The online debate

Wholesalers quiz iTradeNetwork’s ALEX WALTERS on the barriers to e-commerce entry and engagement

Simon Hannah

managing director of Glasgow-based JW Filshill (Today’s Group member)

How do we accelerate the engagement of ecommerce usage with the older generation, who still do a lot of the ordering?

Statistics show that over the past few years there has been a significant increase in the number of ‘silver surfers’. Office for National Statistics data shows that in 2012, 61% of the 55-64 age group purchased online, which was a 26% increase from 2008.

If the ordering process is made simple, is well designed and proves to be more convenient than other alternatives, you will find people of all demographics are happy to purchase online.

Nikkita Mulchundani

retail club manager of London-based Imperial Cash & Carry (Today’s Group member) 

We stock thousands of SKUs – would setting them up on a click & collect platform be costly?

An advantage of developing your website with a specialist in food and drink is that they will be geared up to handle large numbers of SKUs. Many of our clients have up to 20,000 SKUs, and in most cases, thousands of different price files across their customer base, without it causing any problems whatsoever.

It is possible to offer various levels of integration, and each of these comes with different set-up costs, starting from as little as £1,500. The catalogues are always managed in the wholesaler’s ERP system and when a full integration is chosen, the system can be updated through an automated process
or an easy upload/download, manual option.

Would the increase in turnover justify the initial investment and ongoing costs?

Running a fully integrated ecommerce website means orders are taken and transferred seamlessly
into your ERP system, so there is no need to re-key. This should reduce the time that your staff spend on order-taking and administration, which reduces the resource and associated cost. Other administration tasks, such as sending invoices or other promotional material, also become quicker and cheaper to do online.

Have any wholesalers gone from a call/fax/email and collect system to a click & collect system? Has it resulted in incremental turnover or a higher net profit?

All the wholesalers and suppliers that we have worked with have gone through the journey of telesales, fax and email orders before arriving at online ordering – a combination generating more revenue whilst also reducing costs.

Our interactive ROI calculator at www.sellingjustgoteasier.com allows you to see the types of benefits you could see using your own data.

If a cash & carry customer doesn’t shop around the depot himself, he may not pick up additional items or make impulse purchases that are on display or promotion. That’s a big missed opportunity.

Online provides an excellent environment for offering promotional deals, displaying products and encouraging impulse purchasing. Using online to drive revenue is something that the big online retailers and supermarkets have been perfecting and a good e-commerce platform will provide you with the same opportunities. Developing a website that includes a dynamic range of promotional selling mechanics, such as link selling (‘You bought gin so why not also buy the tonic?’), recommended selling (‘Other customers also purchased…’) and the more familiar BOGOF and loyalty discounts, is proven to increase engagement and revenue.

Online really comes into its own as selling platform at the point of purchase, because the promotions engine is able to recognise what has been purchased and then offer reminders and encouragement based on the basket – for example: ‘You only need to purchase one more of X to qualify for the special offer price.’

Jamie Burke

founder of www.retailersaver.com (an online buying group for retailers) 

Do you opt for delivered, click & collect or a hybrid? How do you marry your pricing against this?

The answer to click & collect versus delivered really depends on what the customer’s account base requires. But providing a solution such as the Storefront, which caters for both scenarios, would be a sensible option. We’d suggest using a single platform to keep prices down and then using targeted content to differentiate the two areas.

In terms of marrying pricing, we would always work with the client to analyse the size and frequency of ordering and offer a commercial package suited to their needs.

Do you offer open pricing or gated? Many traditional wholesalers seem scared to death of what openness means to their businesses

All users log in with their own unique username and password – the pricing information is therefore confidential to each user. This is essential in the delivered wholesale environment where wholesalers usually have individual price files for each customer or customer band. It is then easily possible to host a ‘wholesale price list’ in the logged out environment if required.

Elit Rowland

editor of Better Wholesaling 

How can an ecommerce provider offer a solution for buying groups that can be tailored to the needs of different members?

We would recommend two different options for buying groups:
1) Create a central buying group website where the content of the logged-out group portal is managed by the buying group. The members’ customers would visit a logged-out version of the central portal and would then easily navigate and log in to their chosen individual wholesaler’s landing page. Each individual wholesaler’s website would carry its bespoke branding, content and products and would also control promotional and branding space.
2) The buying group could negotiate a central deal with the ecommerce provider on behalf of its members. The wholesale member would own and control both the logged out and logged in content and advertising space.

How can these members’ customers go to the website without going via the central buying group site, which can be confusing and may also list competitors’ details?

In the first option where the wholesaler’s website is part of a central portal, customers would need to go into a central portal to select the wholesaler. However, as long as the customers bookmark their chosen page, depending on their browsers and settings, they will be able to go back to their selected page. The individual wholesaler could also decide whether to add an online ordering link to its existing website or simply forward the URL to the e-commerce portal.

How can a wholesaler manage supply and demand with an ecommerce website? How much can you expect demand to go up when everything goes online?

Our statistics show that the average customer basket increases by 7% per customer as a result of moving from traditional ordering to online ordering. Delivered wholesalers tend to stick to their existing delivery slots so although the customer is given the convenience of ordering at any time of the day, it means that the wholesaler retains control of the supply. Collection can also be managed similarly so the customer is given a ‘time window’ when they can collect.

Steve Parfett

chairman of Stockport-based AG Parfett and Sons (Landmark member) 

What does the future of technology developments in wholesale look like?

The web turned 25 last month and things have come a long way over the years. Almost every aspect of life can be made more convenient online, from the sourcing news to buying groceries and booking a table at a restaurant.

With the rise of mobile, we also now have online access 24 hours a day in almost every conceivable location. B2B normally lags slightly behind the consumer world but we have already seen significant growth, with around 15% of orders placed are now from a mobile device.

Our Storefront e-commerce platform has been designed specifically around the supplier and wholesaler hospitality sector, and so is perfectly fit for purpose. We are consistently investing in the platform and launching new functionality, so it is very much a platform evolving to cater for the changing needs of the sector.

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Alex Walters is the European sales director of iTradeNetwork, the world’s leading provider of cloud-based e-commerce and purchasing technology to the hospitality, foodservice and retail industries. Globally, iTradeNetwork’s e-commerce systems process more than £150bn of commercial transactions, working with over 6,200 wholesale, distributor and operator partners. The company works with a range of wholesalers including 3663, Molson Coors, Matthew Clark and Cuisine de France.

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