Houston, Tex.-based Sysco Corporation (SYY) and US Foods Holding Corp. (USFD) in Rosemont, Ill., are two prominent players in the food industry. SYY markets and distributes a range of food and related products primarily to restaurants, healthcare, and educational facilities. The company also distributes personal care guest amenities, housekeeping supplies, room accessories, and textiles to the lodging industry. In comparison, USFD markets and distributes fresh, frozen, and dry food and non-food products to independently owned single- and multi-unit restaurants, regional concepts, national restaurant chains, hospitals, nursing homes, hotels and motels, country clubs, government and military organizations, colleges and universities, and retail locations.
Deepening of supply chain disruptions, rising oil and commodity prices, and labor shortages have led to a significant increase in food prices lately. However, a steady demand for fresh and packaged food products should allow food distribution companies to benefit by passing on their increased input costs to their customers. Also, the adoption of software and the latest technologies in warehousing and distribution should drive the industry’s growth. So, both USFD and SYY should benefit.
