Rising to the Challenge

The nation’s top c-store wholesalers are helping retailers overcome today’s obstacles

By Linda Lisanti

JUST LIKE THE RETAILERS they serve, the nation’s convenience channel wholesalers are feeling the effects of the ongoing labor shortage, including a short supply of qualified truck drivers, as well as having to overcome the impacts of national economic issues and inflation.

Despite these major challenges, the largest wholesalers serving the U.S. convenience store industry are rolling out new and improved services to keep pace with the increasing demands of the channel’s retailers — as they try to keep pace with the increasing demands of customers.

According to the findings of the 2022 Convenience Store News Top Wholesalers Report survey, supply chain issues driven by the ongoing labor shortage continue to plague the industry. When asked what new services or business solutions they’ve added in the past year to help their clients, respondents indicated that they’ve introduced new online and mobile ordering solutions, new in-store inventory solutions, and product replacement programs for items in short supply.

Some wholesalers did report that they’ve had to rationalize SKUs due to supply chain issues. However, at the same time, they are branching out into new categories such as better-for-you products, specialty items and product lines previously sold through DSD distribution.

Tobacco continues to be the largest revenue-generating category for the convenience channel’s top wholesalers. According to this year’s survey conducted by CSNews, cigarettes account for 69.3 percent of total sales, while other tobacco products represent 12 percent. Foodservice is a growing part of the business, representing more than 5 percent of sales. This is not surprising given the sheer number of c-store retailers that have introduced new prototype stores over the past year that put fresh food front and center.

Convenience channel wholesalers are rolling out new and improved services, and branching out into new product categories.

Top Wholesalers Summary

TOTAL SALES (Percent change vs. year ago):

Top 15 wholesalers $89.0 billion (+25.5%) Top 5 wholesalers $81.2 billion (+27.8%)

AVERAGE SALES PER:

Company Warehouse

$5,268 billion $422 million

Percent of Sales by Category

Cigarettes

69.3%

Other tobacco products 12.0% Foodservice 5.1% Candy 4.7% Salty snacks 2.9% Grocery 2.5% All other* 3.5%

*All other includes general merchandise, health & beauty care, fresh produce, CBD products, gourmet/natural/specialty food, and other.

Rank Company/Headquarters Latest FY1 (millions) Previous FY (millions)

% change Trading Area Locations Served Deliveries per Week

1 McLane Co. Inc., Temple, Texas 2 $49,450 $46,840 5.6% 50 states

2 Performance Food Group, Richmond, Va. 3

$20,603 $5,947 246.4%

3 H.T. Hackney Co., Knoxville, Tenn. $5,500 $5,500 0.0%

AR, AZ, CA, CO, FL, GA, IA, IL, IN, KY, MA, ME, MI, NC, NV, OH, OR, PA, TX, UT, WI, WA

AL, AR, FL, GA, IA, IN, KY, LA, MD, MI, MO, MS, NC, OH, PA, SC, TN, TX, VA, WV

Imperial Super Regional Distributor/S. Abraham & Sons Inc., Elmwood, La. 4

$2,828 $2,400 17.8%

AL, AR, GA, IL, IN, KS, KY, LA, MI, MO, MS, NC, NE, OH, OK, PA, SC, TN, TX, WI, WV

5 National Convenience Distributors, Farmingdale, N.Y. 5 $2,787 $2,806 -0.7% CT, DC, DE, MA, MD, ME, NH, NJ, NY, PA, RI, VA, VT

6 AMCON Distributing Co., Omaha, Neb. 6

7 GSC Enterprises Inc., Sulphur Springs, Texas

8 Southco Distributing Co., Goldsboro, N.C. 9 Cooper-Booth Wholesale Co., Mountville, Pa. 10 Chambers & Owen Inc., Janesville, Wis. 11 Harbor Wholesale Foods, Lacey, Wash. 12 Capitol Distributing, Caldwell, Idaho 7

13 Topicz, Cincinnati 8

$2,353 $2,310 1.9%

$973 $973 0.0%

AR, CO, DE, FL, GA, IA, ID, IL, IN, KS, KY, MD, MN, MO, MT, NC, ND, NE, NM, OH, OK, PA, SD, TN, TX, UT, VA, WV, WY

AL, AR, FL, GA, KS, LA, MO, MS, NE, NM, OK, TX

$889 $822 8.2% GA, NC, SC, TN, VA

$860 $740 16.2% DE, MD, NJ, PA, VA, WV

$605 $600 0.8% IA, IL, MI, MN, WI

$575 $575 0.0% AK, CA, ID, OR, WA

$452 $363 24.3% AZ, CA, ID, NV, OR, UT, WA

$450 $438 2.7% IN, KY, OH, WV

14 Tripifoods Inc., Buffalo, N.Y. $345 $332 3.9% IN, NY, OH, PA, WV

15 Resnick Distributors, New Brunswick, N.J. 9

$311 $267 15.6% NJ, NY, PA

n/a n/a

50,000 n/a

n/a n/a

5,500 6,000

9,487 12,467

5,400 5,100

n/a n/a

1,300 1,700

1,200 1,800

1,100 1,300

n/a n/a

n/a n/a

1,000 1,200 1,350 900 900 900

Footnotes:

