Better Wholesaling Insight - June 2021 by BetterRetailing

June 2021

In-depth analysis, insight and advice for convenience and foodservice wholesalers

Technology Take advantage of transformational trends in wholesale

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CONTENTS

REPORT P4: Introduction The benefits of moving to a digital framework

LEADER

P6-7: Gilroy viewpoint Why wholesalers need to skill up their workforce on digital

The world is transforming and the wholesale industry must follow suit

Paul Hill Editor

ot an hour goes by when we’re not using some form of technology in order to help us in our daily life. Whether it’s the self-scan checkouts in a shop or using a mobile phone to order a takeaway, technology has gradually consumed us and 99% of the UK population couldn’t live without it. The wholesale industry, however, has not traditionally been the fastest to pick up on the latest transformational trends. That was until the Covid-19 pandemic hit, and we then saw a wave of wholesalers embrace technology as

EDITORIAL

Printed by Acorn Web Offset Director of sales & marketing Ltd, Loscoe Close, Normanton Industrial Estate, Normanton, Matthew Oliver West Yorkshire, WF6 1TW 020 7689 3367 Distributor Seymour Distribution, Senior account director 2 East Poultry Avenue, London, Charlotte Jesson EC1A 9PT 020 7689 3389 SALES

Editor Paul Hill Editor in chief (maternity cover) Tan Parsons Head of design Anne-Claire Pickard Production editor Ryan Cooper Sub editors Jim Findlay, Robin Jarossi Designer Jody Cooke Production coordinator Nadeem Masood Contributors David Gilroy, Tom Gockelen-Kozlowski, Toby Hill, Rob Mannion, Charles Smith

Account director Natalie Reeve 020 7689 3372

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Newtrade Media Limited, 11 Angel Gate, City Road, London EC1V 2SD Tel 020 7689 0600

Account manager Adelice Tatham 020 7689 3366 Account manager (new business) Jimli Barua 020 7689 3364

Better Wholesaling Insight's publisher Newtrade Media cares about the environment.

they looked to take their product base online and interact with their customers at home. The result has led to some of the biggest changes ever seen in the channel, with the industry now unrecognisable from where it was at the start of 2020. This doesn’t mean the work is done. As well as the huge number of wholesalers still yet to embrace e-commerce, the industry needs to keep evolving to preserve its long-term future and fight off threats from the likes of Amazon. In this report you’ll find all you need to know on wholesale technologies and what they can do for your business. Among the topics we cover in this issue are international e-commerce and how a UK wholesaler can offer it, how to promote digital adoption within a client base, as well as information on how to skill up a wholesale work force for this new world. With life gradually returning to normal, I now plan to visit a number of wholesalers throughout the rest of the year. Please get in touch if you would be interested in welcoming Better Wholesaling Insight to your facility.

Better Wholesaling Insight is published by Newtrade Media Limited, which is wholly owned by NFRN Holdings Ltd, which is wholly owned by the Benefits Fund of the National Federation of Retail Newsagents. Reproduction or transmission in part or whole of any item from Better Wholesaling may only be undertaken with the prior written agreement of the Editor. Contributions are welcomed and are included in part or whole at the sole discretion of the editor. Newtrade Media Limited accepts no responsibility for submitted material. Every possible care is taken to ensure the accuracy of information.

P8-11: Case studies Technological learnings from across the industry P12-13: Data & insight How to succeed in B2B e-commerce P14: SWA viewpoint How Scottish wholesale has embraced technology P16-17: Data & insight KAM Media’s findings shows the benefits of digital investment P18-19: Data & insight How to promote digital adoption to your customer base P20-21: Data & insight TWC analyses the habits of online consumers P22-23: Data & insight Looking into the details of international e-commerce P24: Data & insight Five key pieces of advice for online wholesale P25-26: Tips & summary Seven reasons why wholesalers should embrace change CATEGORY ADVICE P28-29: Working Together Project Why Parfetts and Alpro are a success in the plant-based category P30-31: Working Together Project SBF GB&I and Lioncroft Wholesale discuss their profitable partnership P32-36: Sector review An in-depth overview of the PMPs category P37: Industry spotlight What is KP Snacks up to in the wholesale world? P38: Industry spotlight Finding out all the latest news at Imperial Tobacco P40-44: Sector review A deep exploration of the tobacco and vaping sector 17/06/2021 11:27

STOCK UP

HERE

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REPORT

Introduction Paul Hill

he wholesale channel will hopefully never again have to experience what it has been through these past 18 months. However, if there is one shining light to come from the Covid-19-related lockdown in the UK, it’s the adoption of new technologies in the channel. These new frameworks will not only make wholesalers’ operations run more smoothly and profitably in the short-term, but they will help preserve the industry’s long-term future. This report will help arm wholesalers with everything they need to know about the latest technologies, as well as offering insight from all the key players, as they discuss how it has helped transformed their business and the industry. But if you’re a wholesaler reading this and are still not fully set up for digital, here is a short list of benefits that will help change your mind, with further details throughout this report: • It makes it easier to manage your workforce • You can tailor specific offerings on customer accounts • It helps limit personal contact in the post-pandemic world • It aids the exploration of new markets at home and abroad • It places the depot in your customers’ pockets • It allows the adoption of digital promotion • It saves on man power in depot • It helps your business become more sustainable

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Better and stronger together Unitas Wholesale is the UK’s largest wholesale services company working with our supplier partners to negotiate the very best terms on behalf of our 165 member wholesalers

As your first choice business partner we harness the collective scale and strength of our membership to negotiate the most competitive terms for our members and their customers. We deliver outstanding service, powerful promotions and an award winning own brand. Through efficiency and effectiveness we support our members in saving more and selling more. If you share the same values and believe you would benefit from becoming part of the Unitas family, contact us today on T: 01302 249909 or visit www.unitaswholesale.co.uk for more information

Retail

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Foodservice

On trade

Specialist

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REPORT Gilroy’s Viewpoint: The time is now for wholesalers to skill up in the art and science of digital

David Gilroy is the founder and managing director of Store Excel

he importance of digital trading is fast becoming recognised across the industry, but a digital strategy requires a specific set of skills that may not reside in the current wholesale teams. In this issue of Better Wholesaling Insight you will read a lot about the importance of digital and the opportunities it offers, but maybe not so much about the ‘who’ and the ‘how’. Realistically, how many wholesale organisations have the skills and resources to implement an effective digital strategy? After World War Two, times were tough for many and my father took two jobs. He was a civil service administrator by day and a switchboard operator by night. Neither job exists any longer. Nor do lamplighters, linotype operators, railway signalmen or badgers. The list of jobs wiped out by technology is as endless as it is fascinating. The same is true for our industry. We no longer employ people to pat butter, pluck turkeys or wire cheese. When I started out with Sainsbury’s, I was lucky to secure a comprehensive development programme to learn the essential retail trade skills: bacon boning, butchery and provisions – fresh

food to you and me. These skills might have stood me in good stead throughout my career – but they didn’t. Within a few years, all that learning had become largely irrelevant. I had to master a new set of computer-based skills. If you work for 40 years, for example, you will definitely have to acquire new skills in the ferment of technological and social changes. What about checkout operators and shelf stackers in the not too distant future? Old jobs die out and new jobs come to the fore. Wholesalers looking to increase sales deploy skills honed and perfected over many years. Merchandising techniques: bulk displays, rack ends, impulse breakouts and point-of-sale advertising. Supported by mailed brochures, flyers and possibly in-store demonstrations and car selling. Although these skills are relevant and effective, they are ‘old world’ skills. Today, most cash and carries deliver orders requiring a suite of new additional skills such as outbound calling, order processing, picking efficiency, route planning and vehicle management. Operations management has found this to be a tough challenge. And just like the supermarkets, cashand-carry operators have found it difficult to deliver from premises originally designed for customers self-selecting and semi-adapted to the needs of a delivered operation. These are old-world skills adapted through necessity. When the band Queen needed an instrumental break in the song ‘I Want To Break Free’, they hired electronica specialist Fred Mandel to play the synth. They knew that their rock-based skills weren’t up to getting the sound they wanted. They needed Fred’s skills. Similarly, digital in wholesaling requires new skills, dedication and a committed resource. To be real in digital, wholesalers must skill up.

Digital in wholesaling requires new skills, dedication and a committed resource

Clean data Wholesalers have held customer data for years – information that multiple retailers would kill for. But let’s be honest. How many have used it effectively and in what shape is it? If the data isn’t clean, accurate and continually refreshed, it will impede effective marketing and business analysis. Are the basic details correct? Name, address, email addresses, landline and mobile numbers, business names. How many duplications are on the file and who follows up the bounce-backs? Does the registration process capture the correct details the business needs? And how much care and attention is paid to the accuracy of registration? Is the data organised correctly: customer types and segmentation, definitions of ‘active’, ‘lapsed’ and ‘lost’ customers? In the digital world, you are going nowhere if the data isn’t reliable. Data has to be at the front and centre of the operation. Customer-user experience A lot of care and attention goes into depot-floor layouts and merchandising. The same should apply to web-

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and deploy a campaign is hours rather than weeks. This enables fast reaction times for sporting events, news updates, weather conditions and public holidays. The nature of web and particularly app marketing enables product delivery direct to a mobile device supported by a short video clip or in a contextual setting through augmented reality. The customer relationship can feel individual and special.

sites and apps. Research by Summit shows that customers now expect their service provider’s e-commerce offering to be fully flexible across both the website and the app. They may start an order on one device, save it and go back to it on another device. The days of spending thousands on a website or an app and taking months to launch are over. A progressive web app (PWA) platform that gets both working in tandem is now the best approach, offering a low-cost and highly effective solution. Users expect superfast page loading, simple registration, reliable log-in, high-grade product categorisation and excellent search facility and filtering. And they expect accuracy with clear and relevant images. Inventory offered with clarity and ease of use is just the baseline standard before traffic enhancers such as key words, sales triggers and impulse-purchase signals are added. Customer reviews are becoming increasingly influential with peers and they provide a useful (if sometimes painful) insight into the perception of the proposition. Online and app is such a critical route to mar-

ket that it requires constant attention by dedicated and skilled operatives. Electronic marketing It’s your data they want, stupid. But why? My bank continually tells me how much they value our relationship. Really? They only reach out to me around March time each year to sell me ISA packages. Take my data, but give me something I really want in return. The same applies to wholesale. Electronic marketing offers so much more than physical brochures. The key differences are targeting, relevance and speed. The capability to get the right offering or message to the right customer at the right time. By segmenting the customer database it is possible to target the big spenders, the low spenders, the lapsed customers, the lost customers and those buying on limited categories. Each class of customer should be messaged with appropriate content, with products and categories selected and incentivised by marketing in a similar way. I may wish to reward my loyal customers or I may wish to reactivate those who lapsed. Two very different approaches. The time taken to plan

Data analytics I am looking at the electronic dashboard and I can see the entire business performance in full view: which customer devices are most favoured, which delivery methods are preferred, order frequencies, transaction values, year on year, month on month, trending up or down. I can see my top-spending customers, my most profitable customers, those that have increased their spending frequency and those who have stopped altogether. I can see the impact of my various marketing campaigns in terms of product and sales uplifts and impacts on profitability. I can see which marketing outputs, promotions or products responded best on particular days or certain times during days. I can share this information with my supply partners. I am able to assess the performance of my website and app through user time spent on the pages, page impressions and bounces. Anyone who has spent time looking at Google Analytics can’t fail to be impressed by the wealth of pertinent information it affords. It is well worth booking a Google training session to develop deeper analytical skills. All of the above offer brilliant insights hitherto not available in the ‘old world’ into how best to hone and adjust the customer offering. Of course, the trick is to pick out the most relevant for the best use of time and this is where having skilled people is so vital. In summary, imagine your business is ‘dark’ and the only means to trade is electronic. It is not just a nice-tohave add-on. It is now an essential capability requiring new skillsets. Full immersion and ownership has to be the approach. l

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REPORT

Lessons from the industry Wholesale leaders from across the channel give their take on the influence technology has had on their operations

NEW

Paul Hill

330ML CAN

Dawood Pervez Managing director, Bestway Wholesale

At Bestway, over the past year we have invested and improved across the breath of the business in regards to technology. We are the market leader in digital developments including being the first in the industry to introduce our bespoke apps and continue to invest and drive digital developments. We most recently entered a partnership with Jisp and, with regard to our customer data, we are now using tools such as Content Square, and have a new online tool, Digital Toolbox, which we have developed in partnership with Red Bull, which is designed to help our retailers grow their category sales with insight, personalised planograms, store walkthroughs and a fair-share calculator.

