Sprouts nationally distributes local brands

Sprouts Farmers Markets is partnering with a business-to-business wholesale marketplace to ensure supply chain agility and diversify its assortment.

The organic grocer is expanding a partnership with Pod Foods it initially rolled out in 130 stores in spring 2022 across all of its approximately 380 stores in 23 states nationwide. Pod Foods will now expand coverage to all Sprouts stores, providing these new stores with access to brands that may be locally-based in one state or region of the country, regardless of their location.

Sprouts is employing hosted logistics capacity from Pod Foods to become more agile in the face of shortages or slowdowns, giving its supply chain extra elasticity. In addition, in the event of product shortages, the retailer can obtain instant access to alternative products, sourced locally from across the country.

As a further investment into the partnership, Pod Foods has opened three new dedicated warehouses to service the demand coming from Sprouts. On the brand side, Sprouts is gaining options outside of traditional distribution networks to place local brands in stores outside their normal distribution area, no matter the order size.

"With Sprouts, we've quickly validated why there is a need for agile distribution and an enhanced marketplace of options in today's volatile landscape," said Larissa Russell, co-founder, and CEO of Pod Foods. "Expanding our reach will help the brands we work with scale, while Sprouts reaps the benefits of being able to offer a totally unique and shifting list of emerging brands to their consumers."

"Scaling up to a national level can seem daunting, but we see it as an incredible opportunity. Brands who might have plateaued in terms of growth due to limited order sizes now may start to see their first wholesale orders coming in from across the country," said Fiona Lee, co-founder and CPO at Pod Foods. "By handling the challenges that can come with ramping up distribution across an entire country, Sprouts has peace of mind that orders will arrive promptly and brands are able to keep their eye on continuing to innovate the next best product."

Sprouts expands distribution footprint
In addition to contracting with Pod Foods for third-party distribution and logistics services, Sprouts has also been adding to its internal network of distribution centers. This has included a produce distribution center it opened in Orlando, marking its first distribution center in Florida.

Sprouts is partnering with Penske Logistics as its third-party logistics provider for the distribution center and dedicated transportation fleet. The 135,000-sq.-ft. facility includes 34°F and 55°F storage and fruit ripening rooms that are ideal for the grocer’s wide variety of fresh produce. 

The grocer previously announced it will drive efficiencies across its network of fresh distribution centers by locating them within 250 miles of the stores they serve, allowing for fresher, local assortment.

Headquartered in Phoenix, and one of the largest and fastest-growing specialty retailers of fresh, natural and organic food in the U.S., Sprouts employs approximately 31,000 associates in its 380 stores.