What changed in this filing

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Item 1. Business

2024-02-27 compared with 2023-02-28 · 45 added, 35 removed, 268 unchanged (23% of the section changed)

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(“Allen Brothers”) mail and e-commerce platform.

We also market a broader variety of our products directly to consumers via our “Shop Like a Chef” online home delivery platform which operates in several of the markets we serve.

Since our formation in 1985, we have expanded our distribution network, product selection and customer base both organically and through acquisitions.

Our net revenues have increased from approximately $1.6 billion for the fiscal year ended December 27, 2019 to $3.4 billion for the fiscal year ended December 29, 2023.

Our historical sales growth and our ability to manage through the material adverse impacts of the Pandemic on our business are the result of an increase in the breadth and depth of our product portfolio, our commitment to customer service, the efforts of our experienced and sophisticated sales professionals, the increased use of technology in the operations and management of our business and our ongoing consolidation of the fragmented specialty foodservice distribution industry.

Since December 28, 2018, we have completed sixteen acquisitions which have increased our penetration in existing markets, expanded our footprint into new markets and/or enhanced our product capabilities.

The up-front cash purchase prices for these sixteen acquisitions resulted in aggregate up-front cash consideration of more than $294.5 million, which we funded with cash generated from our operations, borrowings under our then existing credit facilities and the proceeds of our common stock offerings.

Our historical sales growth and our ability to manage through the material adverse impacts of the Covid-19 Pandemic (“Pandemic”) on our business are the result of an increase in the breadth and depth of our product portfolio, our commitment to customer service, the efforts of our experienced and sophisticated sales professionals, the increased use of technology in the operations and management of our business and our ongoing consolidation of the fragmented specialty foodservice distribution industry.

Since December 27, 2019, we have completed nineteen acquisitions which have increased our penetration in existing markets, expanded our footprint into new markets and/or enhanced our product capabilities.

The up-front cash purchase prices for these nineteen acquisitions resulted in aggregate up-front cash consideration of more than $387.2 million, which we funded with cash generated from our operations, borrowings under our then existing credit facilities and proceeds of our common stock offerings.

Excluding our direct-to-consumer businesses, we currently serve more than 44,000 core customer locations in our twenty-three primary geographic markets across the United States, the Middle East, and Canada.

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We believe that the breadth and depth of our product portfolio facilitates our customers’ ability to distinguish and enhance their menu offerings and differentiates us from larger traditional broadline foodservice distributors.

For example, we provide a selection of more than 200 different varieties of olive oil, while large broadline foodservice distributors only carry, on average, 5-10 types of olive oil.

Critical Route-to-Market for Specialty Food Suppliers.

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Increase Penetration with Existing Customers.

We intend to sell more products to our existing customers by increasing the breadth and depth of our product selection and increasing the efficiency of our sales professionals, while at the same time continuing to provide excellent customer service.

We intend to sell more products to our existing customers by increasing the breadth and depth of our product selection and increasing the efficiency of our sales professionals, while at the same time

continuing to provide excellent customer service.

We are a data-driven and goal-oriented organization, and our management and sales professionals are highly focused on our weekly sales and gross profit contribution from each of our Core Customers and increasing the number of unique products we distribute to such customers.

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We believe we have the opportunity to capitalize on our existing infrastructure and expertise by continuing to selectively pursue opportunistic acquisitions in order to expand the breadth of our distribution network, increase our operating efficiency and add additional products and capabilities.

Since our initial public offering (“IPO”), we have completed thirty-one acquisitions, which have increased our penetration in existing markets, expanded our footprint into new markets and enhanced our product capabilities.

Since our initial public offering (“IPO”), we have completed thirty-six acquisitions, which have increased our penetration in existing markets, expanded our footprint into new markets and enhanced our product capabilities.

Our Markets and the Customers that We Serve

Excluding our direct-to-consumer business, we distribute our specialty food products to over 40,000 distinct core customer locations from distribution centers located in our primary markets, which include New York, Washington, D.C., Los Angeles, San Francisco, New England, Las Vegas, Miami, Portland, Columbus, Cincinnati, Chicago, Vancouver, Edmonton, Toronto, Seattle, Sacramento, Philadelphia, Texas, Denver, Dubai, Abu Dhabi, Oman and Qatar.

We distribute our specialty food products to over 44,000 distinct Core Customer locations from distribution centers located in our primary markets, which include New York, Washington, D.C., Los Angeles, San Francisco, New England, Las Vegas, Miami, Portland, Columbus, Cincinnati, Chicago, Vancouver, Edmonton, Toronto, Seattle, Sacramento, Philadelphia, Texas, Denver, Dubai, Abu Dhabi, Oman and Qatar.

We believe that many of these markets set the culinary trends for the rest of the United States, Middle East and Canada and provide us with valuable insight into the latest culinary and menu trends.

