July 14, 2015

Kosher Food Industry Reaction Mixed to Mergers in Food Industry

New York - The recent failed merger between Sysco and US Food Service due to the opposition of the US government was greeted with mixed reviews by kosher food industry sources. Some of the larger manufacturers who deal with both were not too unhappy with the failure largely out of a belief that the competition between the two food giants is good for business. This, despite the contention of the companies that it would improve efficiency and even improve the chances of doing more business with a larger entity. There is somewhat of a divide when it comes to mergers in general, particularly with recent moves in the supermarket industry.  Kosher food sources say that such mergers often result in consolidation and even the closure of many locales. They may also fall victim to more centralized purchasing and the whims of a single buyer rather than at least two or in some cases, multiple buyers. Kroger’s acquisition of Hiller’s in Detroit, a major destination for kosher, is a good example of initial concern but Kroger’s has reassured customers (through this publication) that the merger will not in the least bit affect customers.