As the Market Basket labor controversy enters its seventh day, the ripple effects of the paralysis caused by the employee protest are beginning to hurt the small food suppliers who count the grocery chain among their biggest buyers.
Dorothea and George Barker run a farm in North Andover where they are waiting to harvest several tons of corn for five nearby Market Basket stores that they regularly supply. The couple, in their 80s, sell almost $60,000 worth of corn to the chain a year, but they can’t get their urgent calls to the Market Basket stores returned.
“We have beautiful corn in the fields, and we’re wondering what we’re going to do with it,” said Dorothea, 84. “I just wish those two cousins could get it sorted out.”
Those two cousins are Arthur T. Demoulas and Arthur S. Demoulas, whose bitter dispute for control of the Market Basket empire has prompted a remarkable protest from employees. Deliveries have ground to a halt, and shelves of produce, meat, and seafood in many stores are empty while employees picket outside encouraging loyal customers to boycott the chain and do their shopping at competitors.
At Pleasant Valley Gardens farm in Methuen, Rich Bonanno said he has lost $1,500 selling vegetables at lower prices to buyers for other stores instead of directly to Market Basket. A supplier to Market Basket for more than 30 years, Bonanno has $200,000 invested in a crop of mums that he expects to deliver to Market Basket in a few weeks.
“If it’s a week, I’ll survive. If it’s a month, if we don’t ship those mums, we won’t be in business next year,” Bonanno said. “I have no idea what’s going to happen.”
Market Basket employees involved in the protest said the company’s warehouse in Andover typically ships more than 700 truckloads of produce and other perishable goods every week to the chain’s 71 stores throughout New England. But with warehouse workers refusing to go to work, few trucks are getting new goods to the stores. Workers at the Andover warehouse said hundreds of thousands of dollars of spoiled seafood was thrown away over the weekend.
Seafood vendors are facing the loss of thousands of dollars in business as the standoff continues. In an average week, the company would buy about $6 million worth of seafood, said Bob Hartman, a buyer for Market Basket.
Employees at two seafood vendors said if the controversy continued for much longer, they might have to resort to layoffs. They asked not to be identified out of fear of losing Market Basket contracts.
One seafood vendor said Market Basket spreads its buying among many companies.
“They buy a little bit of fish from a lot of people,” said Bob Brandano, the president of Great Eastern Seafood. “It’s something that we’re hoping will get squared away.”
A spokesperson for executives of the parent company, Demoulas Super Markets Inc., declined to comment.
With $4-plus billion in annual revenues, the customer boycott and emptying shelves have probably cost Market Basket tens of millions of dollars in lost revenue, said industry observer Kevin Griffin, publisher of The Griffin Report on Food Marketing. But the damage to the chain’s reputation, he added, could be much larger.
“Every day this goes by, the potential for damage to the long-term health of the company exponentially gets worse,” Griffin said.
Meanwhile, the protesting employees said they are planning another rally on behalf of Arthur T. Demoulas, again at the company’s headquarters in Tewksbury on Friday at 9 a.m. On a Facebook page used by organizers, the gathering was referred to as the“final rally” to convince the company’s directors to reinstate Arthur T. as the company’s chief.