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Our target customers include menu-driven independent restaurants, fine dining establishments, country clubs, hotels, caterers, culinary schools, bakeries, patisseries, chocolateries, cruise lines, casinos and specialty food stores.

We have no meaningful customer concentration as our top ten customers who accounted for less than 6.5% of total net sales for our 2022 fiscal year.

We have no meaningful customer concentration as our top ten customers accounted for less than 6.1% of total net sales for our 2023 fiscal year.

Our Allen Brothers subsidiary markets certain of our center-of-the-plate proteins directly to consumers through a mail and e-commerce platform.

Additionally, in response to the Pandemic, we expanded our direct-to-consumer product offerings by launching our “Shop Like a Chef” online home delivery platform in several of the markets we serve.

Set forth below is a breakdown of the primary geographic markets we serve and the year we entered each market:

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Our buyers have numerous contacts with suppliers throughout North America, Europe, Asia and South America and are always looking for new and interesting products that will aid our customers as they seek to keep up with the latest developments in the culinary industry.

Our ability to successfully distribute a significant portion of the total production of smaller, regional and artisanal specialty food producers allows us the opportunity to be these producers’ primary route-to-market in our markets without, in most cases, requiring us to make contractual commitments regarding guaranteed volume.

Our ability to successfully distribute a significant portion of the total production of smaller, regional and artisanal specialty food producers allows us the opportunity to be these producers’ primary route-to-market in our markets without requiring us to make contractual commitments regarding guaranteed volume.

We are also able to leverage our scale and successful track record of distributing products sourced from outside the United States and Canada to minimize importing costs.

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Products are delivered to our distribution centers primarily by contract carriers, the suppliers themselves and our fleet of trucks.

Out trucks are either owned or leased from national leasing companies and regional firms that offer competitive services.

Our trucks are either owned or leased from national leasing companies and regional firms that offer competitive services.

Customer orders are assembled in our distribution centers and then sorted, placed on pallets and loaded onto trucks and trailers in delivery sequence.

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Intellectual Property

Except for the Spoleto, Bel Aria, Grand Reserve, Provvista, Argonaut, Praml, Black Falls, Michael’s, Chocoa, Crescendo, Matisse, Qzina, Coccinelle, Allen Brothers, The Great Steakhouse Steaks, Del Monte, Fells Point, Bassian Farms, Sid Wainer & Son, Cambridge Packing, Foley Fish, Silver State Meats, Sid Wainer & Son, Alexis Foods, Chef Middle East, and The Chefs’ Warehouse trademarks, we do not own or have the right to use any patent, trademark, trade name, license, franchise or concession, the loss of which would have a material adverse effect on our business, financial condition or results of operations.

We have registered and/or applied to register a variety of trademarks and serve marks used throughout our business, as well as domain names, and rely on a combination of copyrights, patents, trademarks, trade names, licenses, franchises and concessions.

We are not aware of any facts that could materially impact the continuing use of any of our intellectual property.

The foodservice distribution industry is highly competitive.

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Environmental, Social and Governance

We are committed to upholding ethical, socially responsible and environmentally conscious business practices, consistent with

our corporate values, to promote long-term and sustainable change.

In 2022, our board of directors formed an Environmental,

Social and Governance Committee (the “ESG Committee”) to oversee our environmental, social and governance activities and

We are committed to upholding ethical, socially responsible and environmentally conscious business practices, consistent with our corporate values, to promote long-term and sustainable change.

In 2022, our board of directors formed an Environmental, Social and Governance Committee (the “ESG Committee”) to oversee our environmental, social and governance activities and

Among other things, the ESG Committee reviews and evaluates:

our progress towards meeting our diversity goals

and compliance with our responsibilities as an equal opportunity employer;

our workplace safety, employee health and

wellness, inclusion, employee training and skill improvement and other human capital management initiatives;

programs and activities relating to environmental sustainability, product quality and quality assurance, social and community

relations (including labor relations) and other related economic and regulatory compliance requirements.

our progress towards meeting our diversity goals and compliance with our responsibilities as an equal opportunity employer;

our workplace safety, employee health and wellness, inclusion, employee training and skill improvement and other human capital management initiatives;

and our programs and activities relating to environmental sustainability, product quality and quality assurance, social and community relations (including labor relations) and other related economic and regulatory compliance requirements.

Workforce Health and Safety

The safety and health of our employees is a top priority for us.

In response to the Pandemic, we implemented new procedures and protocols recommended by the Centers for Disease Control, federal and state governments, and other major health authorities.

This includes, but is not limited to, instructing our employees to practice social distancing on our premises and those of our customers, frequent sanitation of our work environments, truck fleet and equipment, supplying personal protective equipment to our workforce and allowing our administrative employees to work from home.

