If you enjoyed dinner in a restaurant last night, you contributed to the sales of the foodservice industry. If your child had a school lunch, your grandmother had breakfast in a nursing home, your spouse had coffee in the company cafeteria, your cousin ate supper in a military mess hall, or your uncle—unfortunately—had lunch in prison, they were being served by some segment of the foodservice industry.

Foodservice, by definition, is the industry that serves any food that is not prepared in the home. As one of the largest private sector employers in the U.S., it represents more than $560 billion in estimated 2009 sales and employs more than 13 million  (Source National Restaurant Association). A complex supply chain helps make this industry successful, including a distribution network that supplies a broad range of products and services that help the food away from home industry thrive.

When U.S. consumers sit down to eat in one of the nation’s nearly one million foodservice locations, the food on the plate—and possibly the plate and tableware—has been brought there by a foodservice distributor. The menu you read in a restaurant may well have been printed by a foodservice distributor and a consultant chef at a foodservice distributor may have helped shape a restaurant’s menu items. In the wide array of choices for food away from home, consumers can easily name a dozen restaurants from fast food chains to their favorite Italian restaurant — yet few could name a foodservice distributor.

This largely behind the scenes industry includes more than 2,500 companies operating thousands of warehouses and massive transportation fleets. Every day, foodservice distributors make sure that products are delivered safely to foodservice operators — from fresh fish, meats, and produce to dry goods and refrigerated and frozen products. A typical broadline foodservice distributor may serve anywhere from 1,000 to 6,000 accounts from a single distribution center and offer their customers more than 10,000 items to meet specific operator needs. In 2008, estimated distributor annual sales in North America exceeded $240 billion.

The evolution of the foodservice distribution industry is directly linked to the growth of the restaurant industry. Following World War II, a typical food distributor served any market need — from a small local grocery store to hotels. By 1955, as restaurants proliferated and consumers more frequently ate out, foodservice distribution began emerging as a separate industry from retail grocery distribution. At that time, only 25 percent of an average family’s food dollar was spent on “food away from home.” By 2008, that share grew to 48 percent.

A Brief Tour of the Foodservice Distribution Industry:
From Groceries to a Specialized Industry (1850s to 1940)
In 1878, Ulysses S. Grant had just left the office of the presidency, Alexander Graham Bell had just invented the telephone, Thomas Edison was about to unveil the incandescent light bulb, and the C.A. Curtze Company was delivering food and other merchandise (such as gunpowder) to retailers and oil and lumber camps in Pennsylvania. In 2007, the C.A. Curtze Company had revenues of $274 million and is run by the fifth generation of the founders.

In 1901, CONCO Food Service made deliveries to customers in stern paddle wheelers on the Mississippi and along the bayous of Louisiana. The Kurzweg family, who started the company, reported revenues of $391 million in 2007.

And in 1906 a man named Ben E. Keith helped start a potato and onion distributor in Fort Worth, Texas, that delivered its goods by horse and buggy. Today Ben E. Keith Foods serves 29,000 accounts from six divisions, delivering to ten states, and with revenues of nearly $1.7 billion annually.

Founded by entrepreneurs who first plied their trade from garages or small stores as far back as the mid-1800s, that pioneering spirit still exists in the third, fourth, and even fifth generation family-owned businesses that make up a large portion of the foodservice distribution industry.

Hundreds of companies started by selling a few items in a category such as dairy or poultry. As consumers became more mobile, inns and boarding houses popped up to serve hungry travelers. Food distributors expanded their product lines to fill the needs of a growing industry. New technologies and ingenuity brought about inventions such as frozen foods and multi-temp trailers that radically changed what was available to consumers. The great American restaurant industry expanded, ranging from roadside diners along the highway to sophisticated eateries like Delmonico’s in New York. From the small family restaurant to the largest urban hotel, they all needed someone to deliver food and other supplies to their back doors.

America on the Move: Institutional Distribution Grows Up (1940 to 1970)
One of the growth drivers in foodservice was supplying institutional facilities like schools or hospitals and because of that, the distribution role within foodservice came to be known as “institutional distribution.”

The National School Lunch Act was passed in 1946. According to a history published by trade publication ID magazine, this was the single event that gave shape to the industry by providing a mass market for “institutional” products. Many companies that were serving both retail grocers and restaurants and institutions now began focusing on the latter.

Through the 1950s and 1960s, the industry continued to expand. A trade group, the International Foodservice Distributors Association, was formed* to address the needs within this growing supply channel. Distributor purchasing groups were formed and non-food products such as equipment and supplies were added to distributors’ product lines. The fast-food industry was born and Americans were spending more and more of their food dollar away from home.

Foodservice Distribution Becomes Sophisticated (1970 to Present)
In 1970, ten independent distributors joined together to form Sysco Corporation and the industry was changed forever. The goal was to create a company that had a broad geographical scope and the new company instantly became the largest distributor in sales volume with sales of $415 million. Sysco, the only publicly traded foodservice distributor, remains the largest industry company to this day with $37.5 billion in 2008 sales. In a competitive landscape, all foodservice distributors had to raise the bar in meeting customer needs with increased efficiency.

As distribution grew through the 1980s, warehouse efficiency became a key element in competitive success. In the 1990s, added focus came to other areas of the business, including sales and marketing and significant investments in technologies. Along with being an important conduit for new product information, distributors created a number of value-added services for operator customers from menu planning and food-safety programs to trend and market information and business analysis. Foodservice Distributors have become, in many cases, a true partner to their customers in helping them meet consumer needs and in staying profitable.

The foodservice industry touches the lives of every consumer and foodservice distributors are critical partners in making  “food away from home” possible. Whether you’re a student at an elementary school or a grandmother in a retirement community, whether you’re with your family enjoying pasta at a “Mom & Pop” Italian restaurant or with a business group enjoying Black Angus beef at a steakhouse chain, the meal you ate away from home was made possible, in part, by a foodservice distributor.