AtlantaFresh Artisan Creamery, a producer of grass-fed Greek yogurt based in Norcross, is shutting its doors after nearly 10 years in business.
According to a company statement, the creamery is closing because it lost a contract with its largest client, Whole Foods Market. The statement said the popular Atlanta creamery will lay off more than 30 employees and close by mid-March.
VIDEO: More on Amazon HQ2
AtlantaFresh yogurt had been on Whole Foods’ shelves for the last eight years, but the grocer removed all AtlantaFresh products from its system last fall, shortly after Amazon acquired Whole Foods for more than $13 billion.
Messages left for AtlantaFresh CEO Ron Marks, were not immediately returned.
In a statement, Whole Foods said the company is “always excited to bring new local products to our stores and customers, but, unfortunately, not all products meet sales expectations.”
The grocer said it works with vendors to improve sales, but “despite our efforts, we are not always able to raise demand and we must occasionally make the difficult decision to discontinue products.”
The creamery’s products were popular with consumers, but a number of top Atlanta area restaurants also used AtlantaFresh’s products, and will have to find new vendors.
Star Provisions was one of AtlantaFresh’s first clients.
Star Provisions co-owner Anne Quatrano said that they primarily purchased AtlantaFresh yogurts, using the product in dishes and selling it on the shelves at Star Provisions and sister shop Little Star.
Quatrano said that she is currently looking for another yogurt supplier.
According to the statement, Whole Foods Market approached AtlantaFresh in 2015 about supplying 100 percent grass-fed, certified non-GMO milk and cream to “a significant portion of the Whole Foods Markets nationwide” that totaled 110 stores across three regions.
As part of the agreement, Whole Foods Market loaned the creamery $500,000 for expansion and signed a 7-year contract committing to purchase 30,000 gallons of milk per week. AtlantaFresh began fulfilling the contract in July 2016 but Whole Foods canceled the 7-year agreement last September after only 14 months, Marks said.
AtlantaFresh said the agreement was cancelled without cause.
“Whole Foods became our largest customer fairly early on,” Marks said in the release. “We were ecstatic about the relationship because they were very strong supporters of the local food movement and of AtlantaFresh.”
Amazon announced its deal to buy Whole Foods in June. The deal sent shock waves through the retail world and was seen as acknowledgement by the e-commerce giant that it needed physical locations to grow its empire.
Changes at Whole Foods so far have been subtle, but Amazon is known as an aggressive cost cutter, forcing vendors to squeeze their margins.
Alon’s Bakery and Market is another longtime AtlantaFresh customer. The bakery purchased milk and yogurt for its locations in Dunwoody and Morningside. Alon’s owner Alon Balshan said Marks approached him back when AtlantaFresh was still in the planning stages.
“[Marks] said, ‘I am thinking about doing a yogurt business, what do you think?’ I pushed him to go to the big guys, like Whole Foods,” said Balshan. “That tells you something about Amazon taking over. They threw this guy under the bus.”
Alon’s macarons are also among the locally made goods that Whole Foods carries at 45 of its stores in the region.
MYAJC.COM: REAL JOURNALISM. REAL LOCAL IMPACT.
AJC Business reporter J. Scott Trubey keeps you updated on the latest news about economic development and commercial real estate in metro Atlanta and beyond. You'll find more on myAJC.com, including these stories:
- Krog Street Market developer plans redo of aging Atlanta hotel
- Secrecy surrounding Amazon HQ2 bid keeps Georgians in the dark
- Renderings show planned new look of Underground Atlanta
Never miss a minute of what's happening in local business news. Subscribe to myAJC.com.