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North Bay food wholesalers, markets plan how to stay in business during prolonged power shut-offs

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Some businesses can sustain indefinitely during a power outage by moving operations and having workers telecommute.

Those who feed the food supply chain are not one of those businesses, however.

North Bay retailers, shippers and wholesalers have had to prepare and deploy emergency strategies to avoid catastrophe during the recent power outages caused when Pacific Gas & Electric cut power to thousands of customers in a move to avoid triggering wildfires.

The supply chain to get a food product from a producer to a distributor to the shelf is delicate and relies on careful timing and delivery. Even for a distributor like Mike Hudson Distributing in Petaluma, whose facility and cold storage was not affected by the PG&E power shut-offs, outages make it much harder to determine which stores need what.

“A lot of our customers are without power,” said owner and President George Parisi early last week.

During the outages, his company reached out to customers, mostly independent markets, daily to determine if they had power and could accept orders of perishable goods that need to be refrigerated.

Parisi said an added layer of complexity on top of determining which stores have the power or generators to run refrigeration units is timing deliveries, because it can take up to a day to re-cool the large areas where food is stored.

Marin, Napa, and Sonoma counties are Parisi’s main customer base, and all saw blackouts. While orders are down by about half as a result of the blackouts, Parisi expected a rush of requests for goods, now that power is back on.

But that also has a financial impact, since trucking more food means more hours and overtime for employees.

“It’s going to be more of a situation where they’ll be short time this week and they’ll be working a ton of overtime trying to make up for it,” Parisi said of his employees.

A business like Mike Hudson needs drivers to run its operations. Parisi said the Kincade Fire, which burned nearly 78,000 acres and at the maximum caused almost 190,000 people to evacuate in northern Sonoma County, resulted in some of his drivers being evacuated from their homes and unable to work. Those orders were lifted in the latter half of last week.

“It hurts us most when a driver gets evacuated,” he said. “We don’t have a lot of backup for them.”

Even for grocery stores like Sunshine Foods in St. Helena that were not affected by the Napa County power shut-offs, the costs of ensuring continued refrigeration are significant, according to store General Manager Mark Smith.

The store rented a generator after initial power cuts weeks ago and switched over to generator power the last Friday in October to ensure there were no interruptions in the power supply.

“We were able to run pretty much full capacity,” Smith said, although he noted the store’s internet connection was out, which meant it could not process debit and credit card transactions.

“We are researching how to take credit cards in the future” while on generator power, Smith said. “We’re going to be switching over to a new router that has cellular capability, so we have a second chance at maintaining internet.”

Smith said knowing about power outages ahead of time gave him the chance to stock up on essentials like water and to make more coffee and breakfast items to hand out to affected people who come to the store.

While his store largely got through the most recent round of outages unscathed, Smith said a long-term outage would likely result in losing 90% of his perishable goods. There are a few businesses with refrigerated trucks in the area that could potentially store some of his products.

“We really don’t have any resource past that,” he said.

Though Sunshine Foods did not lose power, Smith said the preparatory costs and the cost of running the generator as a precaution are a major expense.

“It’s the rental of the generator, the gas to power it, the equipment we had to buy to be able to switch over,” Smith said.

Still, it’s better than the alternative.

“We’d rather try to be able to be open here,” he said.

The first morning of the outages, Smith said his store was one of the few still open in the area and welcomed people with free breakfast and coffee.

“It helps morale massively,” he said.

Back at Mike Hudson in Petaluma, Parisi has considered the worst-case scenario of losing power at that location for a long period of time.

“Our biggest plan would be to probably move everything onto our trailers,” he said, referring to the refrigerated truck trailers the company uses to move food.

Sealing cold-storage areas could keep food at the right temperature for up to two days even without power. That would mean stopping deliveries and grinding business to a halt, however, if the power is cut at some point in the future.

“We aren’t going to be delivering anywhere,” Parisi said of that scenario.

Staff Writer Chase DiFeliciantonio covers technology, banking, law, accounting, and the cannabis industry. Reach him at chase.d@busjrnl.com or 707-521-4257.

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