Wholesalers Improving their Online Experience

We have recently seen that wholesalers have started to improve their websites and online experience with new websites being launched over the last few months.

We first saw JJ Food Service with a newly improved website, closely followed by A to Z Catering and Nila has now launched their new website last week too. All the websites look much more slicker than before, with sharper photos and better user experience for the customers with an easy to use basket system.

Is this the way shape of things to come? We certainly think so and believe this has been long over due. Wholesale traditionally has been slow to adapt to the internet with user experiences we take for granted today, and we believe this adds momentum to purchasing online with the trips to the cash and carry becoming less and less frequent in the future.

Buying online has its advantages for the wholesalers. Firstly, there is less reliance on taking calls over the telephone, which means employing less staff in the call centre. Additionally, the orders are more accurate online as the user has put their own order into the system which equates to fewer incorrect orders.

Additionally, with more orders made online rather than customers coming into the store, less space is required for the depot and hence money can be saved in rent if the business.  For a lot of wholesalers, the land is bought freehold and so this doesn’t make such a big difference apart maintenance costs can be reduced as a result.

Once the wholesaler is online then there is the new task of attracting customers to the site. This involves SEO, optimising the site and conversion rates, as well as not losing any customers prior to the purchasing phase. This is a completely new area for the wholesaler and we recommend seeking expert advice in this.

It is great to see that the wholesale market is moving online with enhanced user experiences and we look forward to further advances in the near future too.

Food Suppliers Fear of Being Bullied by Supermarkets

Christine Tacon, the Groceries Code Adjudicator told peers yesterday that the watchdog had found it difficult to get suppliers to come forward with evidence of breaches of code of practices.

Thus, it appears as though the suppliers are all scared of being black listed and facing a potential loss of business if they tell about the current business practices implemented by the supermarkets. This has been further evidenced by the YouGov poll that says that 58% of suppliers feared retribution from the supermarkets.

Does this happen in the wholesale industry too? And if so, what can be done about it?

Typically, there is more competition in the consumer grocery business from the supermarkets than in the wholesale industry. The main reason is that the size of all the wholesalers varies, from very small wholesalers to the largest which is Booker, with £4bn sales. This is predominately cash and carry goods which are all branded products and so part of big manufacturing companies anyway.

Smaller food suppliers who supply the catering distribution companies like 3663, Brakes, Fresh Direct etc are squeezed on prices, but the products get absorbed into restaurant, café food etc and so the prices are not advertised nationally. The end consumer does not get to see the prices of tomatoes, cucumbers etc. and only sees the prices of the sandwiches, baguettes etc. which makes it less transparent. Hence, there is not a big price war on the supplier side.

Thus, we do not anticipate a similar supplier squeeze to the supermarkets in the wholesaler industry and although suppliers will be squeezed to some extent, but not to the extent of that being faced by the supermarkets.

Food Companies at Risk of Collapse – Impact on Wholesaler Market

It’s no secret that the number of food companies at risk of collapse has gone up over the last few months. Indeed, Begbies Traynor, insolvency specialists have reported that the number of food companies at risk of insolvency has risen from 2,878 in 2013 to 4,550  in 2014.

This is largely due to the pressures put on them by the supermarkets as the supermarkets in turn face competition from the discounters. Thus, it is inevitable that some will not survive, and this is happening all too swiftly in today’s very competitive market.

What kind of affect can this have on the wholesale and foodservice market? Well, for a start the foodservice and wholesalers are buying their fruit, vegetable and dairy product supplies from the farmers and food suppliers who are receiving less and less revenue from the supermarkets. Without covering their costs, their will in turn collapse and with it, all the other businesses who they supply will be affected.

This means that with fewer suppliers, supply is reduced and the prices of the products will go up, affecting the wholesalers and the end customers too.

Additionally, with the collapse of many suppliers, the wholesalers will need to find alternative sources quickly and hence may need to go abroad to secure the right prices or look at more expensive alternatives at home. This may have an impact on the quality of the produce and the cost too. It’s a balancing act that needs to be correctly addressed as there is a knock on effect for all.

Wholesalers and food service distributors should have contingency plans in case this does happen, to ensure that their own service to the customer is not affected. We hope as many food suppliers as possible are able to survive, with the help of Government grants as the problem is not just for them, but the whole grocery industry as a whole.

Booker Reports Strong Growth in Sales – What is the Impact of this on the Wholesale Market?

Booker last week reported good sales growth over the  quarter, with Non-Tobacco like-for-like sales up 3.1 percent for the quarter. Sales growth for all stores including the Makro stores was 0.1% up on the same period last year, for the 12 weeks to 12th September 2014 – a pretty solid result.

However, Makro endured a 10.8% decline in its sales for the quarter, as it disposed of its unprofitable categories.

Shares in the company were up 4.5% to 121.5pence on morning on trading after the announcement and continue to trade well at 123.55 pence by the end of last week (26th September).

What does this mean for the wholesale market as a whole? Has Booker taken share from the other wholesale players? Or is this the result of real growth in the market, as a result of more convenience stores being opened?

The number of convenience stores, bars, restaurants, kitchens and caterers in this country has largely stayed consistent at around 450,000. There hasn’t been significant growth in the number of convenience stores which is the largest customer base of Booker and the largest part of the market with approximately 250,000 independent convenience stores in the UK today. Thus, the growth comes largely as a result of an improved offering which existing customers find very attractive.

The Makro acquisition has added sales to the Booker group, as well as enhanced synergies from added purchasing power etc. However, as it was already a loss making business before the acquisition, there is still a lot to do by reducing the categories which are loss making e.g. electrical, fashion etc. and so we can expect to see further improvements in profitability over the coming quarters too. By focusing on their core customer group and market lines Booker will be able to improve the supply chains in those areas.

By consistently delivering high levels of customer service and competitive pricing levels of promotions on the key product lines, Booker looks set to continue its strong performance under the leadership of Charles Wilson, Booker CEO.

ITP Analytics Launch

After many months of research, programming and data gathering, we launched the Improve That Price Analytics online reports. The report provides users with live data on the Foodservice Wholesale and Cash & Cary market. These reports can be viewed by category, brand or type. The data can also be filtered to show only the Price Marked, Promotions or the Multi-buys. The site also features the price history of products, is very user friendly and you can have a two weeks free trial at  improvethatprice.com/analytics. For further information email Faisal on faisal@improvethatprice.com.

Improve That Price Analytics

This week, after many months of research, programming and data gathering, we are launching the Improve That Price Analytics online reports.

The report provides users with live data on the Foodservice Wholesale and Cash & Cary market. These reports can be viewed by category, brand or type. The data can also be filtered to show only the Price Marked, Promotions or the Multi-buys.

The site also features the price history of products, is very user friendly and you can have a two weeks free trial at  improvethatprice.com/analytics.

If further information is required then please email Faisal on faisal@improvethatprice.com.

 

Improve That Price, in short.

Improve That Price was launched in January 2012.

It has three directors and the current team consists of five people split into programming, marketing, finance, data management and public relations.

There are 17,128 listed products and  this number is increasing daily.

On average users can save approximately 7%.

Improve That Price will shortly be launching its Analytics tool giving live price updates on all drink products helping the food service industry and manufactures understand pricing strategies of their customers.

Users can now track their favourite products and receive email alerts whenever the price drops.

Users can also leave a review for suppliers helping others users decide who to order from.

There is currently no other price comparison site for the catering industry.

There have been several articles written about Improve That Price http://improvethatprice.com/press.php.