Kiera Campbell Sales director, Henderson Foodservice

At Henderson Foodservice we developed a completely new customer-friendly e-commerce platform in October 2020, and the impact has been incredible. The new site harnesses detailed information on thousands of products in the Akeneo product information management (PIM) system and has generated more than £14m in sales online for us since its launch. During the pandemic, more customers than ever were choosing to buy with us online, and we needed to capitalise on that trend by making our digital platform more flexible. We’ve experienced a record number of online users and page views each month, as well as increased sales. It’s been a real game-changer, and its success was recognised recently when the company won a leadership award from global PXM solutions provider Akeneo at its Unlock 2021 summit.

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Chris Binge Chief executive, Fairway Foodservice

Fairway Connect is a comprehensive cloud-based communication system with commercial and marketing information passed between suppliers and Fairway wholesalers with Fairway head office as the gatekeeper. Suppliers can make product changes to their product ranges available to Fairway members. Here they can add products by importing from Erudus, or manually. It also offers the option to delete products, change cost prices and offer promotions that trigger an alert for buyers to accept, reject or start a negotiation, and once agreed, the system produces a weekly report of all agreed changes and effective dates for members. Members’ systems auto-upload weekly sales data and shortage reports to the system for HO analysis. We currently add product complaints manually, but this will be automated in future. TROPICAL FLAVOURS ARE

GROWING

+22%

Justin Birchall

Tim Adams

Managing director, Birchall Foodservice

Director of marketing and corporate sales, Bidfood

In the past five years, our business has made huge changes from a technology perspective. These include introducing new routing software to help us plan our vehicles’ journeys more effectively, and the introduction of digital e-requests for our buying and purchasing ledger procedures, which reduce manual intervention and ultimately save us time. Perhaps our biggest technological change has been the development of our own purpose-built e-commerce platform for caterers: OrderMate. This project has been four years in the making and was fully launched in April. OrderMate not only allows customers to order online, manage their menus and save lists for catering event, but it also lets them view live allergen and nutritional information through our collaboration with Erudus.

Technology has been a movable feast across foodservice and hospitality for some time, but when the pandemic hit, it really did fasttrack a lot of this change, as we all became so heavily reliant upon it. Tech trends across the industry are incredibly varied, from food tech trends such as data and traceability, through to hospitality tech trends that focus more around the customer experience, be that contactless payment, online table reservations or delivery apps. However, the areas of technological change that are very much paving the way for us as a business are currently order stock management platforms, allergen recipe and menu management systems – which are evolving to align with impending legislation – as well as exploring areas of growing interest such as traceability and blockchain.

Gary Mullineux Managing director, Caterforce

In 2020, we made a conscious decision to invest more in technology and make better use of data, with a view to gaining an in-depth understanding of our customer base. We have been working on three technology projects. The first is the Caterforce Sales Hub, which launched in April 2021 and has been very well received by suppliers and members. The second is a PIM system to provide members with high-quality imagery and enriched product information for their e-commerce platforms. The third is an online database that manages commercial data and provides automated reporting. In addition to these tech projects, we are embracing new ways to reach our customers, such as digital marketing campaigns.

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REPORT Mike Morgan Managing director, Savona Foodservice

Two years ago, Savona embarked upon a strategic programme of system replacements that will provide the latest technology, enabling a radical improvement to its customer proposition and experience. From adopting a unified communications approach to what would otherwise be traditional telephony, to full adoption of mobile collaboration using Microsoft Teams, no technological stone has been left unturned to offer the most flexible approach to new ways of working. Following the incredible adoption of its online platform in 2019, Savona has completely replaced its core ERP system, moving to a browser-based system called Qnetex by wholesale IT specialists CSD. This already includes ePOD and live customer order tracking. Underpinning all this is the ability to retrieve and analyse data, for which Savona has adopted Phocas – a UK-based, wholly provider-owned product that offers the most user-friendly interface.

CMY

James Bielby

Steve Whitwam

Ashton Marriott

Chief executive, The FWD

Commercial director, Harvest

Head of marketing, Cotswold Fayre

After the events of 2020, adopting a digital platform isn’t a choice any more – it’s a necessity for wholesalers when trade customers increasingly expect the same ease of ordering they get as consumers. We’ve seen so many new competitors looking to move into the space, particularly in last-mile delivery. They are technology-led, but don’t have anything like the logistical skill and experience of established wholesalers – yet. Many of the development costs that have put wholesalers off investing in digital in the past have been reduced by off-the-shelf solutions targeted specifically at the channel, so it’s a lot easier to get in the game now. However, there’s still a considerable investment to be made in acquiring the new skills needed and in making sure your online ordering platform doesn’t clash with existing sales structures.

Harvest always had ideas to develop technology within the business and we recognised that our customer-facing platforms were a little out of date. Although this was something we knew needed to be addressed, the pandemic brought our agenda forward as the world developed to be online. Along with our two e-commerce platforms came two new websites, bringing our online presence into the modern age by showing great content targeted individually either to B2C or B2B via a bespoke site along with bespoke social media platforms for ‘Harvest to Home’ and ‘Harvest Chef’. Our plans for the future include developing more technology in our back-of-house operation including developing our WMS and looking at systems of picking similar to what’s used in retail home delivery that we plan to roll out over the next two years.

When looking for a new warehouse management system, we quickly realised the potential of technology to alleviate admin-heavy tasks. Since our e-commerce integration some seven years ago, we’ve seen online orders increase from 5% to 48% – and during this time, there has been a continued shift towards digital and convenience. It hasn’t been without a few hiccups along the way, overcoming issues to meet our complex bespoke functionalities, like our multi-basket checkout, but the development pains are quickly forgotten when the solution is refined. We also recently announced a long-term partnership with Ramsden International, expanding opportunities for our suppliers into new markets. As soon as an order is loaded on to the Ramsden International system, it electronically transfers to the Cotswold Fayre system.

Justin Slawson

David Lunt

Joint managing director, Mevalco

Managing director, NBC

At Mevalco, we fully recognise the value of technology and insight that it can give us. As a relative newcomer, there is a balance between cost and gain, and we have prioritised investment into this area in the knowledge that it will give us future advantage. We have made this investment despite the pandemic and the impact of Covid-19 on our business. Over the past year we have increased the use of route planning trackers which has improved the efficiency of our deliveries. By being able to find the most direct route for our deliveries across Bristol, London and the rest of the UK, it is also helping us reduce our carbon footprint adding advantage and weight to our sustainability policies.

We have two technology platforms that facilitate data for both NBC and NDN. First, Xero provides full accounting facility for revenue and costs, providing full visibility of ongoing transactions and cashflow management. Without this, the complexity of dealing with suppliers, SKUs and customers would be an administrative nightmare. Second, Unleashed’s software provides NDC with a full sales order, purchase order and stock management facility with full visibility of ongoing sales to customers, purchase orders for supplier partners and stock status in our warehouse facility. This platform also enables us to route orders through our central warehouse facility or facilitate a transfer order directly with a supplier.

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Natalie Campbell Online manager, Parfetts

Parfetts has taken some big steps forward to give our retailers the support they need to operate flexibly and efficiently. Our digital ordering site now allows orders up until midnight for next-day delivery. With our expanding delivered area, some of our customers may never set foot into one of our depots. The Parfetts website is now dynamic and features retailers’ current promotions, finish dates, savings and POR. It also displays stock figures to shows retailers current stock available and offers an alternative should there be any products out of stock. A resource library provides access to PoS and key information. We will also be launching our new app soon.

We have wholesalers who have cut their fixed costs by up to 50%

Tom Gittins Mark Lythe Joint managing director, Pricecheck

Quite simply, technology is driving change and will remain a key part of our future growth plans. As a delivered wholesaler, our biggest customer demand over recent years has been convenience. As such, we continue to invest in technology to ensure that working with Pricecheck is as convenient as possible. One of the most recent investments to facilitate this was the launch of our new B2B e-commerce website, which allows customers across the world to access live product information and place orders when it’s convenient to them. Another recent advancement has included an investment in our state-of-the-art WMS system, which improves stock management, order fulfilment and efficiencies across our two sites.

Managing director, Confex

Confex wholesalers remain focused on integrating technology into their businesses. Driving business efficiencies, cost savings, environmental gains and sales growth are just some of the benefits that will flow from investing into technology. A smaller wholesaler can make massive gains through adopting new technologies in their business as integration can be cheaper to implement pro rata versus a larger operation with higher operational and implementation costs. We have wholesalers who have cut their fixed costs by up to 50% by implementing technological advances across various projects. l

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REPORT

How to succeed in B2B wholesale e-commerce Rob Mannion is the founder of b2b.store

he digital revolution is changing the way we do business in wholesale. Where depot visits and printed marketing literature were the mainstay of the sales process for decades, digital ordering channels and promotions have become increasingly common, with big names such as Bestway leading the charge. Changes afoot in the wholesale landscape meant e-commerce was already making its mark before the Covid-19 pandemic arrived, but with digital increasingly delivering both greater total sales and higher basket values than traditional sales channels, e-commerce has become a consistent growth area in the sector. The benefits to both customers and wholesalers of e-commerce are clear: making depots more accessible to a new generation

of buyer who is used to ordering goods and services online at a time and place to suit them; reducing costs associated with data input errors; freeing telesales staff to take on other roles, and improving the personalisation of communications with customers are just a handful of its advantages. Add to this the role e-commerce has played enabling wholesalers to adapt their businesses to offer click & collect and delivery services during the Covid-19 pandemic, and it is clear that the adoption of digital wholesaling is here to stay. Just a few years ago, creating an e-commerce offer was a complex and costly process.