Our safety culture is maintained and strengthened by periodic trainings for employees and senior management, as well as labor, health, anti-discrimination and anti-harassment policies, and we are committed to maintaining a safe and healthy work environment in all aspects of our business.

In this effort, we provide and require various trainings to ensure a wide understanding of standards, expectations, and best practices.

Additionally, all of our fleet drivers are taught the Smith System for road safety.

This system provides our drivers with tools and knowledge to make smart decisions behind the wheel, reducing the risk of accidents and injuries while ensuring timely deliveries to our customers.

Managers who oversee drivers also complete safety leadership training through the Federal Motor Carrier Safety Administration’s Compliance, Safety, Accountability program.

By implementing such trainings at every level of our operations, we are able to provide our customers with the exceptional service they expect without compromising the safety and comfort of our employees.

Professional Development

Providing career development opportunities for our employees is a top priority.

As an investment in the professional growth of

our employees, professional learning and development courses are provided for all employees.

Our employees can readily

choose to take courses in categories such as safety, leadership, management, sales and business acumen, and courses may also

be assigned to our employees based on job function.

As an investment in the professional growth of our employees, professional learning and development courses are provided for all employees.

Our employees can readily choose to take courses in categories such as safety, leadership, management, sales and business acumen, and courses may also be assigned to our employees based on job function.

Diversity, Equity and Inclusion

We believe that a diverse workforce creates a healthier, stronger and more sustainable company.

As a foundation of diversity and inclusion, we focus on increasing underrepresented populations across our business.

In 2023, more than two-thirds of our employees, and more than 20% of our management, were diverse.

We have diversity equity & inclusion monthly programming that celebrates the wide variety of diverse employees and topics that impact our employees.

Each year, we conduct mandatory training on diversity equity & inclusion topics and provide managers with practical tools to operate in today’s global environment and develop their skill sets, awareness and business acumen in this on-going matter of being diverse and inclusive.

Social and Environmental Responsibility

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Department of Agriculture (“USDA”).

The USDA imposes standards for product quality and sanitation, including the inspection and labeling of meat and poultry products and the grading and commercial acceptance of produce shipments from vendors.

The USDA imposes standards for product quality and sanitation, including the inspection and labeling of meat and poultry products and the grading and

commercial acceptance of produce shipments from vendors.

The products we distribute in Canada are subject to regulation and inspection by Health Canada and the Canadian Food Inspection Agency.

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Despite a significant portion of these sales occurring in the fourth quarter, there are operating expenses, principally advertising and promotional expenses, throughout the year.

The Pandemic has had a material impact on our business and operations and those of our customers.

Our net sales were most significantly impacted during the second quarter of fiscal 2020 when, in an effort to limit the spread of the virus, federal, state and local governments began implementing various restrictions that resulted in the temporary closure of non-essential businesses in many of the markets we serve, which forced our customers in those markets to either transition their establishments to take-out service, delivery service or temporarily cease operations.

Our profitability is dependent, among other things, on our ability to anticipate and react to changes in the costs of key operating resources, including food and other raw materials, labor, energy and other supplies and services.

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Vice Chairman and Director

59 John Pappas is a founder of our company and currently serves as our Vice Chairman, a position he has held since March 1, 2011.

From our founding in 1985 to March 1, 2011, he served as our Chief Operating Officer.

60 John Pappas is a founder of our company and currently serves as our Vice Chairman, a position he has held since March 1, 2011, and Chief Operating Officer, a position he held from our founding in 1985 to March 1, 2011, and again on February 24, 2022 to the present.

He has 25 years of experience in logistics, facility management and global procurement and oversees our network of distribution centers nationwide.

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in Economics from Fordham University.

Name & Position

Business Experience

Alexandros Aldous

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McCauley holds a Bachelor of Science degree in Business - Accounting from the University of Connecticut and is a registered certified public accountant in the state of Connecticut.

Christina Polychroni

Chief Human Resources Officer

44 Christina Polychroni is our Chief Human Resources Officer since December 31, 2022.

Prior to this appointment, Ms.

Polychroni served as the company’s Chief Talent Officer from November 1, 2021 through December 30, 2022.

Polychroni is a management executive with a track record in multinational companies and a strong knowledge of the luxury and food industries in wholesale, retail and digital channels.

Polychroni’s prior work experience includes her tenure as Chief Marketing and E-Commerce Officer at L’Occitane USA, Chief Marketing Officer at Jack Rogers USA, as well as senior marketing roles in KORRES USA and the Unilever Ice Cream and Nutrition divisions.

Polychroni holds a B.A.

in Marketing and MBA from the Athens University of Economics and Business, a Human Resources Management Certificate from Cornell University, and a PhD in Management from the School of Business at the Stevens Institute of Technology.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business