“We became interested in Topco, knowing that they provide services and marketing support for private brands as well as other value-added programs within their portfolio, about mid-summer last year,” Ken Nemeth, president and CEO of Central Grocers, tells The Shelby Report. “We did an orientation of their program, they presented their plans to our group, and we’ve taken the next step to become a member of Topco.”
Nemeth notes that Topco will provide services to Central Grocers, including procuring its private brand, which will remain Centrella, as it has for 99 years.
“They will take over procuring those items for us,” he says. “They will also allow us to use other parts of their program, including Certified Angus Beef, which they are the nation’s largest buyer of Certified Angus Beef. We buy Certified Angus as well. So if we can save a penny or two or three a pound, that’s wonderful for our members.
“We’re looking at their produce programs with the same thought in mind. They have value-added programs that they go out and bid. For instance, shrink wrap that we all use in our warehouses. They take economies of scale from all the members that they do business with and go out and bid the lowest possible price across the country. We’ll be able to take advantage of that as well as fuel for the fleet that we use and many, many others—refrigeration, store engineering, trucks and trailers, on and on and on.”
Nemeth estimates that Topco supports more than 15 different wholesalers across the country with the same types of programs.
“It’s a partnership with an organization that lends economies of scale and marketing support to enable Central Grocers to be better positioned in the Chicago market here,” he adds.
When asked if the fact that many ROFDA members are Topco members influenced him, Nemeth says that he found great support from the group’s membership. (Central Grocers is a member of Retailer Owned Food Distributors & Associates.)
“I had a lot of support from the ROFDA membership. A lot of the CEOs called and told me what a great program it was and welcomed me into the Topco program. There is a camaraderie there, I think, that is beneficial for us as well.”
Topco President and CEO Randy Skoda says, “I am excited for this strong retailer-owned wholesaler to join our membership. We look forward to partnering together to help Central Grocers fulfill their mission of serving the true independent grocer in their local market.”
Central Grocers supplies grocers such as Strack & Van Til, Tony’s Finer Foods, Ultra Foods and Sunset Foods, and will participate in Topco’s grocery, dairy/bakery, meat, deli, produce and floral programs. Elk Grove Village, Illinois-based Topco expects to have the wholesaler fully transitioned by the first quarter of 2017.
In a press release, Nemeth says, “Central Grocers is pleased to join the Topco family. Topco’s innovative approach to finding business solutions in the grocery industry will be of significant benefit to the members we serve in more than 500 independent grocery stores. We envision that their buying power will help us maintain customer-friendly pricing in our intensely competitive markets, while Topco’s expertise in quality assurance, packaging and sustainability will help us improve overall in-store efficiency.”
Formed in 1917, Central Grocers has grown to become a $2 billion, member-owned grocery wholesale cooperative. The wholesaler supplies more than 500 independent retailers in the Chicagoland and Northwest Indiana area with groceries, produce, fresh meat, service deli items, frozen foods, ice cream and is the exclusive distributor of the Centrella Brand.