First you had to decide whether you wanted to create a website, a mobile-optimised website or a mobile ordering app, and whether you wanted to create an app for iPhone, Android or Windows phones. That often meant appointing separate website and app developers for different parts of the project and paying for two or three separate versions of each digital platform to be created, hosted and maintained. Then you had to make sure these digital stores could speak to each other and integrate with your existing back-office IT, stock control and payment systems, all of which added time and cost to the process. Once the systems were designed, you still had to collate all your product data, images, price information and customer data before going live, and that’s before thinking about communications, promotions and other commercial considerations. Thankfully, today, getting your whole-

sale business online is a more streamlined process – it still takes time to get product files, price lists and images in order, but, once the data is collated, your offer can go live in a matter of days. What functionality would you like to offer your customers? Firstly, map out what your ideal e-commerce offer would look like. Do you want a basic online ordering facility or would you like to offer your customers a wider range of services, for example basket builder features, barcode scanners, multi-currency payments, product data, individualised customer pricing, collection/ delivery services or the ability to create virtual trade events? Taking a little time to think things through means you can plan your budgets and flex your e-commerce to reflect evolving customer requirements. Choosing the right digital partner Choosing the right digital partner is key to getting your e-commerce offer right, both for you and your customers. Are you looking for a digital partner that will simply set up your e-commerce platform and leave you to manage it, or one that will offer advice and ongoing support to make sure your offer remains up to date? Either way, it’s important that your digital partner understands the different challenges and customer requirements of operating

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in B2B (as opposed to B2C) markets, as well as issues that are specific to the wholesale sector (e.g. grocery vs foodservice; food vs trade distribution). The latter is invaluable when it comes to designing e-commerce platforms that speak your customers’ language and add real value, boosting sales and aiding customer retention. At b2b.store, we are continually listening to customer feedback to identify areas for functional and ‘value-adding’ improvements, rolling out monthly updates that add greater functionality and make wholesalers’ – and their customers’ – lives easier. Other issues to consider include making sure your e-commerce partner’s software automatically integrates with existing backoffice systems, whether their platforms allow you to communicate directly with customers through push notifications, and how you can use your e-commerce platform to run tailored product promotions or create alternative revenue streams. Taking the time to ask the right questions at the outset can save a lot of time and money over the longer term, allowing you to create digital channels that evolve with your customers and don’t have to be rebuilt each time they do. Pricing structure It’s true that setting up and maintaining an e-commerce capability requires a certain investment of time and/or money. Advances in technology mean that we are now able to offer a freemium service that allows wholesalers to create a fully-branded ordering website and mobile app in a matter of days from receipt of product files, completely free of charge. This allows wholesalers to get online quickly and efficiently, then build their offer from there by adding (or removing) a variety of premium features as and when they need to. This flexible approach also

means you can trial certain features, keep those that work for your business and remove others to reallocate resources elsewhere as required, with no nasty financial surprises. Gathering data Once you’ve chosen your digital partner, it’s time to get your data in order. From product information and pricing to images and customer data, it can take time to get everything together, but, once uploaded, it’s easy to maintain and update. Some e-commerce partners offer free onboarding services to help with this process, getting you online more quickly than would otherwise be possible, while there are services you can subscribe to, such as Erudus, that help make sure your product data is always up to date. Know your customer Knowing your customer is key to success in any business and e-commerce is no different. We’re all used to segmenting our customers and creating specific campaigns to appeal to different audiences, but this can be taken to a whole new level using e-commerce platforms. Customer data allows you to analyse buying behaviours – from a customer’s favoured time of day to order to typical quantities and popular product lines. All this data can be used to inform promotions and customer communications, optimising their impact to encouraging larger basket sizes while strengthening the customer/wholesaler relationship. Even better? With e-commerce, you can effectively set your target audience to a demographic of one, truly tailoring your service to meet each customer’s expectations. Driving downloads So, now you’ve got your shiny new e-commerce platform, what can you do to encourage customers to take advantage of it? First, make sure you tell them about it. You’d be surprised how

many times we hear about companies who’ve launched e-commerce offers but forgot to tell their customers they existed. While the old adage ‘build it and they will come’ is true to some extent, your customers need to know your e-commerce offer is there if they’re going to use it. Some customers will be keen to get online, others will need a little more encouragement. Make sure you create ‘how to’ guides to walk less-digitally-savvy customers through the digital ordering process, including how to register their account or download an app. Spell out the benefits to them, offer incentives for first orders and so on. Taking a little time to help your customers through the onboarding process is an investment that pays dividends down the line

as they experience first-hand the benefits that e-commerce can offer in terms of value and convenience. Finally, it’s accepted wisdom in the marketing world that customers typically need to hear about a product or service at least seven times before they are willing to give it a go. So, make sure you make information about your e-commerce offer available in depot, include it in a prominent position on your website and social media channels, provide information in e-bulletins and print mailings, and run special events. Smart investment in e-commerce technologies can offer significant returns for your business. The trick is to know what good e-commerce looks like and work with a partner who can help you stay ahead of the game. l

For more information from b2b.store (formerly known as RNF), go to b2b.store 13

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REPORT The SWA looks back at the technological advances its members have made in the past year and what it is doing to support them moving forward Paul Hill

echnology has been critical to Scottish wholesalers over the past year, allowing the Scottish Wholesale Association’s (SWA) members to change tack and adapt into new areas. This has included switching from foodservice to retail as well as connecting remotely with customers and suppliers. While a huge amount of focus in technology is on how it’s used to capture user and consumer data, SWA is focusing on technological advancements it claims will be be

“tomorrow’s future”. Technology that will probably become part of the next data revolution. Wholesalers, like the rest of the supply chain, cannot ignore the nation’s ambition of decarbonisation and the race to net-zero. SWA has already embarked on looking at how the wholesale sector can meet those obligations and what the best options are for doing this. SWA chief executive Colin Smith explains that although it may not become the utopian replacement for oil, governments are investing huge amounts of

money in hydrogen as the future technology to run fleets and heat our homes and businesses. He says: “As part of our decarbonisation project, SWA is putting the wholesale sector and members at the forefront of trials and test beds for this technology. “We have already formed some great relationships with leaders in this field, including Cenex (the low-carbon and fuel-cells centre of excellence), Arcola Energy, Ulemco (global pioneers of technology that enables commercial vehicles to convert the fuel they

run on to include hydrogen) and Scottish Power. He also explained how the SWA is also involved in three current proposals to try to get hydrogen vehicles deployed among its members, the first ideally ahead of COP26, the UN climate change conference taking place in Glasgow in November. “Technology is going to play a big part in reducing our food miles and creating a greener and more sustainable wholesale food supply chain, so we want to help businesses share resources and capacity, creating food hubs and linking local producers with the ‘wheels to distribution’,” he adds. The Scottish government is looking for greater local supply chains and the wholesale industry will play a key role in creating these. To help with this, the SWA will soon be launching a localfood logistics training and linking initiative, designed in partnership with the Scottish Agricultural Organisation Society, that will educate and assist producers of all sizes on how to use wholesale as a route to market. “Technology will play a key part in helping not just connect producers and wholesalers, but also in helping to grow the Scottish market for ‘localness’ and track its success. There are many examples of wholesalers in Scotland who have used technology to grow their businesses, and it is this type of thinking that will see our industry become stronger,” Smith says. l

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RN Full page ad.indd 1

09/06/2021 16:47

REPORT KAM Media dives deep into the data that shows why wholesalers should be taking advantage of the latest technology Katie Jenkins is the marketing director at KAM Media

ith predictions of what the future may bring being shouted from every rooftop, there is one theme that consistently rears its head when anyone speaks of how the wholesale industry will survive. Technology, technology, technology. Be it tech-enhanced, tech-driven or tech-enabled, new technologies are playing a significant role in helping businesses navigate their way through the current landscape. Technological

advances are also having a huge impact on the end customer experience within foodservice outlets and convenience stores. KAM Media has therefore done some specific research to find out the key to technological success in wholesale. The key to technology success in general is to not start with the tech, but to start with the end customer. Always. Rather than thinking how it could benefit us, we should start with how it can benefit them. We should consider the key challenges and demands

HOW CONSUMERS KEEP IN TOUCH

33% 22%

Receive emails from them Receive emails from them

14%

Receive texts/SMS from them

Follow on Twitter

Receive texts/SMS from them

Follow on Twitter

12%

27% 18% 20% 13% Have their app

Have their app

Source: KAM Media

11% 7% Follow on Instagram

Follow on Instagram

10%

Follow on Facebook

Social media, but don't actually follow them

3% 4%

Social media, but don't actually follow them

Follow on TikTok

Pub or restaurant

Convenience stores

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Faster, frictionless service Over the past year, many consumers have wanted to get in and out of stores and venues faster for safety reasons, but speed of service has always been important, and technology has a huge role to play here. In total, 34% of people would like the ability to scan items as they go in a convenience store. While 24% would love to see automated ‘Amazon Go’ style checkout where payment is automatically taken on your phone. Swifter payment options are desired in hospitality, too, with nearly half feeling frustrated when ‘waiting for the bill’ and 33% wanting to be able to pay via an app rather than waiting for the server. A safer and less crowded environment Health, hygiene and safety is inevitably higher on shoppers’ agendas. Previously this had focused more on the food and drink they were putting into their body rather than the physical environment they enter. Safety isn’t just about hygiene – 17% of people would welcome facial recognition if it helped make a venue safer. Likely to be accentuated by Covid-19, a third would like to see technology used to help manage crowds and queue time. And 40%

FOR WHAT REASONS DO CONSUMERS THINK BUSINESSES SHOULD EMBRACE TECHNOLOGY?

36%

To speed up service

32%

To help keep prices low

35%

To ensure a safer environment

29%

To make things easier for the staff

34%

To manage crowds/queues

27%

To make things easier for me

33%

To improve my customer experience

24%

To make it easier to find food/drink I want

33%

To make it easier to pay

20%

To reduce energy usage

For more information from KAM Media, please visit kam-media.co.uk

would like to be able to see how busy a hospitality venue is before they arrive via a website or app. The figure is 32% for convenience stores. Again, anything that helps speed of service will help those queues and indeed new scan-as-you-go and automated checkout can help negate the need to queue at all in stores and big gatherings of people. Improved, personalised communication There are multiple ways that all the data generated from new technologies can be used to better understand consumers

Wholesalers can play a vital role in helping their customers access, organise and monetise data and, in turn, benefit themselves

and your retail and foodservice customers: order and pay apps, WiFi logins, loyalty schemes, social media, track and trace, delivery apps, the list goes on. Sales data certainly isn’t the only thing available anymore. Consumers are increasingly happy to share – 78% are willing to share more personal information with foodservice venues, for example, in order to receive more personalised comms. Wholesalers can play a vital role in helping their customers access, organise and monetise data and, in turn, benefit themselves. To help reduce energy usage One in five consumers recognise the vital role technology can play in helping the environment, particularly in reducing energy usage. This obviously has financial benefits for wholesalers as well. We’ve seen investment in energy-efficient lighting, smart fridges and vehicles, for example. Although investment has fallen

Source: KAM Media

that they have, both now and in the longer term. Customers want to feel safe, they want friendly and helpful staff, fast and efficient service, and good availability of quality food and drink.

over the past five years in convenience, it’s hospitality which lags even further behind. For this sector, the focus has been investing in tech to support the customer safety and improved experience. Wholesalers can play an advisory role by ensuring customers have access to relevant eco-friendly solutions. What types of technology are customers ready for? Much of the technology we’ve seen arrive in foodservice and convenience could be seen as going against their very ethos. Where the best hospitality operators and retailers have often tried to maximise the contact points with their customers to improve engagement and service levels, many are now doing exactly the opposite and withdrawing themselves to limit contact. But there is no doubt that technology will form a large part of future service in both environments. l

