Stay agile to prosper
Confex’s Marketing and HR Director, Jess Douglas, delves into why convenience sector trends suggest wholesalers have to keep up to speed with key issues
Driven by mergers, acquisitions and evolving shopper expectations, the grocery retail industry is undergoing a revolution. And wholesalers should take note.
At the heart of the industry sits the shopper and so their ever-changing habits, attitudes, tastes and preferences are integral to all areas of the trade, from supplier to wholesaler. The trade has an increasing responsibility to stay ahead of future needs and be relevant.
One key driver is that consumers are now more socially conscious. More than 60% of under-35s believe the environment will be more important to them in the next 5 to 10 years. Therefore, the range of products that are on offer will need to change to meet these needs.
David Attenborough’s Blue Planet and Greta Thunberg have generated global awareness of the impact of single-use plastics and climate change. New opportunities, such as plastic-free aisles, package-free stores and alternative pack materials, allow consumers to actively make choices about the plastic put out in the world. Although it’s the brands’ responsibility to address plastic pollution concerns with appropriate end-of-life pack solutions, wholesalers are realising the importance of stocking environmentally friendly products.
Confex has seen its wholesalers fully support this and has been overwhelmed with the take-up of Naïve, a spring water in a 100% recyclable can. Our Green Wholesaler Award has also gone from strength to strength, showcasing wholesalers’ environmentally sustainable business practices.
We’re increasingly being told consumers are more time-pressed, health and socially conscious, and digitally engaged than ever before, so wholesalers are becoming more aware too. Alongside this, consumers are increasingly looking for new and innovative products.
Getting these products stocked in wholesalers’ warehouses is a tricky task – it’s a gamble for smaller wholesalers to stock new and unknown products. We see the role of the buying group as supporting suppliers to test new products and enabling our members to trial products risk-free. Confex now sends out a sample box of 10 new and exciting supplier SKUs each promotional period to 200 wholesalers.
Suppliers have the opportunity to put new products directly into wholesalers’ hands, along with any marketing literature. Confex Central Distribution staff operate a telesales call to each wholesaler to get feedback on the products with an Add to Order incentive. This helps suppliers to accelerate their NPD launch to react to both positive and negative feedback of new products, while enabling members to have hands-on experience of the latest products on the market so they can offer their customers the most on-trend products.
Not only is the planet important but transparency is too. Consumers want to know what’s in products and their health benefits. For instance, being sugar-free is no longer a solution: shoppers want to know what the sugar has been replaced with.
Thanks to this stance, smaller brands are growing in customer loyalty over and above the established brands, so are experiencing more opportunity in the marketplace. For example, Sainsbury’s has created an innovation team that list in-demand smaller brands. Products are healthier, lower-sugar and tend to have a positive impact on both health in society and the planet.
Wholesale can react in a faster way to the needs of shoppers as they don’t have the same listing windows as grocers. Wholesalers and cash and carries are perfectly positioned to react to trends and support some of the smaller brands, be that regionally or nationally.
IGD predicts convenience will continue to grow ahead of the total market, hence why the multiples are focusing on this area. But we shouldn’t be complacent that the market and trends won’t change. Suppliers and wholesalers that adapt are the ones that will succeed.