on to your readers. – Buckskin in Texas