- 9 minutes ago
From massive warehouses and high-tech distribution centers to fresh produce facilities and restaurant kitchens, we go behind the scenes at Sysco to see how it delivers food, supplies, and ingredients to more than 670,000 customer locations worldwide. In this episode of Big Business, we follow the journey from the factory floor to the delivery truck and meet the chefs and restaurant owners in New York City who rely on Sysco to keep their businesses running. But as Sysco pursues its biggest acquisition ever, Jethro Restaurant Depot, some operators worry about what the deal could mean for competition, prices, and the cost of eating out.
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00:00Any time you sit down at a restaurant in the U.S., there's a good chance what you're eating came
00:06from Cisco.
00:09Over the years, it's bought dozens of companies, building an $80 billion empire.
00:17Now Cisco wants to make its biggest buy yet, Restaurant Depot, a low-cost warehouse where chefs shop for themselves.
00:24On an average trip, I'm saving somewhere around $50 to $100.
00:28Critics say the deal could remove one of the few ways restaurants keep Cisco's prices in check.
00:35To understand how Cisco got so big, we got rare access to its warehouses and the suppliers that keep them
00:42stocked.
00:45Then we went shopping with a chef to find out why having another option matters and whether this deal could
00:51affect what restaurants pay for the food on your plate.
01:01Cisco is known as a broad-line food distributor, meaning it sells and delivers hundreds of thousands of products a
01:07restaurant might need.
01:09Everything from frozen french fries to hand soap.
01:13It sources these products from other companies, like Buckhead, one of its specialty meat suppliers, which Cisco acquired in 1999.
01:23Since then, Buckhead expanded from a single cut shop into 25 facilities across North America.
01:29Nobody in the building is a vegetarian, but actually our director of human resources is a vegetarian.
01:35Is that allowed?
01:36It is allowed. We can allow that.
01:39Anything that is a usable trim will go down into the air belt right here.
01:44And that goes into these big mine carts that we'll pack off.
01:47And those goes to cooking shops, right?
01:49People that make frozen homemade meatballs at the grocery store that you get or hot dogs.
01:53Plant manager Dan Smith says these machines evenly slice meat like steak fillets and tenderloins.
01:59So restaurants know exactly how many ounces of protein they're getting.
02:03Laser beams scan a chunk of meat.
02:06Then a computer calculates the maximum number of steaks it can cut from that chunk.
02:10It's going to automatically adjust the belt speed to get the maximum number of driver portions that we're looking for.
02:18Another specialty inside this 28,000 square foot plant is dry aging.
02:23Some of the best steakhouses in the country are always going to offer a dry aged steak because of that
02:29strong, umptious flavor.
02:32But Cisco didn't stop after buying Buckhead.
02:35A year later, it acquired Fresh Point, which supplies most of its produce.
02:40Back then, Fresh Point had 22 locations.
02:44Today, it has 32, making it the largest wholly owned fruit and vegetable distributor in North America.
02:51Supplying Cisco with 750,000 pounds of produce.
02:56Thousands of cases of watermelon, cauliflower and tomatoes arrive at this Maryland plant every week.
03:03It's 330,000 square feet, about six football fields.
03:08Here machines can chop up and package a head of romaine lettuce in just four minutes.
03:13We also do the exact opposite.
03:15We're cutting peppers by hand, so depending on what our customers need, we adjust our process.
03:22The facility slices, chops and packages roughly 3,000 different products, including grab-and-go salads and sandwiches.
03:31And ready-to-grill veggie kebabs.
03:35Getting all these goods to their final destination is a massive logistical challenge.
03:41Before any Cisco product reaches a restaurant, it's trucked to warehouses like this one, which stocks more than 15,000
03:48products for restaurants in New York City and New Jersey.
03:53You've probably seen a lot of these brands before.
03:57Marquise Johnson is a selector here.
03:59Someone who grabs up to 150 items and organizes them for shipment.
04:04I reference Tetris all the time.
04:07And growing up, I used to love Tetris anyway. I actually have Tetris on my phone.
04:11The hours are long. Marquise's shift can be anywhere from 40 to 75 hours each week.
04:16I'm fairly, like, slim now. You know what I'm saying? But when I first started, I lost 14 pounds.
04:22Marquise has to build the pallet carefully so products don't get crushed or leak.
04:27You have to think in here, but thinking too much will hurt you, because everything is time-based.
04:34Time is money.
04:38A fleet of delivery drivers trucks everything to restaurants.
04:42Evan Burkowski is transporting a pallet across New York City today.
04:45What's the weirdest thing you've ever delivered?
04:47Live lobster.
04:49Yeah.
04:50Because I honestly didn't even know we had that until the box was moving, and I'm like, what is going
04:56on here?
04:58He says he makes between 8 and 14 stops a day.
05:02Moving, lifting, scanning, and unpacking.
