United Wholesale likes challenges – and plenty of them
Taking over a business while improving your main operation is no mean feat, but managing to keep many plates spinning at once is the key to United Wholesale’s success.
Last year, the business acquired the M9 depot in Falkirk, a 35,000sq ft site that turned over £20m a year and which will now trade as United M9.
“The move will allow us to deliver up to Dundee, which we don’t cover at the moment, so that’s a massive opportunity. There’s a huge potential to develop the Day Today and U-Save fascias. We’re confident we can grow the turnover to £30m,” explains Asim Sarwar, managing director of United Wholesale.
The first move for the business was to increase the depot’s range by 2,000 stock-keeping units. “There wasn’t any chilled, frozen or fresh so we’ve invested in a chilled room and freezers. They never used to sell bread but we’ve now got a full range of bread and cakes,” says Sarwar. This increase in ranges has stopped many customers going to the competition for missing lines.
“In the next couple of months we will be delivering chilled, frozen and fresh direct to store,” says Sarwar. The plan is to start with a fleet of five chilled vans and then scale up.
Taking on a new depot would be enough for most wholesalers, but United was not content with just one project. At its Queenslie depot, the business is investing just shy of £1m in the chilled and frozen side of the business as well.
Chilled is one of the fastest growing categories in the industry and the increasing prevalence of multiple convenience operators, which are particularly good at fresh and chilled, has made the area key for United.
“It’s something our stores are going to have to engage with or they’ll be left behind,” says Sarwar. United currently stocks about 150 chilled and frozen lines, but intends to stock 700 in the near future.
The company now takes all its orders digitally via electronic point-of-sale, web or the dedicated app that it launched in December. The orders come through as picking lists, which means the telesales teams do not need to process them so can instead focus on customer relations and upselling.
“It was a hard mission but the app was the final step. We had about 50 retailers who were still trying to phone or email in their orders so we got them in and bought them phones or convinced them to download the app,” explains Sarwar. Launching first on Android, the app will be extended to iOS users this month.
The move has allowed the business to save the cost of one member of the telesales team. “The minimum wage increase is our biggest challenge. We’re going to guarantee to our customers that we will not pass any of the cost to them.
Moving to online orders has taken out many of the human elements of processing the order, which has meant that mispicks are now at “virtually zero”. The picking system has also been made more efficient by adding a fast-pick area, which includes the top 300 lines that make up 80% of the sales.
Sarwar says: “We’re now looking to start picking products straight onto pallets. Before we would pack an order on the trolley, get it checked, then palletise it. Now we just put it straight on there.”
Moving to digital orders has also allowed United to collect and use data more effectively. “We’re about six months away from where we wanted to be. We want to tell customers things like the item most commonly purchased with a can of Coke, for example. We also want to know how much uplift products get on promotion and the best linked deals.”
Like many other wholesalers, United has made moves to save energy in its depots, installing LED lighting and temperature control. But thanks to its ‘United We Save’ programme, it has gone one step further than simply passing on the savings to its customers.
“We negotiate with electricity, gas and water suppliers and credit card companies to achieve a cheaper rate for our entire estate. We don’t just help our retailers make more money – we help them save money, too,” he explains.
Despite the impending challenges, United is continuing to invest in its team and continuing its march across Scotland. With 70% of its business now made up of its symbol group operators and 80 customers already on the waiting list, the benefits of Day Today and U-Save remain one of United’s most powerful weapons.
Sarwar concludes, “We don’t put fascias up for the sake of it. If we put one up and don’t grow their business, we’ve failed.