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REPORT How to promote digital adoption within your company’s customer base Rob Mannion is the founder of b2b.store

ow do you break the habit of a lifetime? For as long as your wholesale business has existed, your clients have been picking up the phone to place an order with you. It may well be part of their weekly routine. They perhaps know your sales staff by name and enjoy the chance to have a Wednesday-morning catch-up. If you are considering introducing an e-commerce element to your business, then your plan to do so is not complete without a customer digital adoption plan. Younger buyers expect to access everything online, but, for those used to a more traditional way of working, you are trying to break the habit of a lifetime. Many wholesalers and online platforms underestimate the difficulty of the task. The rewards of digital adoption may well be clear to you by now. It is well documented that online

basket values can be considerably higher than in-depot baskets, so you stand to benefit not only from increased order values, but also from streamlined logistics and greatly enhanced business intelligence. With those rewards and more on the table, it is too much of a risk to take a ‘build it and they will come’ approach to your digital presence. Adoption among your customer base is something to encourage and nurture. Luckily there are multiple methods to do just that, all of which can be built into a digital strategy. Advertise There is no benefit to you in having an e-commerce website that is your business’ best-kept secret. When introducing an e-commerce website, consider the traditional ‘rule of seven’. Advertising has long accepted that consumers need to hear something around

seven times before they consider a change in behaviour. You are trying to change the behaviour of your customers and, therefore, it may take more than just hearing about your e-commerce offering once. Include your online store in your promotional material regularly. Place the download button in a prominent position on your website. If you engage with customers verbally, then consider asking ‘have you tried the new e-commerce store yet?’ at the end of each conversation. As part of your digital rollout, make a note of when and where you’ll be ‘advertising’ your e-commerce store – for example, on your website, through in-store adverts, promotional mailings and on your social media accounts. The total number of places and messages you’re communicating should be at least seven and, to encourage early adoption, you will

want that communication to happen within the first month of your e-commerce offering going live. Educate Using platforms such as b2b.store that offer fully-branded e-commerce capabilities means your e-commerce platform will be familiar and easy to use, synchronising automatically between mobile, tablet and desktop computers. But education should still be part of your digital strategy. Even if the online store layout and functionality is familiar to your customers, it is not a familiar part of their interactions with you. Consider a video demonstration of how to order and re-order, explaining what happens after an order is placed. If appropriate, you could hold an interactive webinar with your customers, giving them the chance to ask questions before issues occur. Perhaps, though, the main point of education should happen

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during the order process itself. If customers continue to place orders with your telephone sales team, then that team needs to be ready to gently educate your customers that the e-commerce store is now the primary way to order. Encourage your team to highlight features of the store – such as repeat baskets and barcode scanning – that will make customers’ lives easier. Incentivise With customers aware of your online store and educated in how it works, an incentive can help them to take the final step. Ultimately, you want customers using your store in order to reap the long-term benefits. Offering a short-term discount to onboard customers is a price worth paying. Coupons or personalised invitations via push notifications that cover a percentage of the customer’s first three online purchases can be highly effective. By the time the customer has ordered online from you three times, a new habit is well on the

way to being formed. With an overall percentage discount, order values can also climb, meaning your online store hits one of your aims from the very first checkouts and newly onboarded customers are predisposed to increase basket values. You can continue to incentivise usage on an ongoing basis. Ensure communication within the app is personalised and relevant, engaging your customer base. Digitalonly offers and virtual trade events can also help to encourage continued use, as customers gravitate towards your e-commerce store to ensure they do not miss out. An ongoing process Through advertising, education and incentivisation, you will increase digital adoption among your customer base. Be aware, though, that habits of a lifetime can return. In the event that individual customers fall back into old ways of ordering, be prepared to return to your adoption strategy. The growth of your e-commerce offering, and of your business as a whole, can often rely on the success of these adoption efforts. l

For more information from b2b.store (formerly known as RNF), visit b2b.store 19

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REPORT TWC has analysed the habits of online consumers and the opportunities new technologies present to wholesalers Paul Hill speaks to development director Tom Fender

ccording to Tom Fender, development director at TWC, wholesale alongside hospitality, food service and convenience has faced a systemic shock as a result of the pandemic. The channel had to pivot fast, which meant rapid change. But, in many cases, Covid-19 simply acted as an accelerant to trends that were already in play. According to a new McKinsey Global Survey of executives1, their companies have accelerated the digitisation of their customer and supply-chain interactions and of their internal operations by three-to-four years. And the share of digital or digitally enabled products in their portfolios has

accelerated by a shocking seven years. Respondents believe those changes are here to stay. Digital adoption has taken a quantum leap During the pandemic, consumers have moved dramatically toward online channels, and companies and industries have responded in turn. The McKinsey survey confirms the rapid shift toward interacting with customers through digital channels. Respondents are three times likelier now than before the crisis to say that at least 80% of their customer interactions are digital in nature. Technology-driven strategy will put wholesalers ahead The McKinsey survey states the

need for digital strategies to be true corporate strategies that take digital into account. And it highlights that organisations that experimented with new digital technologies during the crisis are twice as likely to report outsize revenue growth as executives at other companies. Consumers have changed their shopping patterns and behaviour. But no one knows the long-term impacts right now. This uncertainty makes trend analysis, market intelligence and data mining more essential than ever. The team at TWC believes the businesses that thrive will be those that are data-led and quick to react. There is evidence that digitalisation, the economy

DIGITALISATION OF FOOD AND DRINK The Covid-19 crisis has accelerated the online trend, seeing 10 years’ worth of growth in a few months.

KPMG head of retail Paul Martin believes ecommerce will account for 50% of retail sales by 2025.

Consumers are now three times more likely to use digital services than before the pandemic2.

Covid-19 digital transformation & technology | McKinsey

mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/how-covid-19-has-pushed-companies-over-the-technology-

tipping-point-and-transformed-business-forever

and millennials will drive lasting changes to consumer behaviour. What does the future hold? It remains the preserve of the few rather than the many who have got to grips with customers data and combined it with ‘customer need’ to create a truly compelling offer that leads to a genuine connection between the vendor and the customer. To facilitate customer data collection at retailer level, subscription or loyalty schemes are essential. There is no other way to collate every purchase a customer makes in real life in the same way that Amazon can collect it online or wholesalers gather it (wholesalers’ customers shop against an account number). Furthermore, millennials and gen Z are very willing to share data in return for offers. For many younger consumers, they see their personal data as a currency. As most of their life has involved shopping online, they expect personalisation and tailored offers. Whether data capture occurs in outlets for consumer shopping or in depot for wholesale purchases, the winners will be those businesses that really start to mine their transaction records to create a tailored customer proposition. There is a misconception that Amazon has skills and technology that is unique that has enabled it to do this first. That is not true – Amazon simply had the foresight and saw the future quicker. l

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Online retail reached a record high this February Internet sales as a percentage of total retail sales3 % 40

retailtimes.co.uk/online-grocery-sales-soar-to-highest-levels-ever-as-british-supermarkets-deliver-exceptional-performance-in-january-nielsen-reports/

20 FE 21 B

20 NO 17 V

20 M 14 AR

20 JU 10 LY

KEY FACTS FROM TWC TRENDS SPRING REPORT 2021 The key drivers to changing channel performance: an increasingly hyper-connected world; a polarised economy; millennials and gen Z becoming workers & earners, activists and spenders.

51%

of UK consumers said that offering customers onlineordering is a no-brainer for convenience stores (65% Millennial, 55% gen Z).

38%

of UK consumers said they can envisage a time when they no longer use/need to shop in store. This rises to more than 50% of millennial and gen Z consumers.

60%

If the 60% of people who regularly shop with Amazon did one big grocery shop per month at a cost of £40, Amazon’s market share would be 7% (bigger than Co-op).

At the start of lockdown, online accounted for 7% of total UK grocery spend. It is now 16%3

For more information from from TWC, please visit twcgroup.net

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REPORT

What do UK B2B wholesalers need to offer international e-commerce? Rob Mannion is the founder of b2b.store

he first thought that comes to mind when you start to think about selling internationally might be Brexit. While Brexit has now happened, and gone are the days when it was the only thing in the headlines, it still dominates the UK export market as the major topic of discussion. There are no easy answers here, as all of us involved in selling abroad already know. But nor is Brexit the only question you will need to answer to sell online internationally. Taking your business into international e-commerce can seem daunting. You may have

identified the marketplace and the opportunity. But now come the practicalities. How can you sell internationally, online, quickly and easily? And, bearing in mind the added complexity of the new export rules and paperwork, is it still worth it? Exporting still offers attractive opportunities for wholesalers The sales opportunities for whole-

salers who can export are still there, so the simple answer for many will be ‘yes’. British produce and British wholesalers continue to be in demand overseas, and UKbased businesses will continue to mature and seek expansion, naturally leading to an exploration of international markets. Put simply: if you don’t pursue international e-commerce when

British produce and British wholesalers continue to be in demand overseas

your business is ready for it, then someone else will. The questions then become a series of ‘how?’, rather than ‘why?’. At first, the sheer volume of those ‘how?’ questions can leave wholesalers with a sizeable to-do list. Simplify the complex: you need one e-commerce site per country As with any sizeable to-do list, it is beneficial to break down some questions into immediate, simple answers.

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things. By segmenting your online e-commerce offering to be ‘one site, one country’, you create the opportunity to tailor your offering to the country in question. By simplifying the complex (you need a new e-commerce site for each country you want to sell into), you have answered several of the questions further down your ‘to-do’ list, starting with language.

When it comes to what sort of e-commerce offering you need to consider, think about how Amazon does international e-commerce. Amazon has regional websites and apps for each location it operates in. Creating a brand-new e-commerce environment for each location may seem a complex step, but with platforms like b2b.store, it is actually relatively simple. You can be selling online, in-country in a matter of days. The reason Amazon does e-commerce in this way, with separate sites for separate countries, is that each country has slightly different ways of handling

Selling in-language Theoretically you can sell into other countries with an English-language website, but if you are a French purchaser, are you going to gravitate towards the wholesaler with a site written in French or the wholesaler who forces you to do your online business in English? In reality, an in-language, in-country website is a necessity for international e-commerce. When translating your e-commerce store, make sure you use a professional translator who understands the sector. Yes, there are free online tools, but their accuracy and grasp of nuance and tone are all debatable. You don’t want to risk spoiling an authentic,

in-country store with inaccurate language. B2b.store can offer professional translation services by native speakers for each version of your e-commerce store, taking one more job off your ‘to-do’ list. Bear in mind geographical differences that reflect into the online world. Language is a major factor, but the design and format functions of your e-commerce site will impact its effectiveness in international marketplaces. Think of these aspects as like body language; if they fail to chime with what you’re saying, your potential customers will know something is not right. Numerical formats, common measurement denominations and payment services all fall into this area. Don’t sell in kilograms if the unit of measurement in the country is pounds. Reverse the day and month in date formatting if you are selling to the US. Don’t force people to use PayPal if there are viable country-specific alterna-

tives that you can set up. A good e-commerce partner, who understands the difference these tweaks to your offering will make, will be happy to adapt your online store to match your international markets. International expansion is still very possible, particularly when it comes to e-commerce. To answer the initial question: ‘What do UK B2B wholesalers need to offer international e-commerce?’, the answer, really, is ‘less than you might think’. A new e-commerce website might sound daunting, but in the 21st century, wholesalers are days away from making that idea a reality. Depending on your e-commerce solution of choice, your online store can be up and running within a matter of weeks. Get the details right – know your ‘hola’ from your ‘bonjour’ – and your wholesale business can find that international online expansion is easier than it has ever been. l

For more information from b2b.store (formerly known as RNF), visit b2b.store 23

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REPORT Five key pieces of advice for wholesale e-commerce Richard Fletcher I solutions specialist, Foodservice Online 1. Get a PIM

While this may seem a strange choice for first tip, you would be hard pushed to find a wholesaler actively using a dedicated PIM solution who does not agree. PIM stands for ‘product information management’, and cloud-based PIM solutions are now readily available. Product data is the lifeblood of e-commerce, but without the right tools it can be complex to collect, store, manage, enrich and distribute. Most businesses have product data everywhere, stuck in back-office systems, e-commerce platforms, shared drives and spreadsheet after spreadsheet. Product data is inherently inconsistent, incomplete and difficult to access. This is why a dedicated PIM solution is so important. Our preferred PIM is Akeneo, which is a great solution for food and beverage wholesalers. It is affordable, quick to implement, easy to integrate and simple to use. A PIM establishes a central database of enriched product information which acts as a single source of truth within your business. A PIM is where you store technical information, descriptions, and media files (images, PDFs, videos) relating to the products you sell. Within a PIM, you can set requirements and supervise the quality of your data across thousands of products. When you need product data for e-commerce, procurement channels, marketplaces, print marketing, customer requests, EPoS, and more, the PIM is where you access this data from

via a suite of powerful APIs or flat file export profiles.

