Nick Shanagher reveals the eight things he learned from Abra Wholesale that can help smaller wholesalers to thrive
The contrast between Abra Wholesale’s shabby building in Edmonton, North London, and the vast shed I passed on the way that houses the Bestway depot tells a story.
Today, Abra is at the hard-scrabbling roots of a journey that Bestway’s founders would recognise from when they started up in Acton 42 years ago.
I have an appointment with Craig O’Connor, the recently appointed managing director of Abra, who will be responsible for the next stage of the company’s journey to success.
I am joining the company as it celebrates its 15th birthday, and Abra’s founder, Dee Thaya, is on hand to share some of the reasons why independent, smaller wholesalers can continue to thrive. Here are eight things I learned from my visit:
1. Like many founders of wholesalers, Thaya is a former retailer, and has a buyer’s eye for a great deal and a product that can shift volume. Abra grew its sales by 18% to £44m last year on the back of a diversification into tobacco and alcohol that started just four years earlier. The gap in the market he spotted was for smaller outer sizes – breaking down cartons of 10- or 20-cigarette packs into five-packs so cash-strapped retailers could get the range they needed without tying up too much capital.
2. Thaya is the figurehead of his business and is known by customers, who have his number on their phones and are co-members of various WhatsApp groups.
However, to ensure customers get a great experience, Abra is having to improve its discipline, from getting the promotional deals properly organised in-store to adding on new offers, including fresh and frozen. This is the job for which O’Connor and new operations and trading controller Brian Miller are responsible.
3. Behind the unimposing façade of Abra is 70,000sq ft of products ranging from the pound ranges, with which Thaya made his start, to newer lines like protein confectionery.
“For our customers we were the first to offer protein,” Miller tells me. O’Connor repeats the claim, saying Abra introduced the range about 14 months ago.
I look doubtful. “I am sure,” I say, “we were writing about protein long before that.” They agree, but claim no wholesalers were making it available for independent retailers.
4. One particular area of focus is the Abra app, which is driving retailer retention and rate of purchase. O’Connor shows off its push notifications, which present up to five offers in an easy, swipeable format. App users are more loyal and spend more, he says.
5. Abra offers deals 52 weeks a year on top of the 13 promotions from its buying group, Landmark. The company’s birthday offer is planned to last for 15 weeks and the booklet for week one included a major promotion with spirits brand Beam Suntory.
6. O’Connor is confident there is a great future for independent retailers and wholesalers. One piece of evidence he offers is that Abra’s sales of PepsiCo’s Walkers snacks are up 88% year-on-year in the first quarter.
7. Thaya believes that one of the ways in which new wholesalers can compete with the national and regional giants is to constantly search for the next big thing to make it available for independent retailers. He says the key to SMEs succeeding in FMCG wholesaleis to find the products that come next or meet the needs retailers have outside the core ranges.
8. O’Connor promises a big move in vaping shortly. He will not be drawn on what it is, but his message to retailers is: “Vapers are like craft beer lovers.” Sounds like opportunity.