Nicho Produce

A family venture in fresh produce distribution since 1969
Written by: 
Tom Faunce
Produced by: 
Elizabeth Towne

In 1969 Dionicio “Nicho” Villarreal founded Nicho Produce in Edinburgh, Texas. Since its inception, the company has been a full-line wholesaler and distributor of produce throughout southern Texas. A family business, Nicho Produce has involved all members at the Villarreal family. Tommy Villarreal, Nicho’s son is currently the company president. “I grew up helping with the business, even when I was very little,” says Villarreal. “I learned how to count to 12 by packing lemons in bags.

Starting with a fleet of only three bobtail trucks, Nicho Produce initially focused on servicing independent supermarkets as well as providing international distribution into Mexico. The company continued to grow and expansion of facilities became necessary. In 1992 the team added an additional two cold rooms and three rooms for banana ripening.

As a medium-sized company, Nicho Produce employs 55 people and serves more than 250 accounts out of its Edinburgh warehouse. The company also ships its own product with its fleet of more than 30 trucks, which the company services itself out of its own mechanic shop.

Adapting to change in the market

With the increase in Big-box retailers, and the inability to compete with prices, the amount of independent supermarkets has been in decline. Nicho Produce has adapted to the change in the market by targeting schools. “We now bid on contracts with schools throughout the state,” Villarreal explains.’ “As more and more schools are being built that portion of our business continues to grow.”

 The market had grown enough for Nicho Produce to open a “Fresh Cuts” sector of the company in 2005, which produces customized salads. This department is the only salad processing center in the Rio Grande Valley that is Hazard Analysis and Critical Control Point (HACCP) certified

Despite the decline in independent supermarkets, Nicho Produce still acts as a secondary supplier to major retailer outlets for short-term items. The company also serves the hospitality and health care sectors. “We even sell to a lot of other wholesalers,” says Villarreal.

Customization is a strong aspect of Nicho Produce which provides a competitive edge to the company, “There are a lot of people now that want things a certain way,” says Villarreal. “A major strength of ours is the ability to meet those needs and customize things for our clients.”

The increase of regulations in the produce industry every year can create obstacles for companies and have a direct impact on the bottom line. “Every year it becomes more expensive to do business,” says Villarreal. “We realize though that most of that is for the good of the industry.” Nicho Produce has adapted to the legislation by upgrading its warehouse and equipment. “We have made a lot of improvements here. I like to say we have an old, new warehouse. We’ve been here since 1969 but have done a tremendous amount of remodeling to bring the place up to spec.”

A strong team

In a competitive industry such as produce distribution, Villarreal is thankful for his team of employees past and present. Strong employee retention creates customer retention, and Nicho Produce has its share of loyal employees. “We’ve been blessed to have some longtime key people here,” says Villarreal. “In the past two years we’ve had 2 people retire. One gentleman had been here since 1970.”

The reputation and relationships that Nicho Produce has established in its more than 40 years in business have created an ample amount of customer loyalty, which Villarreal does not take for granted. “Loyalty is not something that is given, you have to work to keep your customers,” Villarreal explains.” In order to retain customers as well as gain new accounts, Nicho Produce has become skilled at adapting to changes in the industry. “The industry is going toward smaller, prepackaged items especially in the schools that we serve. Individual-sized servings are becoming more and more popular so we’re following that trend.”

Villarreal measures the success of Nicho Produce by the level of customer satisfaction his company produces. “If you’re dealing with complaints all day then things are not going well,” says Villarreal. “On the contrary, if you’re dealing with repeat orders all day then you know you’re doing something right.”

“We have some expansion plans in place,” Villarreal explains. “We are going increase the size of our banana ripening and processing rooms, as well as the amount of cold storage in general.” With several consecutive years of increased sales, Nicho Produce is looking at significant growth in the near future.

Strategic Partnership(s): 
The Salad Farm