The multiples are struggling. Bill Laird tells Better Wholesaling what the channel can do to pull ahead of them before they can recover.
BW: You are MD of the Today’s Group. What do you know about the day-to-day life of a wholesaler’s typical customer – for example, retailing on the shop floor or running a pub?
BL: When I joined Today’s Group as MD in early 2009, I made no secret of the fact that I was first and foremost a retailer. This has given me an essential additional perspective managing Today’s as I am not institutionalised nor are my experiences the product of a single sector.
My exposure started in my early teenage years in the 70s when I worked in our family convenience store. It was a hard job, even in those days, and we didn’t have the benefit of the most basic technology we take for granted now, such as electronic point-of-sale, stock management and PCs.
By coincidence (or fate), I got into retail as a career choice a few years later, learning at the sharp end, doing every job in the store, from washing floors and taking in deliveries to working the night shift and chasing shoplifters down the street!
During my time, I have been fortunate to work with and learn from some of the very best known UK retailers in large and small format, food and non-food/DIY. While I regard it as an extremely tough and demanding industry, I have also hugely enjoyed every experience (although not always at the time!) and I believe it is quite possibly the best grounding in people-management you can get.
Along the way, I also bought and managed a pub in the north-west of England for a couple of years. It was long hours, ultra-competitive, interesting customers and, at times, great fun.
What is the main opportunity for wholesalers in 2015?
Those focused on retail should ensure availability, ranging, promotions and retailer support services are 100%, all the time.
This is a great time to be in the convenience sector, given the current performance of the mainstream multiples. Those wholesalers that exploit this will lock in customer loyalty for the long-term.
In foodservice, it’s about differentiation from the main national players. Regional operators have a unique opportunity to excel at customer service. They may know their main customers and users by name and may also have relatively long-standing relationships with them.
Price is not the only way to retain loyalty, although I appreciate it’s an attention-grabber at times. But just as important are consistency of supply, timely deliveries, flexibility to go the extra mile, and reps and telesales teams who are interested in and know their customers.
How do you think independent convenience store retailers will fare in 2015?
Things are tough, no doubt about it. Independent retailers face big competition. You have to be smart to thrive and should take each day as an opportunity to do something a little better than yesterday. It’s also good to occasionally stand back and look at your store as a ‘critical customer’. That way, you get ahead of small problems before they become big issues.
The right advice matters. That’s what we’re about. We want to give independent retailers honest information and tools they can use. Our promotions are among the best in the industry. Our point-of-sale material jumps out from the shelves. This kind of help really makes a difference to independents.
How can wholesalers’ independent retail customers compete with Tesco and the multiples?
We read daily about the difficulties and poor performances of the best known multiples – and we don’t mind seeing some bloody noses on the competition – but we mock them at our peril. They will get better, but in the meantime, independents have a unique opportunity to really ensure their customers’ loyalty.
Independent retailers need to believe they can trade against the big players. When you’re part of Today’s Group, you can get real support and tools to help you compete.
What is the biggest risk for wholesalers currently?
Complacency – customers have the option to spend their money elsewhere, so regular reviews of in-depot service standards, product availability, promotions and maintaining a relevant core range are all must-dos. Simply doing what you’ve always done will no longer be good enough.
What’s the best advice you’d give a wholesaler this year?
Seek feedback from core customers to ensure you are staying relevant to their needs. Invest in technology to be ‘open’ 24/7 – customers are increasingly choosing to buy when it is convenient for them and this doesn’t have to be just during depot trading hours. Make the depot environment interesting and engaging. Create moments of interruption to bring new products or services to the attention of your customers.
How important are own-brand lines in wholesale?
Extremely – the growing influence of players, such as Aldi and Lidl, that do not
depend on mainstream brands makes it clear that own-label has become far more accepted in the minds and purchasing habits of consumers. However, they also demand great prices and comparable quality.
What’s the most significant thing Today’s Group is doing in 2015 to help the wholesale channel?
We are continuing to develop our technology platforms to ensure we support our members and supplier partners in as many ways as we can. This improves efficiency, speeds up communications and reduces the cost of doing business. Our in-house services functions, such as retail format development, marketing and business development network, mean we can deliver such support centrally, negating the need for our members to make local costly additional investments in this expertise themselves.
We are constantly extending our reach across the independent wholesale sector and a practical example of this is the recent large-scale expansion of our on-trade division. We now operate within every key category of the entire sector. Our range of members and their locations mean we have a truly national network of wholesalers and this capability will become increasingly important in the coming years.
How well is the independent retail channel competing against the multiples?
The channel is holding up well and is achieving genuine year-on-year growth – and industry bodies predict this will continue for the next few years at least.
Wholesalers are playing their critical role of working hard and investing heavily to meet the ongoing needs of their core customers.
The level of capability among ambitious independent retailers is growing and this is crucial to the channel’s long-term health and sustainability.
These retailers in particular know the value of becoming affiliated to a progressive and supportive symbol or fascia group and they take full advantage of the range and depth of services available to them. They don’t consider it a sacrifice of autonomy or independence.
All of this is great news for our wholesalers and suppliers, as successful retailers fuel the demand at all levels of the supply chain.