Here’s what the grocery list to restock an empty supermarket chain looks like: 300 tons of steak, rump roasts, and other beef; 60,000 cases of hot dogs, bacon, and deli products; 120 tractor-trailer loads of produce; and 15,000 boxes of fish fillets and seafood.
With barely any fresh food in its 71 stores, Market Basket faces an epic shopping spree to bring the chain back to normal when — or if — the employee protest and customer boycott over the dismissal of Arthur T. Demoulas ends. The process will probably take weeks and require several thousand truckloads of food shipped in from the company’s two main warehouses and from outside suppliers.
“It will be a monumental task,” said Andy Lien, former director of the chain's perishable warehouse in Andover. “It is basically having 71 new stores open for the first time on the same day.”
Market Basket’s current management declined to comment on the restocking effort facing the company. The estimates were provided by current and former employees who were involved in purchasing and supplying the stores.
Analysts say the attention the Demoulas debacle has attracted may further complicate the situation when the company attempts to return to normal. In addition to thousands of loyal Market Basket customers returning to stores, the chain may be bombarded with curious new patrons and not have nearly enough food to meet the rush.
Lien estimated it would take three days just to begin the process of getting food to the stores: one to inventory the warehouses and throw out spoiled goods, a second to start shipments into the warehouses, and the third to begin sending the first supplies into stores.
By the end of the first week, Lien said, most stores should be reasonably well stocked. But some sections will take much longer. Cuts of beef, for example, are not just sitting on the shelves of food wholesalers. Instead cattle are slaughtered for each order on ranches in Iowa and Nebraska, Lien said, meaning it could take several weeks for the beef to be processed and delivered to stores. The company may be able to buy meat from local ranches, but it would be far short of the quantities stores typically carry.
The Market Basket chain has been paralyzed by a bitter family feud, in which employees have sided with Arthur T. Demoulas, who was ousted as company president in June by his rival and cousin, Arthur S. Demoulas.
Most stores have been without seafood, meats, produce, and other supplies since Market Basket warehouse employees walked off the job and prevented new deliveries from getting through. Analysts have said the chain has been losing millions of dollars a day in sales, while the two factions of the Demoulas family negotiate an offer from Arthur T. Demoulas to purchase his cousin’s share of the company.
The new chief executives replaced some of the warehouse staff, but the facilities are mostly idle and only a few deliveries have made it to stores. The company has threatened to replace any employees who do not report back to work on Monday.
The crisis has also probably hurt Market Basket’s business relationship with some of its suppliers, who, left in the lurch, have sold their products to other supermarkets and food buyers.
For example, George Barker, the owner of Barker Farm in North Andover, sells about $60,000 worth of corn a year to Market Basket and had a crop ready to pick when the chain seized up. With those stores unable to buy his corn, Barker said he finally struck a deal to sell much of the harvest to the Whole Foods chain — at a slightly higher price than what Market Basket had paid — and would not be in a position to take new orders from his old customer.
“I have other commitments now, so I wouldn’t be able to do that,” Barker said. “Before Whole Foods contacted me, I was in deep trouble.”
Patrick C. Fitzpatrick, president of Atlanta Retail Consulting, said Market Basket may run into similar problems with other vendors, especially if it needs to buy larger-than-normal quantities because its shelves are so empty. Fitzpatrick, whose company provides strategic and operational consulting for retailers and grocery chains, said farmers often sign contracts that strictly allocate their crops among different vendors.
“They can’t just all of a sudden triple what they are ordering, in most cases,” he said.
The financial damage inflicted on the company by the two-week action may also weigh on its ability to restock. Without the cash coming in from ongoing sales, Fitzpatrick said there is even less money available to finance the huge shopping bill that comes with restocking on such a scale. There are also myriad logistical challenges. Supermarket stores and warehouses are typically designed to receive a certain amount of products at any one time, so a flood of deliveries could create a traffic jam at the loading docks.
Each store only has a few locations for delivery trucks and the unloading process may be further slowed if outside vendors and warehouse drivers show up at the same time, Fitzpatrick said.
Brian Rockwell, the manager of the Market Basket in Danvers, said he needs at least 15,000 cases of dry groceries, 7,000 cases of dairy goods, 1,200 cases of beef, chicken, and other meats, 600 cases of deli items, 4,000 cases of produce, and 400 cases of baked goods to fully restock his 80,000-square-foot store.
And all of it will have to move through just three loading bays at his store. Rockwell said it takes several hours to unload one truck and move the products to shelves.
Fitzpatrick said Market Basket customers will have to be patient as operations return to normal, especially if there is a surge of new patrons adding to the crush while employees scramble to fill shelves.
“The supply chain is complicated enough when it’s running smoothly,” Fitzpatrick said. “We are talking about a very big disruption in a very complex supply chain. There will be a recovery period for quite awhile.”