CALLICOON, NY — One employee-owned business is buying another: The four Peck’s Markets in Sullivan County are to be sold to PSK Supermarkets, according to a contract.

“In 2023, we took a vote among employees to see if they were interested in selling the company, which they were,” said Lee Reimer, who runs the four stores with his team of more than 200 employees. Arthur Peck founded the first Peck’s Market in the 1970s in Narrowsburg; the company became employee-owned in 1983 and expanded over the years to include locations in Callicoon, Jeffersonville, Livingston Manor and Eldred. (The Narrowsburg store was sold many years ago and is not part of the Peck’s Market group.)

“We wanted to make sure we only considered a company as a seller if it offered our employees a good work environment with growth opportunities for the teams,” Reimer said. “We didn’t want to sell to a large chain because we were afraid they wouldn’t care about our employees or the communities like we do.”

The transition will take place after Labor Day.

PSK Supermarkets is also a family-owned business. Founder Paul Katz started with a fruit stand in the Bronx in the 1940s. By 1956, he had saved enough money to buy his first grocery store on 204th Street. His son Sydney, who often delivered orders on his bicycle as a child, joined his father in 1962. The father-son team grew the company to seven grocery stores over the years.

In 1987, Sydney’s sons Daniel and Noah joined the business and the family began opening large supermarkets throughout New York City and upstate New York. Today, they operate 14 supermarkets from Brooklyn to Harlem to Dutchess and Columbia County. The stores operate under the names Foodtown, Freshtown and Pathmark.

Noah Katz said that in 2020, after seeing how hard their employees worked to keep shelves stocked and serve customers, he and Daniel decided to make the company employee-owned through an employee stock ownership plan (ESOP).

Today, Noah is President and CEO of PSK. He provides further details below:

What will happen to Peck’s employees?

PSK has offered every Peck’s employee their job with equal pay and benefits. The Peck’s Market name will not change.

How did PSK become interested in Peck’s?

Last winter, Peck’s approached Noah Katz and it turned out to be a perfect match. In fact, all of Peck’s employees voted unanimously to sell to PSK. Not a single employee voted against it.

How do shareholders share in the profits?

Employees of ESOPs receive an allocation of company stock each year. They accumulate the shares and redeem them for cash value upon retirement.

Noah said, “We have always attributed the success of our company to the hard work of our employees. They are great people. That’s why the ESOP works so well. Employees have an ownership stake in the success of their hard work.”

It is extremely rare for one employee company to buy another employee company. Employees who own stock at Peck’s receive the proceeds from the sale for their years of hard work. Then they can start over at PSK. The longer employees stay at PSK, the more stock they can acquire over the course of their careers at the larger company.

Do the employees agree with the change?

Peck’s employees are very excited about this transition. Jeff Gombita, who has worked in the stores since he was a teenager, said, “All employees are excited about this great opportunity for everyone. The sale of the company will benefit Peck’s employees for all our hard work over the years, and we get to be part of a great new, larger company that operates with the same family-run values ​​that we do.”

“Customers will also benefit because the prices will be more aggressive at the larger company. We are very happy that PSK is keeping all its employees in the new company. That was very important to us.”

What impact does the change have on prices, service and products?

Lee Reimer and Noah Katz have identified a motto for the transition: “Keep everything running.”

“We’re going to start cutting a lot of prices because we have a lower cost structure at Allegiance Coop,” Noah said. “We’re also going to have a very aggressive weekly sale that we’re doing in all of our stores.”

PSK is part of a large purchasing cooperative called Allegiance Retail Services. The 135 member stores can buy groceries at the same prices as all the major chains.

“This will allow us to pass the savings on to our customers and compete with all the major chains in the region,” Katz said. “Peck’s customers will save money after the switch thanks to our lower cost and price strategy.”

Will PSK retain local suppliers?

PSK will also retain all local vendors. PSK, like Peck’s, is a very charitable company. PSK will continue all charitable relationships and donations in the communities of Peck’s stores. They already do this in their other stores.

Once the stores have been converted and employees have become familiar with some of the new systems, a transformation plan will be developed starting next year.

In the PSK stores, delicatessens, bakeries, produce departments, butcher shops and much more have been completely redesigned. The Peck’s stores will now receive these modernizations.

PSK also offers the Fresh Points program: With their club card, shoppers earn 10 points per dollar for every order. The points are added up and the total points are always shown on the receipt. Shoppers can then redeem their points for free and discounted groceries. For example, PSK has shoppers who have never paid for milk or eggs because some shoppers use their points to do that. Points can also be used for free gas for your car, gift cards and groceries.

Katz said, “We are thrilled to be working with the Peck staff and serving these wonderful communities. We thank everyone who has given us the opportunity to serve you, and we look forward to being a part of this community for decades to come.”