UNFI to Take Over as Key Food Wholesaler

United Natural Foods Inc. is taking over as the primary grocery wholesaler for the Key Food Stores Cooperative, winning an estimated $1 billion annual account in metro New York from rival C&S Wholesale Grocers.

Key Food, based in Matewan, N.J., is a cooperative of 315 independently owned supermarkets in the Northeast and in Florida, doing business under multiple banners, including Key Food, The Food Emporium, Food Universe, Food Dynasty, SuperFresh and Gala Foods. It is especially strong in New York’s five boroughs, where its independent owners operate hundreds of neighborhood grocery stores.

Providence, R.I.-based UNFI said it would supply Key Food stores with conventional, natural and organic grocery products, along with a variety of international items. Categories such as protein, produce, frozen bakery, deli, general merchandise and health and beauty, as well as Key Food’s Urban Meadow private brand and UNFI-owned brands such as Essential Everyday and Woodstock, will also be supplied.

Key Food has annual sales of about $3 billion. UNFI said it expects it supply agreement with the cooperative to produce wholesale sales of $10 billion over the 10-year agreement.

UNFI said it has already begun serving certain Florida stores and would expand service to Key Food’s stores in the Northeast by the end of next year. The wholesaler said it anticipated servicing the Northeast stores from a new distribution facility currently under construction in Lehigh County, Pa. The 1.3 million-square-foot facility, which will serve Key Food and other Northeast clients including Key Food rivals like the Allegiance Food cooperative, is expected to open in fall 2021.

“We are excited about our relationship with UNFI,” Dean Janeway, CEO of Key Food, said in a release. “Their unique ability to service the entire store on a single delivery in addition to their industry expertise and buying power gives Key Food members an advantage in the marketplace. We are thrilled to partner with the UNFI team, and our members look forward to offering UNFI’s full line of products to their shoppers.”

“Key Food ... is a rapidly growing organization with a large market share in the New York market,” said UNFI Chairman and CEO Steven Spinner. “We have recently begun to service their Florida stores and are excited to expand service to their Northeast stores toward the end of 2021. We believe our unmatched product variety and knowledge of today’s consumer will benefit Key Food and its retailers, and we look forward to driving value to their operations.”