Distributor pricing

The operator's guide to distributor pricing

July 24, 2026 · by the Candor team — operators auditing real restaurant invoices

Distributor pricing isn't a mystery — it's a structure, and the structure favors whoever knows their numbers. This guide explains how broadline pricing actually works, why the same case of chicken costs different amounts across town in the same week, and what leverage an independent operator really has. It's written by people who pay these invoices weekly across 8 restaurant brands.

How distributor pricing actually works

Most independent restaurants buy on some form of cost-plus pricing: the distributor's cost for an item, plus a markup. The part that matters is which kind of cost-plus you're on.

• Cost-plus-fixed — a set dollar amount per case. Large chains negotiate this. Your margin exposure is capped and predictable.
• Cost-plus-percentage — a percentage markup you usually never see itemized. This is what most independents get. When the distributor's cost rises, your markup rises with it — you pay more twice.

Volume tiers sit on top: the highest-volume accounts pay the lowest cost per case. Under roughly five units, you have little formal leverage — which is exactly why the informal leverage (data) matters so much.

Why the same case has different prices across town

Real spreads from our own restaurants' 2026 invoices and quotes in Phoenix:

Same items, same city, same week. The spread exists because each operator's price reflects their contract type, their volume tier, their rep's discretion, and how recently anyone pushed back. Here's what those spreads look like line by line — and what one of them is worth per year.

Where the margin actually leaks

Three mechanisms do most of the damage:

1. Price creep. A $2.40 case quietly becomes $2.90. Nobody re-checks it, and across 200 line items and 52 weeks the drift compounds. When industry costs spiked, distributors passed them straight through — Sysco told investors it passed along a 13.4% cost increase "with little pushback" (Restaurant Business), and US Foods reported an 11.5% quarterly price increase in its own results (The Food Institute). Why prices creep — and the words to push back.
2. Fees and surcharges. Fuel surcharges and delivery fees that appeared once and never left. Industry analysis puts typical overcharges at about 1% of each invoice's total (FSR Magazine) — small per invoice, real money per year.
3. Substitutions and pack-size changes. The item code changes, the case shrinks, the per-unit price moves — and the invoice line looks normal.

What leverage you actually have

The annual increase letter is an opening offer, not a law of nature. What changes the conversation is specificity: knowing what the same case costs elsewhere, and asking about your line items by name. That's the entire mechanism behind our audits — every finding cites an invoice line (invoice #, date, SKU), because a rep can wave off a feeling but not a number. If you want the DIY route, we compared the tools honestly — including the spreadsheet method half of r/restaurateur uses.

Your price sanity-check is being bought

Sysco signed a roughly $29B agreement to acquire Jetro/Restaurant Depot (pending close) — the cash-and-carry that hundreds of thousands of independents use as their independent price check. Whatever the deal's final shape, the direction is fewer independent reference points. An independent benchmark matters more every quarter, not less.

What to do this week

Pull your last 3 invoices. Check your top 10 items by spend against any second source you have — another distributor's quote, a cash-and-carry shelf price, another operator. If a line moved more than a few percent since last month and nothing in the market explains it, that's a conversation with your rep, by name, with the number in front of you.

Or skip the spreadsheet night: that check is literally what we do, free, in 48 hours.