2. Have a PIM strategy

PIM again. A PIM solution needs a PIM strategy, and this can be as simple as identifying one person within your organisation who is responsible for product data and defining the expectations for data quality. You do not need an army of employees to manage product data across thousands of SKUs. From experience, the biggest mistake businesses make is spreading the responsibility for product data too thinly across their organisation. It is never going to work if buyers, marketers, designers, warehousing, IT and e-commerce are all just a little bit involved. Look at your own sales and marketing channels, in particular e-commerce, and based on the quality of product information being presented, would you buy from yourself? This is an important question. At home and in business, buyers rely on good-quality product information to make purchasing decisions. Good images, detailed descriptions and technical data are essential in food and beverage wholesale. With 73% of caterers preferring to access product information online, wholesalers can't afford not to invest in PIMs.

3. Talk to your ERP provider about data access

Not as easy as it might sound, but absolutely necessary. It is notoriously challenging to obtain easy access to data from your back-of-

fice systems, but the ability to seamlessly move this data to and from third-party platforms is more important than ever. In an increasingly digital world, to innovate or merely remain competitive, wholesalers must expand their application networks to include platforms that provide specialist services. At the same time, data relating to customers, pricing, orders, products and inventory must flow seamlessly from platform to platform in order to deliver engaging omni-channel experiences. Wholesalers must work in partnership with their enterprise resource planning (ERP) providers and establish an affordable, timely, robust and scalable way of working with data. ERP/back-office solutions are arguably the most important applications in every business, but they can’t provide every solution, especially when technology is advancing so quickly. E-commerce, business intelligence, CRM and automated marketing are just some of the platforms with the power to revolutionise customer experience, but it will be much harder to adapt without your ERP provider and your data onside.

4. Allocate the proper resources

in total, 83% of caterers use the internet to purchase catering supplies, so spend a few minutes thinking about the following: • What was your total investment in field sales last year? • What was your total investment in telesales/call centre last year? • What was your total investment in e-commerce last year?

Food and beverage wholesalers are comfortable investing millions into armies of sales reps and call centre operators, but many find it difficult to allocate the proper resources towards their e-commerce strategy. Business leaders who are attempting e-commerce transformation must ensure the level of investment and ambition is sufficient when it comes to making key business functions, such as online ordering, marketing and customer service, truly fit for purpose in the digital age. There is no room for complacency. Buyer expectations continue to grow and the fight for foodservice supremacy will increasingly be fought on a digital battleground. A winning e-commerce strategy requires time and resources, and boardroom buy-in is essential.

5. Choose an e-commerce partner that knows the sector and how your business operates

Of course we would say this, but it is the only reason Foodservice Online exists. E-commerce in foodservice wholesale is difficult to get right and if your e-commerce partner doesn’t have the required sector experience, your chances of success are reduced. We have heard many horror stories. From huge delays and blown budgets, to a lack of functionality and even cancelled projects. It is vital foodservice wholesalers take the time to evaluate their options when it comes to e-commerce. Decisions made early in the process are the most important and the implications of getting them right (or wrong) will have a lasting effect on a wholesaler’s ability to be successful in the future. l For more information from Foodservice Online, visit foodserviceonline.co.uk

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Seven reasons why wholesalers should be embracing technology Charles Smith Charles Smith is a journalist with experience writing for the UK's grocery and foodservice wholesale industry

1. Technology helps wholesalers to enter new markets and channels, and to recruit customers

Various buying groups are giving members customer apps, adaptable for B2C offerings. One convenience wholesaler offers retailers storeto-door e-commerce apps targeting shoppers near customers’ stores and is developing AI and machine learning to enhance its offer and recruit new retailers. Fine-food wholesalers are also offering retailers easy-open online accounts and shopping apps. B2C has been foodservice wholesalers’ saviour since the first lockdown. These wholesalers are also using apps to serve takeaway operators and, mid-pandemic, one took 85% of orders online, up from 70% in 2019 – 49% of its January 2021 orders were mobile-generated, up from 2020’s 32%.

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REPORT 2. Technology makes wholesalers‘ businesses more sustainable: including better fleet management and route planning

One buying group has partnered with an energy consultancy to help members manage their carbon footprints, sustainability and CSR obligations. Its head office has adopted permanent flexi-home working, decreased its carbon footprint by 80% and gone paperless. The building incorporates various eco-technology features. Online ordering is boosting wholesalers’ sustainability, with fewer retailers visiting cash and carries. Route planning software is transforming wholesalers’ deliveries: web/app notification informs customers of delivery windows, assists planning and improves turnaround.

3. It can help generate and manage export sales

E-commerce is helping buying groups and wholesalers embrace the export opportunity. One buying group now generates 12% of turnover outside the UK, and sees this proportion increasing. While currently facing short-term issues with EU trading, its present overseas focus, the group predicts business developing in markets further afield, including India, Japan and China. The head office offers expertise to help members use tech to diversify into export, backed up by supplier support. One UK wholesaler presently sells and ships to 82 countries. Its in-house team has developed bespoke software which manages export consignments, creating all the necessary paperwork and assisting customs compliance.

4. Technology makes businesses more efficient through joint planning with suppliers and improved stock availability

One buying group has joint business plans (JBPs) in place with 50 suppliers. It helps wholesaler members with forecasting and launched 300 own-brand SKUs in January, ring-fencing stock ahead of post-Covid-19 demand. One convenience wholesaler has JBPs with its top 30 suppliers by category, centred on core ranging, supported by data sharing. Availability is a core focus, with early stage development on AI and machine learning enabling more accurate forecasting of incoming stock movements. Another delivered wholesaler’s new warehouse management system also improves stock management and order fulfilment.

Thanks to: Confex, Dee Bee, Dunsters, JJ Foodservice, JW Filshill, Savona, Pricecheck and Units for their contributions to this piece

One buying group has adopted permanent flexi-home working, decreased its carbon footprint by 80% and gone paperless

5. Technology can help keep wholesalers up to date and help attract and retain customers by making businesses accessible 24/7 with online ordering on different devices and platforms One buying group has been offering members digitisation advice for more than a decade and is currently developing a national project to support its B2C activity. Recent e-commerce advances enable wholesalers serving different sectors to review SKU searches and missed sales and run purchase-based customer offers. One convenience wholesaler’s new website has a ‘favourites’ option saving regular purchases for easier access. As retailers’ online buying grows, another convenience wholesaler reports capturing 87% of orders electronically.

6. Offer customers a more personalised experience through enhanced engagement One company has been using tech, including members’ apps, for some years. In total, 95% of its members are delivered wholesalers focused on outperforming national wholesalers’ ‘last mile’ service, making strong customer engagement key. In context, good delivered service levels are hard even for Amazon outside major conurbations. E-commerce advances mean growing numbers of wholesalers’ websites actually suggest products related to customers’ recent purchases and based on customer profiling. Various wholesalers are also partnering with suppliers to manage customers’ Facebook pages, jointly promoting consumer offers. Social media is also helping wholesalers tailor their offering to their community.

7. Encourage frictionless trading by introducing click & collect and cashless payments

Covid-19 has made contactless payments the rule in cash and carries, eliminating cash handling. Click & collect also reduces depot footfall. Cashless payment on receipt isn’t really suitable for delivered wholesalers. However, they are seeing growth in click & collect and discounts for upfront payment. One convenience wholesaler has selfserve tills in its facia stores and no cash and carry facilities, only click & collect. Average customer turnaround to collect, pay and load is under 10 minutes. l

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The wholesale sector is evolving, and so are we. Take a look at our new-look website betterwholesaling.com where you will find: • More news and thought leadership • In-depth wholesaler profiles and video interviews • Sector and category reviews • Easy-to-digest infographics highlighting key industry trends

Stay informed and get ahead with betterwholesaling.com

BW.com Forward sell June 2021.indd 1

18/03/2021 10:16

WORKING TOGETHER PROJECT

Working Together

PLANT-POWER YOUR PROFITS Paul Hill finds out how Alpro and Parfetts are working together in the plant-based category Plant-based and dairy-free is fast-becoming a ‘miss it, miss out’ sales opportunity for wholesalers, with retail sales hitting £533.4m1 and two in five households now buying plant-based products – this is projected to be 50% of households by 2025. Category-leading brand Alpro was recently on hand in Parfetts’ Stockport depot to show how its bestselling product range offers wholesalers the chance to really maximise on this fast-growing opportunity. “It’s great to work with Parfetts to discuss the huge sales opportunity that the plant-based and dairy-free category presents,” explained Holly Bill, national account manager at Alpro. “We’re always eager to work with our partners to support their growth, through tangible advice that can really make an impact.” Steven Armstrong, trading negotiator at Parfetts, added: “It’s fantastic to have Alpro’s guidance in the plant-based and dairy-free category. We’re always looking for valuable tips and advice that will help drive sales, especially in a category such as this, which is experiencing exponential growth.” Bill then explained how sales of plant-based food and drink in convenience stores have increased by 65% in the past year alone1. “The category has seen a significant uplift in the past 12 months, but there is still plenty of scope for growth within the convenience channel. Research2 shows that only 9% of regular plant-based shoppers currently buy from a convenience store, but 85% agree they would do if the right products

were available,” she added. It is clear, then, that the category can drive basket spend and incremental sales, with Bill also stating that 75% of plant-based drinks purchases are made on a regular and repeat basis, and plant-based shoppers spend around 36% more in store1. “Our advice for wholesalers is to stock a selection of the bestselling plant-based products, such as Alpro 1l drinks – including Alpro Oat No Sugars drink and Alpro Soya Original drink – which will, in turn, help retail customers to grow their sales,” she said. “Stocking Alpro’s food-to-go options – such as our Greek Style alternative to yoghurt pots, Caffe Cups and Chocolate Praline drinks – can also offer wholesalers the opportunity to tap into the growing demand for plant-based on the go.” Alpro is planning to capitalise on this with a huge investment in high-impact marketing, including a multimillion-pound ‘No Sugars’ campaign which kickstarted the year. This will increase its high brand recognition from retailers – currently 70% of retailers have heard of Alpro, of which 57% have stocked it4. “Wholesale remains a key channel for us and one that we enjoy working in immensely. This is the beginning of a successful partnership with Parfetts – the experience has been hugely beneficial for both parties and we’re confident we’ll see plenty of opportunity for growth across the entire wholesale channel heading into the future,” concluded Bill.

