Sysco Just Bought Restaurant Depot

Here’s What That Could Mean

For many independent restaurants in Rockland and across the country, Restaurant Depot has been a staple due to their ability to provide quality, affordable food to hungry customers. Operated by Jetro holdings, Restaurant Depot is a cash and carry service providing restaurants with whole-sale affordable food and other supplies. The company has long been seen as a counter-balance to the monopolistic food distributors who dominate American food service. This independence is under threat, with Sysco entering into a deal with Jetro Holding to acquire Restaurant Depot for $29 billion. 

Sysco is the world’s largest broadline food distributor with over 300 locations spread across ten countries. The company sells everything from utensils and napkins to pre-prepared frozen food. Restaurant Depot has noted as a way to curb the monopolistic tendencies of companies like Sysco and USFood due to their cash and carry model and their wholesale prices. No delivery fees, or “white glove service,” instead allowing restaurant owners to get the food they need at lower prices than the alternative. Restaurant owners have also been able to push distributors like Sysco to price match their food with what Restaurant Depot offers, providing the industry with healthy competition to keep the larger food distributors in check. 

The acquisition on the horizon threatens to undo this system. USFoods, Sysco’s largest competitor, bought out another cash and carry restaurant supplier, Smart Foodservice, in 2020. They rebranded to ChefStore in 2021, expanding the service from 80 to 95 stores nation-wide. Independent Cash and Carry services like Restaurant Depot provide needed equilibrium to an industry that has been struggling since the Pandemic. If this deal goes through, we could see prices on restaurant supplies rise drastically, food quality decrease, and the further monopolization of an already rapidly monopolizing industry. 

Restaurant Depot operates locations in both Nanuet and Blauvelt, New York with many independent restaurants in the area relying on the service to provide affordable quality food and other restaurant supplies. Should this deal go through, restaurant owners could become further squeezed for cash in an already expensive industry. Increased prices for supplies means a higher bill the next time you go out to eat. Independent Restaurant owners have been organizing and have called on the FTC to block the acquisition. Stock in Sysco has also declined due to investors understanding the debt Sysco would have to acquire to pay the $29 billion bill. No one in the restaurant industry seems excited about this and a feeling of dread is looming over the deal for everyone who isn’t an executive at Sysco or Restaurant Depot. Only time will tell what the future of restauranteering will look like, but it’s safe to say that it is sure to be quite contentious.