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Buyer of Supervalu is a key player in fast-growing organic foods industry

July 26, 2018 GMT

The company buying Supervalu Inc. may not be a household name but is a key player in the fast-growing natural and organic foods market.

United Natural Foods Inc., based in Rhode Island, has been the primary wholesale supplier to Whole Foods Market for nearly 20 years. It is the largest distributor of natural and organic products in U.S. and Canada and supplies 43,000 stores, according to federal filings. The Supervalu acquisition marks its biggest step into the distribution of conventional foods.

Whole Foods, now a unit of Amazon.com Inc., accounts for more than one-third of United Natural Foods’ revenue. Its other customers include grocery store chains Natural Grocers, Wegmans, Kroger, Sprouts Farmers Market, Lucky’s, Publix and Loblaws.

Its largest competitor is Illinois-based KeHE Distributors, which owns Tree of Life, a distributor that started consolidating the U.S. natural and organic foods supply chain in the 1990s.

UNFI was the first food distributor in the nation designated a “certified organic distributor” by Quality Assurance International, an agency accredited by U.S. Department of Agriculture.

Today, it owns and operates 33 distribution centers, including one in Prescott, Wis., that serves the Twin Cities region. The company owns about 8.7 million square feet in warehouse storage across North America.

Since 2007, the company’s net sales have grown at a 12.9 percent compounded annual rate, according to company filings. Acquisitions have played a key role in its growth. Since 2000, UNFI has bought 19 distributors, manufacturers and suppliers.

The company breaks down its business into three divisions: wholesale, retail and manufacturing/branded products. Its retail division is small, composed of just 12 retail stores, primarily located in Florida, which were acquired through the purchase of Earth Origins.

Its private-label products include Woodstock Farms, Blue Marble, Field Day, Harvest Bay, Asian Gourmet, Tumaro’s and Rising Moon.

Kristen Leigh Painter • 612-673-4767