Merchants Foodservice celebrates 115 years

By HASKEL BURNS,

On February 11, 1904, the Fain Grocery Company was opened in Hattiesburg by seven stockholders, who brought along 10 employees and two horse-drawn vehicles to service the retail and wholesale grocery trade in the area.

One hundred and fifteen years later, that company – now known as Merchants Foodservice – is still a Hattiesburg mainstay, with its corporate office on Edwards Street. But it’s far outgrown its humble origins of more than a century ago, having grown into the 12th-largest foodservice distributors in the United States, with 900 employees throughout 12 states and more than $800 million in annual sales.

“It’s very gratifying (to have been in business this long),” said Andy Mercier, president and CEO of Merchants. “I think it’s a sign of the employees we have, and the commitment to doing the right thing for our customers, that we’ve been able to exist this long. It’s just very satisfying.”

The Merchants Grocery Company name was adopted in 1907, three years after the Fain Grocery’s founding, and construction began later that year on a two-story, $29,950 brick warehouse. The company constructed its first cornmeal mill in 1915, adding a grain elevator and a feed mill two years later.

A cold storage plant for fresh fruit and vegetables was added in 1920, and three years later, officials celebrated the company’s first $1 million in sales. The Merchants Grocery Company expanded in 1924 with a feed manufacturing plant in Laurel, and officially changed its name to The Merchants Company in 1927.

The next several years brought more expansion, with the company opening a meat-packing house for pork and beef in 1931. The packing house brought in $295,000 in its first year.

Grain operations were moved in 1950 to Vicksburg to allow for better access to barges on the Mississippi River, and in 1959, the company opened Forrest Farms – an integrated poultry plant – in Hattiesburg. That plant was later purchased by Marshall Durbin.

Merchants opened the Pine Burr Packing Company in Hattiesburg in 1961, a venture that lasted almost two decades until it closed in 1980.

In 1982, Merchants converted to a new business model as a food distribution company and restaurant supplier, selling the grain elevators and consolidating seven distribution centers into two expanded facilities. Five years later, the company ended retail operations and converted to total foodservice sales.

In 1988, The Merchants Company became a wholly-owned subsidiary of Tatum Development Company, and the next year purchased a facility in Montgomery, Alabama. The company achieved $100 million in annual sales in 1999.

The 2000s brought even more prosperity for Merchants, with a new distribution center built in 2000 in Clanton, Alabama, followed by another in 2003 in Jackson. With the construction of the new Jackson facility, the previous distribution center in Jackson became home to Sunrise Fresh Produce, the produce arm of Merchants.

In 2008, the company expanded into the Carolinas with a distribution center in Newberry, South Carolina, and purchased another distribution center in Tifton, Georgia, to service the company’s national account operations.

The Jackson distribution center was expanded in 2011, with the addition of 29,000 square feet of freezer space and 15,000 square feet of cooler space. For all its efforts, Merchants was awarded in 2013 with the Excellence in Distribution Award by the International Foodservice Manufacturers Association.

The Clanton distribution center was expanded again in 2016 and now boasts 200,000 square feet of dry, refrigerated and frozen warehouse space, with 8 million cubic feet of storage space. That same year, Merchants acquired the E.G. Forrest Company, a food distributor headquartered in Winston-Salem, North Carolina, and added 20 sales representatives to the sales branch in Newberry.

The January 2017 tornado severely damaged the Hattiesburg office – necessitating the temporary relocation of those employees to Purvis – but the company came back stronger than ever. Merchants now delivers an average of 7,500 deliveries per week, 460,000 cases per week and 11,000,000 pounds of food per week within its service area, which stretches across the southeast United States.

That reach extends west to the Louisiana/Texas border all the way east to the southern part of Virginia.

Basically, what we do is provide products for anyone who is serving food,” Mercier said. “That would be independent restaurants, schools, health care facilities and even jails.

“So anybody who is taking food, preparing it and serving it to others, that’s what we do.”

The company also offers more than 12,000 in-stock line items, including frozen entrees, fresh produce, meats, and cooking and cleaning supplies.

Merchants provides services to many organizations in the Hub City, including Edwards Streets Fellowship center and Christian Services. Over the past five years, the company has donated more than 200,000 pounds of food to local food banks.

“One of the things I’m most proud about is that we’ve got a lot of employees that have been here almost their entire life,” Mercier said. “My former CEO, Don Suber, retired after 50 years with the company, and we’ve got another gentleman working for us right now who is in his 51st year.

“So watching these employees, and knowing that we’ve been able to provide them a living, and them providing for their family as their family grows and they have kids, that’s pretty satisfying.”

As one can imagine, Mercier – who has been with the company for 26 years – has witnessed a lot of changes over the past two and a half decades.

“The technology has changed a lot, so being able to keep with technology has exponentially accelerated in this industry, and in every industry,” he said. “It’s gone from doing things manually, with a pencil and pen, to everything being done over the Internet and electronically now. So being able to keep up with that all these years, whereas some companies have failed, I think is a big testimony to our success.”

After 115 years in business, Mercier’s plan for the future is pretty simple: to provide the same level and quality of service to his customers as in the past.

“Right now, we’re in a slow growth mode, so we’re just going to continue doing what we’ve done,” he said. “I think we’re doing things the right way – not necessarily the fastest way or in a pursuit of trying to get to a certain number.

“We’re privately owned, so we’re not trying to meet Wall Street’s expectations. We’re just trying to do the right thing for our customers and our employees right now. I think the next best thing for us is just to continue to serve our customers as best as we can.”