05:06And how many steps do you get a day?
05:07I'd say around 20,000 to 30,000 steps a day.
05:13But before truck fleets like this, most food stayed close to home.
05:18In the early 20th century, most restaurants and households got their food locally, from suppliers like butchers, bakers, and egg
05:26farmers.
05:27Then in the 1930s, refrigerated trucks made it possible for wholesalers to move food long distances, while keeping meat, cheese,
05:35and dairy fresh longer.
05:37So in 1946, John Baugh launched Zero Foods Company, a frozen foods distributor.
05:44Seeing its potential, he teamed up with eight other regional food distributors.
05:48In 1969, they officially merged to create Cisco, systems and services company.
05:55Then Cisco went on a buying spree.
05:59After gobbling up Buckhead and Fresh Point, it bought Breaks, one of Europe's biggest food distributors, in 2016.
06:06Then in 2021, Greco & Sons, a major Italian specialty distributor.
06:11Over the decades, Cisco built about 40 private label brands.
06:16These products are made by outside suppliers, but sold under names that Cisco owns.
06:22Together, they generate more than $20 billion in annual revenue.
06:27And Cisco might be getting even bigger.
06:31In March 2026, it announced it was going to buy Jetro Restaurant Depot for $29.1 billion, by far the
06:39largest acquisition in the company's history.
06:43It's known as a cash and carry business.
06:46Chefs physically go there, load up their cart, and buy what they need to run their restaurants.
06:51To understand why Restaurant Depot is so popular, and what its acquisition could change, we joined Chef Rick Lee as
06:58he shopped for supplies for his New Jersey restaurant, Sheena.
07:01You can get wares, you can get like a blender, you can get bleach, you can get a side of
07:07beef, all in one.
07:10As you're walking through the aisles, it's a lot easier to be able to spot it than to scroll through
07:15pages that you're not even specifically looking for.
07:17You get to actually see and touch the products before you buy them.
07:21It's just like going to a grocery store.
07:23That in-person model isn't just convenient.
07:26It can be more profitable, too.
07:29Unlike Cisco, Restaurant Depot doesn't need a fleet of trucks and drivers to deliver every order.
07:34Customers do the shopping and the hauling themselves.
07:39For chefs like Rick, going to Restaurant Depot can also mean avoiding delivery fees, fuel surcharges,
07:44and other costs that come with ordering from a distributor.
07:48But, you know, then you have to fill your car with 400 pounds of chicken.
07:52Not necessarily ideal, but that's why we try to get things that are a little bit easier to handle.
07:58Restaurant Depot gives restaurants something else, leverage.
08:02They can shop there as an alternative when Cisco's prices rise or when the products aren't up to standard.
08:10According to Erica Palmer, co-founder of the Independent Restaurant Coalition, that could disappear if Cisco buys the company.
08:17Let's just say you're really frustrated that the strawberries that you're getting from Cisco are coming off the truck moldy.
08:23And you complain to your Cisco rep and you say, all right, enough, I'm going to buy them from the
08:28local farm or I'm going to buy them from Restaurant Depot.
08:31And the Cisco rep says, wait, I don't want to lose your business. Let me do this for you.
08:37But this isn't the first time Cisco has tried acquiring a competitor.
08:42Back in 2013, it tried to buy rival broad line distributor U.S. Foods.
08:47The FTC sued, saying the deal would reduce competition.
08:51At the time, Cisco argued restaurants would still have other places to buy food because of cash and carry stores
08:57like Restaurant Depot.
08:58But a federal judge sided with the FTC and halted the merger.
09:03Cisco and U.S. Foods later called it off.
09:06They said that the very existence of Restaurant Depot proved that there was competition in the market.
09:11Now they're buying their competition and telling us that it doesn't matter.
09:16But Cisco says Restaurant Depot has a different business model and serves different customer needs.
09:21It says the merger will maintain healthy competition while giving customers more options.
09:27Cisco also told us it isn't planning to raise prices if the deal is approved.
09:31We will not be raising prices to Restaurant Depot through this acquisition.
09:35Brenna says that with Cisco's resources, they can expand Restaurant Depot, as they've done with suppliers such as Buckhead.
09:42We can utilize our supply chain, our warehouses, to bring that product through and our infrastructure to be able to
09:48open up a store.
09:49That's going to bring even more value to the communities.
09:54Today, Cisco supplies approximately 670,000 customer locations worldwide, including restaurants, hospitals, schools and hotels.
10:04More than half of Cisco's revenue comes from American eateries.
10:08Where are you visiting from?
10:10Wisconsin.
10:11Welcome, welcome.
10:12For restaurant chains with multiple locations, Cisco's size can make it easier to keep every kitchen stocked.
10:18Like Carnegie Diner, which operates seven locations across the U.S., serving thousands of customers every day.
10:25Cisco is providing right now almost 90% of our food product.
