Food Distribution in New York City New York City Economic Development Corporation Mayor’s Office of Recovery and Resiliency

New York City’s food distribution system is among the largest in the United States New York City is a large city with complex infrastructure challenges Our food system must feed our population of 8.5M people, 60 million tourists every year, and hundreds of thousands of commuters every day. By 2025, we expect to grow to 9.2M people and 1.2M tourists per day The City owns key food distribution points Hunts Point is a City-owned food distribution center with 3 wholesale markets (produce, meat, fish) and a number of private distributors Brooklyn Wholesale Meat Market provides space for meat/fish distributors The City owns a number of other assets (e.g. Bush Terminal) that we are trying to chart a strategy for, including potential food uses The city’s distribution also depends on a number of private players with their own distribution assets [e.g. Jetro, C&S, Sysco] Resilience of the city’s infrastructure is driving inquiry into our food system On a recommendation from A Stronger, More Resilient New York, The Mayor’s Office of Recovery and Resiliency (ORR) and the New York City Economic Development Corporation (NYCEDC) commissioned this study, conducted by the Boston Consulting Group (BCG)

The goal of the primary research is to build a quantitative understanding of the end-to-end food supply chain

Key findings focused in a few areas Size and structure of food distribution system Approximately 19 billion pounds of food are distributed throughout NYC each year from approximately 42,000 point of sale outlets Geographic distribution of food businesses Food businesses benefit from the efficiencies of clustering, receiving shipments and customer pick-up. Hunts Point is the largest geographic hub in NYC. Preparedness NYC point of sale outlets keep 4 to 5 days of stock on average. The City’s food system is highly fragmented and therefore is unlikely to be significantly impacted by disruption to a single distributor. Point of sale outlets are more likely to buy insurance to address risk rather than make physical investments in resiliency Transportation 99% of last mile delivery is done by truck, and 4 bridges and 2 tunnels carry over 50% of food volume into the city Food Distribution Jobs Food distribution jobs can be high quality, accessible industrial jobs and are less at risk of being automated relative to food manufacturing jobs.

Size and Structure of the food system Finding 1 New York City’s food supply chain is a dynamic system comprised of numerous food distributors and a variety of point-of-sale (POS) outlets.

Size and Structure of the food system Finding 1 New York City’s food supply chain is a dynamic system comprised of numerous food distributors and a variety of point-of-sale (POS) outlets.

Size and Structure of the food system Finding 1 Demand for food in New York City is growing at 1.6% per year (double the national average of 0.7%). Online grocery is expected to capture 6% of the point-of-sale market by 2025. 2015 42,000 POS outlets 19.2 billion lbs of food per year 51% Regional Distributors ; 13% Cash and carry 2020 45,700 POS outlets 20.7 billion lbs of food per year 48% Regional Distributors ; 16% Cash and carry 2025 49.400 POS outlets 22.6 billion lbs of food per year 45% Regional Distributors ; 18% Cash and carry

Geographic Distribution of Food Businesses Finding 2 There are several food distribution clusters across the City, including Hunts Point, College Point, and Sunset Park. Hunts Point is the largest geographic hub for food distribution by volume. Take new screenshot without call-out flag

Geographic Distribution of Food Businesses Finding 2 4.5 billion lbs of food is distributed through the Hunts Point Food Distribution Center annually. ~50% or 2.3 billion lbs goes to NYC.

Geographic Distribution of Food Businesses Finding 2 Independent Restaurants are the largest customer segment served by Hunts Point

Preparedness Finding 3 The distribution landscape is highly fragmented, with no single distributor or geographic hub having higher than a 15% share. Due to a limited amount of point-of-sale on-site storage space, the New York City food system holds on average roughly 4 to 5 days of regular consumption of food stock. National foodservice distributors and national grocery distributors are better prepared for disruption than regional distributors or cash and carry wholesalers. Point-of-sale outlets are more focused on maintaining income continuity than operational continuity during disruptions. Therefore, they are more likely to invest in business and/or flood insurance than in physical preparedness, since insurance is a lower-cost option for ensuring income continuity. Consumers face additional vulnerabilities if they are low-income, lack mobility, face geographic isolation and/or have limited choices of where to purchase food on a daily basis.

Transportation and Truck Routes Finding 4 The City’s food distribution system relies on bridges and tunnels to reach their consumers, since 99% of last-mile distribution is done by truck. A combination of four major bridges and two tunnels carry over 50% of total food volume.

Food Distribution Jobs Finding 5 Employment in the food distribution sector includes high-quality industrial jobs. Food manufacturing jobs are projected to increase by 0.3%. Food distribution jobs will increase by 0.4%.

Next Steps Integrate and coordinate findings with ongoing studies Preparedness and transportation dependencies Integrate and coordinate findings with ongoing studies Evaluate potential for additional resiliency measures Identify ways to support food distributors and point of sale outlets during an emergency event Engage with community groups to discuss the potential for partnerships to advance resiliency Food system structure, distribution trends, clustering and jobs Continue the implementation of the $150 million Hunts Point Food Distribution Center modernization plan Tenant the new 55,000 SF food manufacturing hub at the Brooklyn Army Terminal Annex Building Explore opportunities to integrate additional modes of freight transportation into the food supply chain and distribution system.