One can’t help but notice there’s a persistent pessimism among food distributors that “the big are getting bigger”. I have sensed this sentiment everywhere, from trade shows to boardroom discussions to the feeds of LinkedIn. It seems like  independents have resigned themselves to an inevitable fate of consolidation and decline. And I understand where that feeling comes from. Earlier this year, US Foods acquired IWC Food Service, the latest in a series of nineteen acquisitions since 2016. Sysco, over that same time period, completed twenty acquisitions. 

Sysco, US Foods, and Performance Food Group (PFG)—The Big 3—have been on a winning spree over the last two decades, but is their rise to dominance truly an inevitability?

Over the course of my career, I've witnessed how technological shifts can fundamentally reshape industries–democratizing opportunities, enabling smaller players to outcompete against incumbents in new and disruptive ways. This is the reshaping we’re seeing take place in food distribution today.

We’ve entered an era where independents can flip the long-standing script, disrupt the Big 3, and thrive. Let me share why I'm optimistic about our future, and why it's time for independents to go on the offense and lead through innovation.

Their Strongholds Will Not Keep Them Safe

The legacy incumbents in any industry want to preserve the status quo, where they’ve laid a firm foundation at the top of their mountain. Shifts in technology compromise that foundation, opening up cracks for new players to emerge and break out. It's a pattern we've seen play out over and over again.

• The cannonball gave small armies the ability to overcome grand castles
• The Internet gave Craigslist the ability to disrupt newspaper classifieds 
• Social media offered a new way to reach audiences at scale, without any reliance on established media
• Shopify armed independent eCommerce merchants with the tools to win in a world that had been dominated by mass retailers

Now, we stand at the cusp of another transformative wave: Artificial Intelligence (AI). Like its predecessors, AI has the potential to level the playing field even further. AI enabled tools will create the greatest gains for those who embrace them early on. The agility of independent distributors—unconstrained by the massive scale of The Big 3—has the potential to be a huge advantage.

• Bureaucracy doesn’t slow you down. Giants tend to be slow-moving. They do revenue impact studies, they hire out teams of managers, they implement new technologies cautiously. Meanwhile, you can be testing and refining new tech in the field.

• You’re not a distant corporation. You know your customers by name, are in-tune with your market, and can tailor your service accordingly. Big box distributors cannot hope to compete on the personalized service and presence of a smaller local company.

This has been a driving thesis for how we are building Pepper, our eCommerce and sales tools platform for independent distributors. No longer do you need multimillion-dollar budgets to build out sophisticated ordering systems and hire data analysts. Independent distributors can now leverage powerful, industry-specific tools that offer feature parity with the big players, all at a fraction of the cost, and while leaning into their more flexible and relational operations.

The cycle is turning, and technology is the catalyst. Independent distributors who can adopt a culture of experimentation and innovation have everything to gain.

Leveling The Playing Field for Independents

At Pepper, we're not just talking about the potential for independents to thrive—we're actively creating the tools to make it happen. Here’s how we're leveling the playing field and giving independents the firepower to compete with the giants.

eCommerce Ordering Makes You Just As Convenient

Big box distributors enjoyed nearly a decade head start with high-end, expensive online ordering platforms that were miles ahead of the analog (voice, email, text) ordering and product discovery workflows that were status quo for independents. As operators became more familiar with online ordering apps like Amazon, UberEats, and Instacart, they began to expect this level of interface simplicity and ordering flexibility for their business. This was a huge advantage for the Big 3. Was.

Pepper’s online ordering platform enables independents to go toe-to-toe on convenience and feature parity, closing the gap that big box distributors created with their proprietary platforms. You don’t need to invest millions to build out a price optimization system anymore. You don’t need to blow the payroll budget by hiring a team of engineers and managers to optimize product pages or resolve software bugs. They no longer tower above you when it comes to online ordering—and the impact of the improved customer experience is clear.

Big box distributors have invested tens of millions developing custom connections to product databases for accurate product photos and descriptions. At Pepper, we’ve developed the capability for all of our partner distributors to enrich their catalogs and offer a photo-filled browsing experience at less than a hundredth of the cost

The AI-Enabled DSR

Our sales engagement suite, DSR Connect, gives your reps everything they need to prospect new customers and increase the profitability of existing ones.

Reps can create AI-generated sample order guides for new customers based on real menu items and prices, making prospecting more targeted and efficient. They can edit item pricing on the fly with real-time profitability calculations, ensuring optimal deals for both you and your clients. The system also monitors customer behavior and alerts DSRs to potential upsell opportunities or churn risks.

At their fingertips, reps have access to historical pricing trends, inventory insights, and local pricing comparisons. DSR Connect truly enables your sales reps to be strategic advisors. It's arming your DSRs with a superpower, sending your reps into the field with a more comprehensive set of tools than even the largest distributors supported by sophisticated IT departments. 

Be a True Marketing Partner to Your Suppliers

One of the most exciting advancements is how independent distributors can now form deeper partnerships with manufacturers. In the past, large manufacturers focused their marketing budgets on broadliners due to their reach—they could connect with tens of thousands of operators through a single relationship. Engaging with smaller distributors on a wide scale wasn’t feasible.

Pepper Ads changes that. It enables independent distributors to be part of these campaigns, helping them grow their sales and customer base while providing manufacturers with new ways to connect with operators and distributors they couldn’t easily reach before.

This levels the playing field—not by taking power from larger distributors, but by opening doors for independents to collaborate in ways that weren’t possible before. Manufacturers now have a more efficient way to partner with distributors of all sizes, creating shared opportunities for growth.

At Pepper, our goal is to democratize access to powerful tools that help you compete on service, local expertise, and now, through partnerships that truly drive value. We're empowering independent distributors to deliver meaningful connections between suppliers and operators, benefiting everyone involved.

Leveling the Playing Field Is Just the Beginning

We’re proud to provide tools that level the playing field, but technology alone isn't a silver bullet. The real magic happens when innovative distributors take the initiative to turn these new opportunities into real outcomes.

Winners from technological shifts are the companies who invest early enough to get disproportionate benefit relative to their competitors.

Experiment with new strategies. Nurture a culture of excitement for change and improvement. Partner with forward-thinking customers who are open to testing new ideas or processes. Your agility is your advantage. Use it to outmaneuver larger, slower to move, more bureaucratic incumbents.

The future of food distribution belongs to those who dare to innovate. With a partner like Pepper behind you, you have everything you need to not just survive, but outperform in this new landscape. Together, let’s create the future for independents to continue to thrive.