10:30CEO Stathis Antonokopoulos plans to open four more.
10:34It's about the sourcing of the ingredients, the freshness, and how lackability is right now, or how we like to
10:40call it, how Instagrammable is now.
10:42If we don't have all those four things, then a plate doesn't make it to our menu, and Cisco helps
10:48us that.
10:49The restaurant orders up to eight pallets of products from Cisco's warehouses multiple times a week.
10:55His kitchen managers can place orders through the company's app in 15 minutes and track exactly how much they've spent.
11:01Right now, if I want to know how much I pay the beef in 2024, I can go to the
11:06app and see it on Cisco in seconds.
11:08You cannot do that if you buy from Restaurant Depot right now.
11:11But there's a catch. Cisco requires customers to meet minimum order sizes.
11:17For a restaurant chain this big, that's not a problem.
11:20I don't even know what my minimum is anymore. I think it's 20 cases, but we never have to worry
11:25about that.
11:26But not every restaurant operates at this scale.
11:29Tight space.
11:31For smaller, independently owned restaurants like Rick's and New Jersey, those minimums can be harder to meet.
11:37Which could mean extra fees or not getting a delivery at all.
11:41So I could come in here and spend $20.
11:44But I can't just order, you know, six things from the supplier.
11:47I have to order 30 items with like a $1,200 minimum.
11:51Brenna says Cisco can adjust a small restaurant's delivery schedule to help it meet those minimums.
11:56For example, moving deliveries from once a week to every two weeks.
12:01Additionally, Cisco says it has a program for small restaurants in larger cities with no minimum requirement.
12:07The company also offers services to help restaurants order more efficiently.
12:11When I had only one restaurant, they invite me in the kitchen to help me develop menu items and show
12:16me and educate us.
12:18I didn't have to hire a consultant.
12:2032-ounce prime tomahawk.
12:22At this test kitchen in New Jersey, Cisco employs foodies to develop menus.
12:27You could use this in the same vein you would your balsamic production.
12:30Today, they're working with Kevin Gilbert, executive chef of the Cloverleaf Tavern, on ideas for fall dishes.
12:36This is a pumpkin waffle using our Cisco pumpkin puree.
12:41I'm using our Belgian waffle mix.
12:43I'm looking at the texture, the colors.
12:46I'm seeing how balanced it is.
12:48I think this is a pretty fantastic looking waffle for the fall.
12:52Butter has the flavor.
12:53Everything blends really well together.
12:55The flavors are there.
12:56The texture is awesome.
12:58While Cisco foodies help provide the foundation for these meals, Kevin still weighs in.
13:03How much do you tweak what's put in front of you by Cisco?
13:06I would adjust it a little bit just based on textures and flavors within the restaurant.
13:11And although I do like this, I want to kind of make it our own.
13:15Tasting is just one aspect of what goes on here.
13:18Before Kevin actually orders the ingredients, he says he'll sit down with Cisco to look at packaging sizes and pricing.
13:25To see whether the dishes make financial sense for the restaurant.
13:28It's part of a larger strategy at Cisco.
13:31Sell restaurants Cisco ingredients that can save prep time while still leaving room for chefs to make the final dish
13:37their own.
13:39It works this way at the Cheesecake Factory, which makes all of its dishes from scratch, but still sources ingredients
13:45from Cisco.
13:48Over at Sheena, Rick says he prefers to come up with his own recipes and find fresh ideas in the
13:53aisles of Restaurant Depot.
13:55I grabbed the short rib because I was like, OK, this is going to be something that I'm going to
13:58try to work on.
14:00It's not something we normally carry, but it's just the moment of inspiration.
14:05Cisco says the Restaurant Depot deal would give shoppers more products to choose from.
14:09If you talk to the Restaurant Depot folks, that's one of the things they're most excited about.
14:12How do we get fresh cut produce into their stores?
14:15How do we think about vacuum sealed cut steaks into their stores?
14:19Things that they don't have access to right now is something that we can bring to them.
14:22Back in his kitchen, Rick is turning that inspiration into new specials, including a bone and veal katsu.
14:28And then we're going to use the lobster bisque for our lobster dumplings.
14:33And then we're going to use our burrata for our scallion pancake dish.
14:38For Rick, Restaurant Depot gives him another option when Cisco's prices, order minimums or products don't work for his restaurant.
14:45Regulators will decide whether the deal goes through in the next few months.
14:49For restaurants like Sheena, the question is whether they'll still have the choice afterwards.
14:58When you have all these birthday parties that are like, you know, 10, 12 people and this comes out, they're
15:04going to be like, I need that.
15:05You can 100% excel to things like this without any hesitation.
15:09And we're going to get to the next one.
15:10Thanks very much for having a great day.
15:10We want to keep this in mind.
15:11We want to keep doing it.
15:11We want to keep doing it.
15:11We want to keep doing it.