p40-41 Working Together AlproROUND 2.indd 28

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In partnership with

STATS

Only 9% of regular plant-based shoppers currently buy from a convenience store, but 85% agree they would do if the right products were available2 Sales of plant-based in Plant-based convenience stores are shoppers spend storming by +65% around 36% more in store2 Alpro drives 1

By 2025, 1 in 2 of your customers will be looking for plant-based dairy alternatives in your store3

64% of all value sales in the impulse channel1

IRI, 52 w/e 30 Jan 2021, 2Alpro Shopper Study, 2020, 3Mintel, KAM Media, 2020 RTC research of 250 convenience store owners

1 4

SUPPLIER VIEWPOINT Holly Bill, national account manager, Alpro

THREE STEPS TO PLANT-POWER YOUR PROFITS 01 Stock the plant-based bestsellers – Getting the basics right is a key step to achieving more sales. This can be as simple as wholesalers stocking a selection of the bestselling plant-based products, which will help their retail customers to grow their sales in turn. 02 Focus on the leading plant-based brands – It’s key for wholesalers to focus on stocking the biggest brands that their customers will be expecting to see. As the leader in the plant-based and dairy-free category – accounting for 64% of all value sales1 in the impulse channel – Alpro provides a ‘one-stop shop’ for plant-based, with ongoing NPD and innovation, and a focus on food to go. 03 Create a plant-based zone – It’s really important to merchandise correctly and create a dedicated plant-based fixture to make this category as easy as possible for retailers to navigate in depot. As retailer understanding about plant-based is still evolving, Alpro recommends to dual site its 1l drinks in both the chiller and in ambient for maximum visibility to ensure these products are accessible in high-footfall fixtures.

“Healthy eating and sustainability have been rising on the consumer agenda, and the pandemic has propelled this one step further – with health taking hold like never before. We’re confident that we’ll see longer-term behavioural changes towards plant-based among even more shoppers.”

WHOLESALER VIEWPOINT Steven Armstrong, trading negotiator, Parfetts

“It’s been great working with Alpro to discuss the plant-based and dairy-free category, and to hear about the key trends moving in the sector. Meetings like this are key to gaining valuable insight that will not only improve our operations, but also our retail customers’ shopping experience and sales.”

For more information, please email holly.bill@alpro.com 29

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17/06/2021 11:47

WORKING TOGETHER PROJECT

Working Together

Soft drinks success Paul Hill finds out how SBF GB&I and Lioncroft Wholesale are working together in the soft drinks category Soft drinks has always been important to the wholesale channel and it is now a category that brings with it a £1bn1 opportunity over the next five years. As a category leader, Suntory Beverage & Food GB&I (SBF GB&I) was recently in Lioncroft Wholesale’s Aston depot to offer its expert advice to the wholesaler. “Wholesale remains a key channel for us and one we love working in,” explained Andrew Pheasant, head of regional accounts at SBF GB&I. “We see plenty of opportunity for growth for soft drinks across wholesale as we head into the post-Covid-19 landscape.” Darren Pugh, senior trading controller at Lioncroft, added: “It’s fantastic to have SBF GB&I here to help guide us in the soft drinks category. You can’t stand still – we’re always looking for valuable tips and advice that will help drive sales and help us educate our retail customers.” SBF GB&I presented Lioncroft with data and detail on the latest trends in the soft drinks market, and how they can capitalise on these in depot. Pheasant explained how wholesalers should make sure they stock a range of options to enable shoppers to find the right drink for them throughout the year. “We know that the five must-stock highest-value segments – carbonates, energy, water, juice and sport – contribute to more than 85.5%2

of soft drinks sales, for example,” he said. “Wholesalers can grow sales by making sure they put the right drinks in the right places so their retail customers can find the bestsellers easily. “In other depots, we’ve seen examples of how relaying a fixture according to format and in order of bestsellers can increase sales of certain categories by more than 90%. By blocking sports and energy by need state – starting with stimulants, flowing into sports, then energy and finally natural energy – customers will be able to easily find the right drink for the right occasion,” he added. He went on to describe the impact Covid-19 has had on soft drinks. Total sales are up 2.2%3 and, within this, energy drinks are up 4.2%4, carbonated soft drinks sales have grown 40%5 in the last year, and flavoured carbs also grew 7.1%6 during the pandemic. Furthermore, price-marked soft drinks are growing at a fast rate, up 16% year on year, accounting for 60%7 of total soft drinks sales in symbols and independents. “It’s been great running through our insight with the Lioncroft team. By identifying fundamental pieces of data and highlighting key consumer-buying motivations, we can really help Lioncroft and its retail customers tap into the huge category opportunity,” concluded Pheasant.

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In partnership with

Energy and sports drinks account for

30%

of total softdrinks sales in convenience9

Carbonated soft drinks sales grew

40%

last year10

THREE WAYS TO INCREASE SOFT DRINKS SALES: 01 Focus on range – Wholesalers should be aware of the drinks their retail customers are looking for. Focusing on core categories can really help maximise soft drinks sales. Energy and sports drinks account for 30%11 of total soft drinks sales in convenience, so it’s an important segment for any retailer’s chiller and thus any wholesaler’s shelves, especially in the summer. 02 Formatting is key – The key for wholesalers is to have suitable pack sizes available to ensure they have the right product for the right occasion. Drink-later formats are growing by 8%12, and multipacks have seen growth of 18.1%13 over the past year. The SBF GB&I portfolio reflects this – driven by a range of NPD, we have seen impressive growth of 9.1%14 in Lucozade Energy’s drink-later portfolio. 03 Pay attention to seasons – Events, seasons and special occasions are a really great way to engage and drive sales. This summer we will see some big sporting events which will engage the general public. A normal summer usually results in a 10-12% uplift in soft drinks sales. With 60% more people holidaying in the UK in 2021, there’s a £160m opportunity that can be unlocked. SBF GB&I category research, 2020, 2EXT IRI, Symbols & Indies, latest 52-week data ending 24.11.19, 3EXT IRI, MarketPlace, GB, Value Sales, latest 52-week data to 21.02.21, 4EXT IRI, MarketPlace, GB, Value Sales, latest 52-week data to 21.02.21, 5IRI MPF Data to 23.03.20, IRI SL Data to 05.05.20, 6EXT IRI, MarketPlace GB, Value, latest 13 weeks to 26.07.20 vs YA, 7IRI MPF Symbols and Indies, GB, latest 52-week data ending 26.07.20, 8SBF GB&I category research, 2020, 9EXT1 IRI, Convenience, GB, latest 52-week data ending 22.11.20, 10IRI MPF Data to 23.03.20, IRI SL Data to 05.05.20, 11EXT1 IRI, Convenience, GB, latest 52-week data ending 22.11.20, 12IRI SL Data latest 8-week data to 17.05.20 (total drink-later change vs YA), 13EXT IRI Marketplace GB, Value Sales, latest 52 weeks to 21.02.21, 14EXT IRI MarketPlace, GB, Drink Later, latest 52-week data ending 22.11.20 1

SUPPLIER VIEWPOINT Andrew Pheasant, head of regional accounts, Suntory Beverage & Food GB&I

“At SBF GB&I we work hard to understand how shoppers buy, and through research we’ve identified how convenience retailers can look at this and grab a share of a £1bn8 opportunity over the next five years – worth almost £9,000 to every shop.”

WHOLESALER VIEWPOINT Darren Pugh, senior trading controller, Lioncroft Wholesale

“It’s been brilliant having SBF GB&I here today to discuss the soft drinks category and to hear about the key trends moving in the sector. Meetings like this are key to gaining valuable insight that will not only improve our operations, but also allow us to educate our retail customers.”

For further information, please visit linkedin.com/company/suntory-beverage-food-gb-i/ For the project video, go to betterwholesaling.com

p30-31 Working Together SBF.indd 31

17/06/2021 17:01

SECTOR REVIEW – PRICE-MARKED PACKS

Price-marked packs Tom Gockelen-Kozlowski

ver the years, price-marking has been used, and misused, and even started out as something of a hate figure for some in the industry. Yet, the past 12 months – which has changed so much in wholesale – has proved that PMPs are now here to stay, whatever else might come and go. One part of the depot which makes this clear is the snacks aisle, where PMPs are everywhere. According to suppliers, it is also one of the areas to have seen the largest change in consumer behaviour during the pandemic. “We’ve seen a huge shift in the shape of missions for symbols and independent stores, which wholesalers needed to react to, and we’ve seen take-home missions become a lot more relevant,” says Guy Harvey, category controller for impulse at PepsiCo. “There were 11 billion more at-home occasions in 2020 than the year before, and we saw take-home account for about 60% of all missions.” Harvey says this meant that bigger packs – often £1 or £2 PMPs – became far more important to the channel. “PMPs were the numberone contributor to growth in the category. The total category grew at 5.3% but PMPs grew at 16.3% and added about £30.3m of new retail sales value (RSV) into symbols and independent stores,” he says. Communication during this time of flex was vital, he says: “Making sure wholesalers were aware of that trend was incredibly important at a time when single packs and foodto-go missions were supressed.” PMPs are available across all formats of PepsiCo’s Hero 25 (including brands such as Walkers, Doritos, Squares and Wotsits). The trend for larger, sharing

formats has also been seen by KP Snacks, another key player in the snacks category. Matt Collins, trading director for the company, says it sees some of the pandemic-inspired shifts in shopper behaviour leading to a permanent change. “The £1 PMPs [in snacks] have seen significant growth in the past few years and this format will stay increasingly relevant during and

post-pandemic,” Collins says. “As restrictions are lifted, shopping behaviour will shift back to ‘little and often’ as recessionary conditions prevail. As this happens, promotional mechanics and appropriate merchandising will play a key role in offering value to shoppers, serving both ‘insulated’ and ‘constrained’ spenders.” According to Collins, larger

snacks firms offering PMP-type promotions will be a key feature in efforts to maintain shoppers’ habits of heading to local stores as their first port of call. Among the PMP arrivals for KP Snacks is McCoy’s Fire Pit, available in a £1 PMP format and inspired by “the trend of open-fire, or ‘wood-fired’, cooking”. Confectionery is another area long associated with PMPs and

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SECTOR REVIEW – PRICE-MARKED PACKS SUPPLIER VIEWPOINT Phil Sanders, Out-of-home commercial director, Britvic

Looking to the months ahead, the rollout of multiple vaccinations against Covid-19 and the government’s roadmap offers hope of a not-too-distant recovery and some semblance of normality. As people start to feel more confident about returning to variations of their old day-to-day routines – whether that be attending university or working from the office more regularly – retailers will need to prepare accordingly. But as we experience a challenging ongoing financial period, shoppers will still be looking to spend wisely and PMPs can offer assurance that they are getting great value. Therefore,

retailers need to be prepared for the expected recovery, by stocking cans or 500ml bottles from well-known, trusted brands to help revive on-the-go sales. And wholesalers can help by having the right range of PMPs in stock throughout the months ahead. Offering PMPs of well-known brands provides shoppers value for money across favourites they would be looking to purchase on a regular basis. For example, retailers can stock our £1.49 price-marked 900ml bottles of Robinsons Orange, Apple & Blackcurrant and Summer Fruits squash.

