Liquidation Begins for Central Grocers – 550 Out of Work


After almost a century in business, Joliet, Illinois-based Central Grocers is having a liquidation sale at its one-million-square-foot warehouse and distribution center. The facility was previously used by independent member-owners of the Central Grocers cooperative.

Central Grocers is winding down operations after filing Chapter 11 back in May, two days following the filing of an involuntary Chapter 7 case by creditors. Central Grocers had assets of $262.0 million and liabilities of $232.0 million. The cooperative was hoping to secure financing to keep it going during the bankruptcy process, but to no avail.

Shuttering its doors has put 550 out of work. The layoffs occurred between June 26 and July 10.

Central Grocers is a grocery cooperative that 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. It also distributed 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 also included in the bankruptcy filing.


There is no buyer for Central’s warehouse yet, but the sale of more than $20.0 million in inventory has begun, with dry grocery products, fresh meat, and frozen food being sold at up to half off wholesale prices. The inventory includes major brands from the likes of Danone SA, General Mills, Inc. (NYSE:GIS), Kraft Heinz Co (NASDAQ:KHC), Nestle SA, and Pepperidge Farm, Incorporated.

In April, Central Grocers announced a plan to sell 22 Strack & Van Til stores and closed nine underperforming Ultra Foods stores. It was expected that about 750 employees at the Cook Country Ultra Foods stores would lose their jobs in June. Strack & Van Til was Central Grocer’s largest distribution customer and was 80% owned by the cooperative. 

Central Grocers said it expects to enter into a sales agreement for 19 Strack & Van Til stores soon, with Jewel Food, owned by Albertsons Companies Inc. Jewel’s offer for those assets was $100.0 million.

In Central Grocers’ bankruptcy filing, the company said, “While the traditional, independent grocer has long faced peripheral competitive challenges from the likes of warehouse clubs, drug stores, and convenience stores, it now is losing market share to online retailers.”

The cooperative also said it couldn’t keep up financially or with marketing for customers’ growing desire for “gourmet shopping experiences” and more natural, organic, and gluten-free options.

Another reason for Central Grocers’ demise has been food deflation, which is cutting into grocery retailers profit margins, which were already thin to begin with. Since 1967, the grocery retail industry has seen very gradually increasing annual food prices–until 2016, that is, when food prices dropped below the prior year’s levels.


Central Grocers warehouse liquidation begins,” Supermarket News, June 26, 2017.

Central Grocers’ bankruptcy signals trouble for ‘dinosaur’ supermarkets,” Chicago Tribune, May 11, 2017.

Jewel makes $100M offer for 19 Strack & Van Til stores,” Supermarket News, May 15, 2017.