UNFI re-ups primary distribution pact with Whole Foods

United Natural Foods Inc. (UNFI) has extended its primary wholesale grocery agreement with Whole Foods Market, its largest single customer.

UNFI said Thursday that, with the extension, the term of the companies’ distribution pact now runs until Sept. 27, 2027. The contract previously was slated to expire on Sept. 28, 2025.

“Since the onset of the COVID-19 pandemic, UNFI and Whole Foods have worked closely together to consistently deliver ‘better for you’ foods to consumers throughout North America. This extension allows both companies to maintain focus on what is most important: continuing to meet the growing demand for healthy food at home as we navigate through the global pandemic,” UNFI Chairman and CEO Steven Spinner said in a statement. “We look forward to continuing to play a very important role in the rapidly evolving ‘foodscape’ and supply chain, while furthering our tradition of innovation, scale and efficiency.” 

A subsidiary of e-tail giant Amazon, specialty grocer Whole Foods accounted for about 18% of UNFI’s net sales for its 2020 fiscal year ended Aug. 1 and is the only customer that represented more than 10% of the distributor’s net sales.

UNFI’s net sales with Austin, Texas-based Whole Foods — the only customer in the distributor’s “supernatural” channel — rose 7.4% to $4.72 billion in fiscal 2020 and climbed 9.3% to $1.21 billion for the fiscal 2021 first quarter ended Oct. 31. 

Related:UNFI to see growth with unique mix of brands, services, says CEO Steve Spinner

Overall, Whole Foods now operates 502 stores in the United States, 14 in Canada and seven in the United Kingdom. UNFI also supplies some of Amazon’s food stores.

“UNFI plays a key role in ensuring Whole Foods Market is able to meet the growing demand for high quality products across our network of stores and facilities,” stated Bart Beilman, senior vice president of supply chain and retail operations at Whole Foods. “We’re pleased to continue our strong and longstanding partnership with UNFI.” 

Providence, R.I.-based UNFI is the nation’s largest publicly traded grocery wholesaler, supplying about 30,000 locations for natural product superstores, independent retailers, conventional supermarket chains, e-commerce retailers and foodservice providers from 55 distribution centers and warehouses.

Other UNFI retail customers, according to the company’s 2020 annual report, include The Fresh Market, Coborn’s, Natural Grocers, Jerry’s Foods, Vitamin Cottage, All American Quality Foods, Festival Foods, Ahold Delhaize USA (Stop & Shop, Giant Food, The Giant Company and Hannaford), Lunds & Byerlys, Superior Grocers, Vallarta Supermarkets, Wegmans, Raley’s, Redner’s Markets, Neiman’s Family Market, Dierberg’s, El Super Supermarkets, Sprouts Farmers Market, Kroger, Harris Teeter, Giant Eagle, Market Basket, Schnuck Markets, ShopRite, Publix, Raley’s and Loblaw.

Related:UNFI ramps up business with new, existing customers in Q1

In October, UNFI entered a primary grocery distribution agreement with Matawan, N.J.-based with Key Food Stores Co-Operative Inc. that will bring an estimated $10 billion in sales over 10 years.