Susan Nash, trade communications manager at Mondelez International, says it’s a part of the market wholesalers still need to focus on: “For shoppers, PMPs offer reassurance they are not being overcharged, while contributing to an overall positive price perception. For wholesalers, the perception of improved value, convenience and trust from their customers make stocking PMPs a good option.” Nash says Mondelez now offers its widest-ever range of PMPs across all categories and this includes confectionery singles of its Cadbury Dairy Milk Caramel bar, now available in a new 60p PMP. Mondelez is also making its Cadbury Darkmilk available in a 55p PMP. Soft drinks Complementing the array of snacks and chocolates proudly sporting price-marks is the soft drinks sector,

where big names are also using the pricing strategy. Matt Gouldsmith, channel director for wholesale at Lucozade brand owner Suntory Beverage & Food GB&I, says PMPs have played an important role in how the business has adapted its offer to changing customer behaviour: “To help wholesalers cater for shoppers drinking more soft drinks at home, we have reduced the on-pack price of some of our most popular drink-later products, including Ribena 600ml squash and Lucozade Energy 1l format drinks.” Pepsi brand owner Britvic, meanwhile, is providing a range of PMPs for brands including Robinsons, Pepsi Max, 7Up and Tango. Mark Tanner, head of independent and wholesale at energy drink Carabao, says PMPs also continue to play an essential role in helping shoppers make budget-friendly choices: “Carabao’s range of pricemarked packs offer exceptional

PRODUCT NEWS

Jacob’s Mini Cheddars (PMP: £1) – Launched in May 2021, the brand’s Red Leicester and Nacho Cheese & Jalapeno are available as a £1 sharing format.

Tango Dark Berry (PMP: £1) – Britvic has produced what it calls “temporary” price-marked formats across brands including Tango, Pepsi Max and 7UP Free.

Red Bull core range (PMP: various) – The energy drinks range is available in PMP and non-PMP formats, including Red Bull Original in 250ml, 355ml and 473ml, and Red Bull Sugarfree 250ml.

Aunt Bessie’s 12 Golden Yorkshires (PMP: £1.85) – Birds Eye has pricemarked packs available across its core range of bestsellers including Aunt Bessie’s and Goodfella’s pizza.

Quavers Retro Flavours (PMP: £1) – PepsiCo has brought to market a £1 sharing format for the Quavers range. This time it’s for the return of Prawn Cocktail and Salt & Vinegar.

Graze Cocoa Vanilla Protein Oat Bites (PMP: £1) – The Unilever-owned brand is now supported by a new TV campaign and has become one of the bulwarks of the fast-growing healthier snacks category.

p32-36 PMP.indd 34

17/06/2021 15:39

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*NielsenIQ RMS, Total Coverage, 52 w.e. 27.03.2021. Value Sales **NielsenIQ RMS, Fruit Carbonates, Total Coverage, Volume and Value, 52w.e. 27.03.21 ***IRI; Convenience; Value Sales; 52 w/e 28.03.2021 ****NielsenIQ, Scantrack, Total Coverage Total Fruit Carbonates - Tango RSV, Abs Value Growth YOY 52w/e 24.04.21 Britvic has updated its 500ml PMP offering to a competitive single price point of £1, temporarily, across it’s whole no added sugar range

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01/06/2021 09:43

SECTOR REVIEW – PRICE-MARKED PACKS

TAKEAWAY POINTS

value across the board and are testament to the brand’s commitment to provide consumers with a choice of great-tasting fruit flavours that contain less sugar and fewer calories than competitors.” Alongside an ‘Only 69p’ PMP on Carabao 330ml cans, the company has worked with Unitas and Sugro to offer special price promotions for those who stock all four PMP flavours, with a ‘buy three, get one free’ offer available in June and July. Frozen foods Another area where PMPs continue to have a major influence is in the frozen foods category. Chris West, commercial manager for Birds Eye, says this has made the firm adapt its strategy in recent times: “To deal with the rise in demand of frozen

products, we’ve created a clear core range for wholesalers to help retailers focus on the top-selling products that can appeal to a broad range of different shoppers and their needs.” Products featured in this core range include Birds Eye eight cod fish fingers (PMP £2.50), Goodfella’s Stonebaked Thin Cheese Pizza (PMP £2.50) and Aunt Bessie’s 12 Golden Yorkshires (PMP £1.85). Much has changed over the past year and the service wholesalers have needed to provide their retailer customers with is, in some cases, radically different. Yet it appears the use of PMPs is a trend for all seasons and has, in many cases, come into its own, with the category still providing plenty of profitable opportunities. l

1. Lockdown changes may be here to stay – While PMPs have retained their relevance during the pandemic, the formats that customers have flocked to have changed. This means more sharing options and larger formats in general, and it’s a trend that can been seen across snacks, confectionery and soft drinks. While we’re all enjoying our new freedoms to socialise and get out, a year of lockdowns has supercharged the trend for having a cosy night in with friends or loved ones. Wholesalers, therefore, need to make sure they look out for PMPs on the right formats if they wish to stay relevant. 2. Bestsellers have fully embraced the PMP – In a tough year for most, big brands are using PMPs to provide assurance to customers that their products remain affordable and offer good value for money. So, PMPs are now appearing across marquee brands, from Birds Eye to Red Bull, and even on the packs of emerging premium brands such as Graze. Cadbury, Robinsons and Walkers, meanwhile, have gone as far as to make PMPs available right across their bestselling ranges. There was a time when the widespread belief was that PMPs could diminish the value of the biggest brands. That time has gone. 3. Maintain a focus on the market – Of course, in a year that has changed so much of our lives, a key lesson is that a lot can change in 12 months. Right now, sales of single packs of crisps are supressed, for example, as many food-to-go missions have all but disappeared. There is even a debate whether the traditional commute will ever return. Yet the next 12 months will – we hope – be a time of recovery and returning to normal, and this could have a huge effect on shopper behaviour. Suppliers will want to engage with their wholesale partners to ensure in-depot ranges keep up.

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17/06/2021 15:39

INDUSTRY SPOTLIGHT

In partnership with

KP Snacks

BWI: How have you helped wholesalers grow sales in the past 12 months? MC: Over the past year, we’ve supported our customers through unprecedented shifts in demand. We’ve pivoted to changing needs, ensuring continuity of supply, and reflecting changing customer dynamics, missions and occasions. We are proud of how our industry has responded to this crisis and our partnership approach is more important than ever. We’ve got two key objectives now. The first is to help the out-of-home sector rebuild and flex to be ready for revival. The second is to help retailers retain the business they’ve won and to lap 2020 comparisons. With the successful vaccine roll-out and reawakening of hospitality, foodto-go occasions are on the up. A summer of sport and sharing occasions are on the horizon, representing a huge opportunity for retailers to retain bigger basket share and for out-of-home outlets to capitalise on food to go and social occasions.

£2.1m

in sales after 16 weeks in stores

category and continue to drive growth by capitalising on key consumption trends, including food to go, sharing and health.

What would you like to see happen in wholesale in the next 12 months? What trends and Sharing of data and opportunities are insight to power The value of the emerging that decision-making is crisps, snacks customers can take vital, improving both and nuts advantage of? information flow and category Crisps, snacks and nuts decision-making around (CSN) is a fast-growing, trends. Data insights can priority category with huge also play a significant role in scale. It is a critical driver of wholesupporting wholesalers in improving sale and a key impulse category, worth stock availability and be an effective £3.4bn and growing by 3.6%1. tool in rationalising range to support Wholesalers need to prioritise the bestsellers and winning NPD.

£3.4bn

Are you planning any activity of which wholesalers should be aware? We have an exciting pipeline of activity to help deliver CSN growth for our partners. Event: As we ease into summer, people are looking forward to getting outdoors. We’re delighted to be able to celebrate this in our role as official team partner of The Hundred, an action-packed, new 100-ball cricket competition. The Hundred is a tournament for families to enjoy and will help KP Snacks champion healthier lifestyles and inspire families to get more active through cricket. Activation: We’ve just launched a new cross-brand promotion ‘Win £2021’, which looks to champion positivity through 2021 and drive singles sales. The campaign offers shoppers the chance to ‘win the year in cash’ and will be promoted on all Hula Hoops, McCoy’s, Skips, Nik Naks, Discos and Wheat Crunchies packs in grab bag and £1 PMP format. Product: We’re proud of our everpopular PMP range, which we continue to refresh to drive interest and excitement. Earlier this year we added a 70g £1 PMP for Discos. This summer we’ll also be introducing a £1 PMP of our premium handcooked crisp range, Tyrrells. NPD: McCoy’s Fire Pit has now hit £2.1m of sales after 16 weeks in stores. Launched in PMP, grab bag and multipack formats to capitalise on all missions, McCoy’s Fire Pit has three BBQ flavours and is perfectly placed to reignite formats and drive category growth by delivering variety and excitement. l

Nielsen MAT, w/e 24 April 2021

McCoy’s Fire Pit hit

Matt Collins, trading director, KP Snacks

FAST FACT

Rationalisation and improved customer satisfaction can also be achieved with the right depot layout and structure by mirroring an in-store fixture, for example, and by blocking similar types of products together to make it easier for retailers.

p37 KP Industry Spotlight ROUND 2.indd 37

17/06/2021 16:02

INDUSTRY SPOTLIGHT

In partnership with

Imperial Tobacco FAST FACT Tom Gully, head of trade marketing, Imperial Tobacco BWI: What new variants have been added as part of the Embassy range? TG: We’ve recently launched four new products under the Embassy Signature umbrella, designed to unlock sales among shoppers seeking out top brands at affordable prices, and to deliver increased sales and profit margins for wholesalers. The full range comprises Embassy Signature Gold and Silver variants, including Embassy Gold Superkings, as well as Embassy Signature New Crush, which features a unique cooling-sensation filter. How has the launch of the new Embassy range worked in the wholesale channel? The Embassy brand has enjoyed continuous growth over the past 12 months1 and with the sub economy sector worth almost 60% of the total factory made cigarettes (FMC) market2, we’re confident our new Signature range, where everything is premium but the price, will drive further sales for our wholesale customers in the months to come. What trends and opportunities are emerging that customers can take advantage of? A trend that we’ve seen developing in recent years is a move towards a nicotine portfolio with adult smokers buying different products to suit different occasions. Given this trend, wholesalers must be well-equipped with a strong product range across all categories in order to cater for this