1 FY = Fiscal year 2 These results are from the latest 10-K of Berkshire Hathaway (McLane's corporate parent). Sales include convenience, grocery and foodservice operations. McLane declined to participate in this year's report. 3 These results are from the latest 10-K of Performance Food Group, which completed the acquisition of Core-Mark in September 2021. The increase in sales was driven primarily by this acquisition. 4 Imperial Trading Co. is the parent company of Imperial Super Regional Distributor/S Abraham & Sons Inc. 5 Century Distributors of Rockville, Md., was acquired by National Convenience Distributors. 6 In May 2022, AMCON Distributing Co. acquired majority control of Team Sledd LLC. The financial results included here reflect the pro-forma combination of the companies. 7 TCD Distributing of Boise, Idaho, was acquired by Capitol Distributing. 8 Novelart Manufacturing Co. is the parent company of Topicz. 9 Plainfield Tobacco and Candy Co. is the parent company of Resnick Distributors.

To meet the need, the channel’s top wholesalers are expanding their foodservice offerings. When asked what kinds of offerings were added in the past year, respondents cited proprietary fried chicken programs, proprietary pizza programs, proprietary fresh sandwich programs, more finger-food offerings, and more protein and bread offerings for build-your-own sandwich programs.

A focus on proprietary items is being seen in other product categories as well. Along with foodservice, respondents who said they’ve expanded their private label business in the past year cited peg candy, snacks and baked goods as other areas of private label development.

Another burgeoning area of innovation among c-store industry wholesalers is technology tools and solutions to better support their clients. Reflecting on the past year, respondents said they’ve enhanced their offerings by upgrading mobile apps and websites, introducing new ordering technologies and planogram management tools, updating software, improving manufacturer rebate tracking and developing custom apps to improve customers’ operations. On the drawing board for 2023 are digital signage offerings and custom marketing opportunities.

The 15 largest wholesalers serving the U.S. convenience store industry generated combined sales of $89 billion this year, with sales per company averaging roughly $5.3 billion.

Making Headlines

The 15 largest wholesalers serving the U.S. convenience store industry generated combined sales of $89 billion this year, with sales per company averaging roughly $5.3 billion.

Several of the convenience channel’s top wholesalers made headlines in 2022:

• Performance Food Group (PFG) announced the alignment of its convenience business under the

Core-Mark brand. The decision came one year after

PFG completed its acquisition of Core-Mark Holding

Co. Inc., which followed its purchase of Eby-Brown

Co. LLC in 2019. The newly combined Core-Mark now services more than 50,000 customers through 39 distribution centers across the United States and Canada.

• McLane Co. Inc., the c-store industry’s largest wholesaler, unveiled updates to its Mobile Virtual

Trade Show (VTS) ordering app. The changes include an improved user experience and enhanced ordering capabilities that make multistore ordering easier. Launched in 2018, Mobile VTS lets retailers scroll through products and review detailed listings; provides easy-to-order summaries; and adds new items that are part of the best deals offered to the retail community on a weekly basis.

• S. Abraham & Sons Inc. (SAS) hosted its 36th

Annual Vendor Exhibit & Trade Show in a hybrid format this year to accommodate both in-person and online ordering. Retailers had a six-week buying opportunity, running from Jan. 24 to

March 6, to place orders on its portal. During the hybrid show, SAS showcased new and innovative opportunities for c-store retailers, including several plant-based frozen and shelf stable grocery selections for consumers looking to take up a vegan, vegetarian or flexitarian lifestyle and consume fewer meat products.

• Harbor Wholesale Foods acquired the brand and intellectual property of Skippers Seafood &

Chowder from Starway Restaurants LLC. In assuming the rights to the 52-year-old brand, Harbor will support Skippers’ five remaining retail locations, online retail business and 128 quick-serve restaurants found in convenience and grocery stores throughout the Northwest. CSN

METHODOLOGY

Rankings for the Convenience Store News Top Wholesalers Report are based on sales for the last full fiscal year for each company. Data for this report was gathered through a survey conducted among the largest wholesalers primarily servicing c-stores that derive the majority of their sales from tobacco and candy products. Additional data was obtained through company reports and other public sources of financial data. In some cases, estimates have been made by CSNews based on historical data and current industry trends.