- Enhances competitive advantage through greater selection of nationally branded, dry goods and grocery products at materially lower wholesale costs
- Increased, post-COVID grocery demand enabled minimum order size required for approval by UNFI
The agreement provides SDFO new access to a broad range of nationally branded products that can better meet the specific needs of its unique customer demographic and increase SDFO sales.
The Company also expects SDFO margins on dry goods and grocery items to materially improve due to the lower costs allowed by access to top tier distribution and national scale sourcing by UNFI.
Because SDFO minimum order size in years prior was not sufficient for account approval by a tier 1 distributor, it had to rely on regional distributors with limited selection of national brands, at higher prices.
With the consolidation of these items into a national, tier 1 supplier, SDFO’s customers gain a vastly improved product selection at lower prices, a critical competitive enhancement that improves new account growth, customer retention, and average revenue per customer.
Its regional supply relationships will be reoriented toward specialty brands more effectively supplied by such suppliers.
The UNFI relationship allows optimization of SDFO’s product mix to better respond to the unique characteristics of its regional customers and changing consumer behavior driven by COVID.
"Broader, more nimble product choice removes friction in winning new accounts and expanding existing ones," commented
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