Embassy is back: growing share to a

10-year high for the brand3

trend and keep one eye on their sales so they can adapt their range to meet the needs of their customers. How have you helped wholesalers grow sales in the past 12 months? As the true economic impact of the pandemic becomes a reality for many, we may see shoppers down trade from premium brands to more value-focused offerings. To help wholesalers and their customers cater for these shoppers, we’ve been busy developing a range of products across both the roll-your-own (RYO) and FMC segments. What is the greatest challenge that the wholesale industry faces? I think it’s fair to say that Covid-19

remains a significant challenge for the wholesale industry. But, thanks to the tenacity and incredible work of the wholesale sector, it continues to ride the storm. What challenges have you had to overcome in the past year? Businesses across the country have all experienced a number of challenges to work through over the past year. Aside from those related to Covid-19, we've also had to navigate through a major piece of legislation with the introduction of the menthol ban in 2020. What has been your greatest achievement in the past year? We’ve launched a huge raft of innovative products into the market to help our wholesalers and their retail customers cater for the ever-changing needs of smokers. These include a range of products specifically designed for smokers looking to transition away from menthol cigarettes, with brand-new launches that offer familiar characteristics, such as white tips and special reducedsmell paper. What would you like to see happen in wholesale in the next 12 months? I think there is a big opportunity for wholesalers to support retailers by offering more information and advice for their customers. We have an ever-changing environment, particularly in tobacco, and those wholesalers that are able to advise their customers on the latest category trends, brands performance and product launches are benefitting from this service. Where wholesalers are keen to work with Imperial to promote staff education, we have invested and established new ways of working to help them to achieve this. l Based on ITUK estimates and EPoS data October 2020, 2ITUK Report on Trade, October 2020, 31.6% Mar 2021 vs 2010, ITUK estimates 1

p27 Imperial Industry SpotlightROUND 2.indd 38

17/06/2021 16:04

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LONDON CER 15/06/2021 09:55

SECTOR REVIEW – VAPING, TOBACCO & NEXT-GEN NICOTINE

Vaping, tobacco and next-gen nicotine Toby Hill

SUPPLIER VIEWPOINT Duncan Cunningham, UK corporate affairs director, Imperial Tobacco & Blu

hile factory made cigarettes (FMCs) remain the largest single component of the UK tobacco market – accounting for 54% of the £2.5bn sector last year – a number of trends continue to reshape their role within the category. The principal shift – spurred by 2017’s plain packaging legislation – is the heightened importance of price within the category, meaning an increasing proportion of consumers are seek-

ing out economy products. “Price remains a key factor for existing adult smokers – wholesalers, therefor,e should stock up on value products,” says Gemma Bateson, head of reduced-risk products at JTI UK. The increased importance of cost in tobacco consumers’ buying decisions has provided a boost to sales of roll-your-own (RYO) tobacco, with volume sales growing by 30%. Tobacco companies have responded to this by launching a string of new rolling tobacco lines, such as

Wholesalers need to know the market. Vaping is large and rapidly growing for wholesalers and retailers. With only a fraction of vaping sales currently coming from traditional retail outlets, there is a huge opportunity to grow the market share in the convenience channel by more effectively catering to the growing consumer demand. Wholesalers and suppliers need to work together to educate retailers on the bestselling products and where the growth areas are to help them harness the opportunity. Ranging availability is also important and wholesalers should make sure that they stock a comprehensive range of products that includes both best-

selling products and innovative new products that are likely to see growth. For example, as the vape market continues to grow, pod-mod systems such as Myblu have become increasingly popular among consumers thanks to their ease of use and flexibility. Furthermore, wholesalers can do a number of things to drive sales in the vaping category, such as ensuring that they display and promote vaping products, such as Myblu, in and around their stores in areas of high footfall and at PoS, not just in tobacco rooms. Wholesalers should contact their Blu rep to see what display options are available to them to help drive sales.

p40-44 Vaping & Tobacco.indd 40

17/06/2021 16:12

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Log on to our trade website at republictechnologies.co.uk

ENJOY THE FLAVOUR FUSION

Republic Technologies (UK) Limited, Sword House, Totteridge Road, High Wycombe, Bucks, HP13 6DG

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SECTOR REVIEW – VAPING, TOBACCO & NEXT-GEN NICOTINE JTI’s Sterling Rolling Tobacco Essential 30g, with an RRP of £12.35, and Kensitas Club Rolling Tobacco 30g 3-in-1, with an RRP of £11.95. With some consumers appreciating the convenience of having accessories included with their tobacco, and others preferring to buy specialist lines of papers or filters, it’s also worth wholesalers ensuring they offer both options as part of their rolling tobacco range. Furthermore, as part of this shift towards economy products, a growing number of consumers are taking a “portfolio” approach to tobacco smoking, moving between RYO and FMCs depending on the occasion. Imperial recently launched a new line specifically targeting these part-time roll-up smokers, JPS Players Easy Rolling Tobacco, which “features a more vibrant colour and lower levels of moisture, making the

blend easier to handle and to roll”, according to Imperial’s UK corporate affairs director, Duncan Cunningham. Finally, also benefitting from the ever-tightening restrictions on traditional tobacco products are sales of cigarillo products, which are now worth around £6m a month. Last year, cigar specialist STG launched a new line aimed at introducing more adult smokers to cigarillos, Signature Action, which come with a peppermint filter and are available in packs of 10. Awesome accessories This increasing consumer shift towards economy and RYO products also presents new sales opportunities for tobacco-related accessories. With consumers no longer able to buy menthol cigarettes, new ‘fusion cards’ have become popular, with both Imperial and Republic

Technologies offering flavour cards that can be inserted into FMC and RYO packets to add flavour. Imperial offers flavour cards under its Rizla brand and are “currently selling around 900,000 packs per week”, according to Cunningham. Meanwhile, Republic Technologies offers two flavours under its Swan brand, Fresh Burst and Menthol. “Following the change in legislation last May, there has been a considerable rise in the number of consumers making a conscious decision to find competitively-priced flavour alternatives to menthol cigarettes,” says Gavin Anderson, head of sales at Republic Technologies (UK) Ltd. Accordingly, in addition to the infusion cards, accessories manufacturers have also introduced new menthol capsule filters for the RYO market, including Imperial’s Rizla Polar Blast

Crushball filters and Republic’s Swan Fresh Burst Crushball. Finally, another new trend in accessories is a heightened environmental awareness among shoppers. “This has led to a surge in category-boosting products such as OCB Virgin Slim & Tips and OCB Organic Hemp Slim & Tips, which are unbleached and 100% vegan, made using OCB natural gum sustainably sourced from African Acacia trees,” Anderson explains. Vaping ahead New trends continue to shape the vaping market, too, which is now worth around £1bn in the UK, with around 30% of vaping sales taking place in traditional retail stores. Such retailers saw sales surge during the pandemic, as specialist vape stores – which make up about 50% of the market, with the remaining 20%

PRODUCT NEWS

Logic Compact – With simple-to-use closed pod-mod systems increasing in popularity during the pandemic, this is a good bet for wholesalers seeking to expand their vaping offering.

Nordic Spirit – Snus tobacco pouches, which nestle against users’ gums releasing flavour as well as nicotine, are a staple tobacco product in Scandinavia.

JPS Players – With an increasing number of smokers taking a ‘portfolio’ approach encompassing various formats, easy-rolling products such as Imperial’s JPS Players are strongly placed.

Embassy Signature New Crush – This nifty innovation brings smokers close to the old menthol cigarettes and contains Virginia tobacco wrapped in paper with a unique cooling sensation filter.

Signature Action – With 10-packs of cigarettes now just a distant memory, more consumers are open to different options, such as cigarillos, reflected in increased sales of products like this.

Dinner Lady Vape Pen – The disposable e-cig is another big trend to reshape the vaping market through the past year, offering a simple-to-stock, sell-and-use solution for wholesalers.

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STERLING

R O L L I N G TO B ACCO

ESSENTIAL

FROM THE

BRAND THAT

DELIVERS

.35

RRP* 30G

Roll your way. No papers or filters

Whole leaf blend

UK’s fastest growing tobacco brand**

*RRP effective 09/04/21. You are, of course, at all times free to sell JTI’s products at whatever price you choose. **IRi Market Place, Volume Share, Total RYO/MYO, Total UK, over the last 12 months to Mar 2021 (based on slope calculation)

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SECTOR REVIEW – VAPING, TOBACCO & NEXT-GEN NICOTINE

TAKEAWAY POINTS 1. Move with the tobacco trends – The legacy of plain packaging remains strongly felt in the tobacco market, with price a dominant factor in many consumers’ buying decisions. This is true within factory made cigarettes (FMCs), where value lines have seen a huge boost in sales in recent years. It’s also a trend that has seen the market share of roll-your-own (RYO) tobacco increase sharply – and created a sub-set of “portfolio” smokers, who move between the two depending on occasion. Wholesalers want to ensure they have the right products to cater for all these types of consumer. 2. Simpler vaping – Open vaping systems, in which vapers add the liquid themselves, remain the most popular method for vapers to inhale their fumes. However, the dominance of this system has decreased through the past year, as an increasing number of vapers plumped for simpler, more accessible systems through the chaos of the pandemic. There are two main options that wholesalers can consider to meet this trend, which is well-suited to their convenience retail customers: either closed systems, in which customers replace the cartridg, or wholly disposable e-cigarettes, such as Vape Dinner Lady’s Vape Pen. 3. Innovative options – Tobacco as a category is reinventing itself at a galloping pace in response to both consumer health concerns and state legislation. And this isn’t just a case of expanding the vaping category – other innovations are also set to gain an increasing foothold over the year ahead. One example is heated tobacco products, such as JTI’s Ploom, which come in a range of flavours. And another is snus, a staple tobacco product in Scandinavia which has, over the past year, gained strong traction among British consumers. JTI’s Nordic Spirit is currently the country’s bestselling line, available in methol and fruit flavours.

being online sales – shut for long spells of the lockdown. While open systems – which vapers refill with liquid themselves – have traditionally dominated the vaping market, leading manufacturers including Imperial (Blu) and JTI (Logic) observe that closed pod-mod systems such as Myblu are becoming more popular. “Closed tank devices, or pod mods, are currently the fastest-growing vaping segment in the UK, as well as the biggest segment within the category for value sales,” notes Bateson at JTI UK. “Vapers are looking for convenient and easy-to-use devices that they can experiment with in terms of flavours and strengths to find the right fit,” she adds. Another trend is towards disposable e-cigarettes, which come pre-charged and prefilled, making them particularly well-suited to the convenience sector, according to John Taylor, chief marketing officer at vape specialist Vape Dinner Lady. “For wholesalers and their customers, and in turn their consumers, the Vape Pen needs no prior

specialist knowledge of vape – simply open the box, remove the caps and go,” Taylor says. Vape Dinner Lady’s disposable Vape Pen launched at the start of this year and offers adult smokers 400 puffs, according to the firm. Breakthrough innovations Finally, a number of new innovations have begun finding a foothold in the UK market in recent years. JTI has spearheaded the entrance of heated tobacco products into the UK, launching its Ploom heated tobacco device last year alongside four varieties of compatible tobacco sticks: Bronze, Sepia, Emerald and Purple. Currently available in and around London, JTI is looking at extending this more widely. Another tobacco product to gain a following in recent months is snus. Already a staple in Scandinavia, these packets of tobacco nestle against the gum where they impart flavour, sensation and nicotine. JTI’s Nordic Spirit line splits its offering between two flavours, menthol and fruit, and is currently experiencing rapid growth, according to the company. l

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Mr Wintermans

LOVES SUMMER Sales are up

already*

Stock up now for your summer sales

Visit us online to learn more

stgtrade.co.uk FOR THE INFORMATION OF TOBACCO TRADERS ONLY *Data source: IRI MarketPlace. Total market. Value sales. Half Corona. Time period: MAT TY ending w/e 18-04-2021

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In the September issue of Better Wholesaling Insight:

The ultimate guide to Christmas and other occasions: increase your success during these profitable periods • An in-depth look at the top-selling lines across key categories • A guide to all of the major occasions throughout the year • What wholesalers should be doing to prepare for profitable seasons

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For more information about Better Wholesaling Insight, please contact Simon Joseph on 020 7689 3363 Better Wholesaling Insight: stay informed and get ahead

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82% of consumers are unable to name a retailer doing a good job of reducing plastic waste*

To find out more, please call Simon Joseph on 020 7689 3363

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*Kantar

Newtrade Media is passionate about helping independent retailers to become more sustainable.

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