This is why Amazon will need to keep unions out of its grocery business. The Chicago Tribune explains the bankruptcy of Central Grocers:
After almost 100 years of doing business, Joliet-based Central Grocers filed for Chapter 11 bankruptcy Thursday and will lay off about 550 employees at the company’s Joliet warehouse.
Central Grocers is a grocery cooperative that has long operated as wholesaler for more than 400 independent grocery stores in the Chicago area — including chains like Treasure Island, Pete’s Fresh Market, Angelo Caputo’s Fresh Market and Sunset Foods — distributing private-label Centrella products as well as produce, meat and dairy. It’s also the parent company of Strack & Van Til and Ultra Foods stores in Illinois and Indiana, which are included in the bankruptcy filing. The layoffs are expected to occur between June 26 and July 10 as the cooperative’s business gradually shuts down, according to a mass layoff notice sent to employees Wednesday….
Central Grocers’ Chapter 11 filing comes after a group of suppliers, including Coca-Cola, General Mills and Mars Financial Services, filed a petition Tuesday to force the grocery cooperative into involuntary Chapter 7 bankruptcy.
The company’s bankruptcy filings listed its total assets at about $262 million and its total liabilities at about $232 million. Central Grocers is seeking debtor in possession financing.
Highland Park-based Sunset Foods also recently enlisted a new distributor for grocery items — such as crackers, soups and cereals — that its five stores had been stocking from Central Grocers, said Thaddeus Tazioli, vice president of marketing for Sunset.
“Obviously there were issues with the organization and so a decision had to be made about what to do next,” he said. “It’s really exciting, from our perspective, the opportunities that are going to open up.”
Sunset is now working with Supervalu, which will supply Sunset with brands the stores were not receiving from Central Grocers, Tazioli said….
Representatives of locals 703 and 710 of the Teamsters, the union representing the bulk of the Joliet Central Grocers employees facing layoffs, couldn’t be reached for comment.
Read more here.
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