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LOS ANGELES MARKET PROFILE
(L to R) Ray Vargas, Raul Ramirez Jr., Don Presant of Morita Produce
“Years ago, 60 percent
of the restaurants in the state were full service and 40 percent were limited. When you look at it to- day, the opposite is true. We think that it is large- ly because of the cost of operating a full-service restaurant, the labor plus the other costs.”
— Sharokina Shams,
California Restaurant Association
dent supermarkets that compete for the same ethnic customers.”
Although consolidation has limited produce wholesaler options, the emergence of new distributors also has narrowed margins.
“Lately, it has been very competitive with new distributors,” says Lopez. “We have to sell more product at lower prices.”
In Los Angeles, as elsewhere, the trend is toward segmentation of produce retailers that is parallel to the economic segmentation of the society.
Kroger is the largest retailer in the metro- politan area with more than 22-percent market share, according to the most recent Chain Store Guide’s 2017 Grocery Market Share report, and Safeway still has more than a 10-percent share.
But both of these mainstream chains that serve middle-class customers have lost some market share in the past two years, while Dollar Stores, Walmart, and Target have seen their shares increase, and Whole Foods, Trader Joe’s, and Sprouts, serving upscale customers, also have increased.
Markets serving predominantly Hispanic customers are increasing in Los Angeles as in few other places, with Numero Uno, Vallarta and Cardenas markets all having a strong presence.
Economics are also reshaping the restau- rant sector throughout California, including the Los Angeles metro area.
“More and more in California when new restaurants open, the operators are more likely to open a fast-casual or quick-service estab-
(L to R) Marco Pantaja, Jose Abila, Fernando Pantoja of Rainforest Produce
(L to R) Abel Gutierrez, Gabriel Barba, Chris Martin, Tony Guitierrez, Jake Brady of VIP Marketing
Fresh LLC. “Los Angeles is a very compet- itive market and a place where you can get top-quality product in addition to the excess volumes from the nearby growing Central Valley. We service mostly west of the Rocky Mountains. Our portfolio includes retailers, wholesalers, foodservice and cash customers.”
Clark nds there is more retail competi-
tion, even when it comes to produce items that were considered specialty not that long ago.
“In comparison to 10 years ago, there are many more items being o ered, and these are being o ered directly from the source,” he says. “ ere is always an overlap of ethnic markets. We service a number of indepen-
162/ OCTOBER 2018 / PRODUCE BUSINESS