With impulse purchases the epitome of summer sales, wholesalers have a big opportunity to cash in, writes LINDSAY SHARMAN
Even if March’s snow and winds made it seem as distant as ever, the long-awaited summer is almost here. And when the mercury eventually rises, so will demand for seasonal products like bottled water, ice cream and soft drinks. It’s a key trading period for wholesalers and their retail and foodservice customers – and one that depot managers need to get right.
“A good summer is more important than a good Christmas in wholesale,” says Mike McGee, director of The Whole Sale Company, a supplier of wholesale data. “Summer is when all the major activity to drive sales and income happens.”
One of the main factors in deciding the success of a summer is the weather. Sunshine drives impulse sales in retail, and encourages more eating and drinking occasions, boosting sales for those in the catering trade. With the weather in the UK notoriously unpredictable, being nimble enough to respond quickly isn’t always easy, but it’s essential for wholesalers wanting to make the most of the season.
7 WAYS TO GROW SUMMER SALES
- 1/ PLAN AHEAD: Map out an events calendar, including national and local events. Use it as a peg for promotions in-depot and as a way of encouraging customers to do the same.
- 2/ SUPPORT INNOVATION: Summer is a key time for product launches from the big suppliers. Get behind new products, especially if they’re supported with major marketing activity.
- 3/ IN DEPOT ACTIVITY: Work together with suppliers to bring promotions and new product to life in-depot – Bestway’s Park Royal enjoyed a 50% sales uplift after hosting a sampling day with Danone’s hula girls.
- 4/ BUILD RELATIONSHIPS: Take advantage of the good weather to meet customers. The PR value of face-to-face events is huge, driving customer loyalty as well as sales.
- 5/ GO LOCAL: Understanding the communities your customers serve will give you extra insight into the products they want. Your product range needs to be as diverse as your customers – and theirs.
- 6/ RIGHT RANGE: Stock products in the categories that perform well over the summer and cross-promote. Alcohol with snacks or burgers with paper plates, for example, will encourage additional sales.
- 7/ COMMUNICATE: Whether you use regular emails or promotional leaflets, keep your customers informed about what’s happening in-depot, from product launches to promotions and events.
“We have to check the weather all the time and it’s tricky getting it right,” says Bestway’s marketing director, David Gilroy. However, Gilroy says, wholesalers and their independent retail customers are in the best position to cash in on summer sales because a large proportion of these are made on impulse: “Weather has less of an impact on multiples because impulse sales come from walk-in business,” he says.
Successfully capturing impulse sales when the sun shines takes careful planning. Successful wholesalers have strategies in place to make sure they are ready the moment the heat is on.
JJ Food Service, for example, sends a weekly email to its customers promoting particular products as part of its regular marketing activity. Over the summer months, the focus of these promotions ranges from the obvious – water, soft drinks, ice cream – to products that lend themselves to their consumption, such as paper cups and plastic cutlery.
“It’s about having the right product, at the right price, at the right time,” says JJ Food Service general manager Terry Larkin. “A good summer is largely weather-dependent – if the sun shines, sales go up.”
That’s not to say a summer of poor weather has to mean a wash out when it comes to sales. Soft drinks, for
example, grew by 11% between May and August last year, despite it being the second wettest summer on record since 1912.
“Summer is a crucial time for the whole soft drinks industry, and even with low sunshine and high rainfall last year, there was growth,” says Guy Gissing, national impulse controller at AG Barr. “If we have a good summer this year, there will be significantly more.”
A further opportunity for wholesalers and their customers is the high number of national and international events that take place over the summer months, from major sporting occasions to music festivals. 2012 was a particularly fruitful year with the Olympics, the Queen’s Diamond Jubilee and the World Cup all lending themselves to promotion throughout the supply chain, from supplier to independent. This year is relatively quiet in comparison.
“2013 will be an interesting challenge,” says Mike McGee. “There’s not so much going on and so tourism will not be so affected, which is part of what drives impulse sales. It’s going to stretch the imagination of wholesalers and they will need to be more creative.”
In the absence of major national activity, focus is shifting to local level at both national and independent wholesalers. Bestway, for example, has a range of activity to be executed nationally, but marketing director David Gilroy says the importance of activity at branch level should not be underestimated.
“We have a national plan that is executed in all branches but there are a lot of local trade events that the local management organise, too.” Branch activity includes demonstrations and tasting events, particularly for catering customers.
“This is the time of year when a lot of caterers prepare for the new season, so it’s a good opportunity for wholesalers to communicate with them,” says Gilroy. “They like to get time out of their businesses and talk to other customers – and they like to touch and feel the merchandise.”
Holding events at the depot is not only an effective way to put products in front of your customers, it’s also a useful tool from a networking perspective. Events can be educational for both retail and wholesale customers and are also good opportunities for senior management to meet and interact with the customer base. East End Foods has been holding its annual barbecue for more than 15 years and it’s a fantastic profit driver as well as a social event.
Support from suppliers is another key component of a successful summer for wholesalers. Leading brands in the categories that profit most from summer sales get behind promotional activity in a big way, from launches of new products and sponsorship deals to depot-specific activity.
New products from soft drinks and alcohol suppliers are plentiful. CCE, for example, is re-introducing Vanilla Coke for the first time since 2003, as well as launching a 1.75l bottle across the range. Heineken is launching Fosters Radler, a refreshing drink timed to coincide with the summer, and two new Bulmers flavours: Bold Black Cherry and Pressed Red Grape.
As with wholesalers, suppliers also face the challenge presented by a lack of activity this year that they can use as a peg to hang promotions on. While there are still opportunities – Heineken is sponsoring the Champions League for example – other brands have to be more creative about how they get new products to consumers.
Some are realising the value of focusing on the wholesale channel to do so. Danone recently undertook a major piece of marketing activity for its Volvic Touch of Fruit brand, based solely in depots across the country.
The launch of Volvic Touch of Fruit Tropical involved three tiers of activity, ranging from ‘platinum’ activity in five depots that included sampling and ‘hula girls’ on-site, as well as point-of-sale material for retailers through to a smaller-scale version in a further 78 depots around the country. The activity took place throughout February and with impressive results, including a 50% sales uplift at Bestway’s Park Royal.
“We really needed to get the product trickled through to independents. I believe we can do an awful lot in a depot to get the retailers to understand what’s going on,” says Danone’s shopper strategy manager Averil Provan.“We hadn’t done anything like it before and it’s definitely a route we’ll go down in future.”
AG Barr is also encouraging depot-specific activity with a view to reaching its independent retail customers. May is ‘Mango Month’ and depot managers will be encouraged to promote not only the company’s Rubicon brand but also to link it to fruit to ‘bring the activity alive’.“Thinking locally is where we are coming from and we’ll be active in wholesale depots from mid-April,” says AG Barr’s Gissing.