“To pivot or not to pivot” – Mannion weighs up wholesalers’ options
As B2B wholesalers continue their voyage into straight-to-consumer services, RNF and b2b.store CEO Rob Mannion explains how they can be a success
When Covid-19 began making its presence felt in the UK earlier this year, it created a tale of two sectors within wholesale. On one hand, grocery wholesalers couldn’t keep up with demand and on the other, foodservice wholesalers found themselves with stock sitting in depots as demand from the leisure industry dropped to zero almost overnight. As a result, several wholesalers pivoted their business models, selling directly to consumers and matching their own over-supply with rampant consumer demand.
The approach provided a financial lifeline for some but hasn’t been a silver bullet for all. So, as restrictions begin to lift, should traditional B2B suppliers continue with their forays into B2C markets and what lessons can we learn from their experiences so far?
The first thing to remember is that, while restrictions are lifting, the leisure industry is operating at a vastly reduced capacity. With the public still to be entirely convinced it’s safe to visit leisure destinations and eat out, demand for foodservice wholesalers is likely to remain below usual levels for many months. Add to that the threat of a potential second wave later this year and for those wholesalers that created B2C channels, it makes sense to keep these going – at least in the short term – running in tandem with their traditional business model.
Over the past few months, location, product range and government guidelines have all had a part to play in the success – or otherwise – of wholesalers making these changes. For example, drinks have proved easier to sell to consumers in larger quantities than food and wholesalers based in remote locations have done better than those in more populated locations. While we won’t see the return of mass-catering events any time soon, the change of guidance around family events means wholesalers that can tailor packages to new consumer groups (eg families planning weddings) could take advantage of emerging markets. Digital technology has played a key role in enabling wholesalers to pivot their business models and get word out to new markets quickly.
While growing sales have proved the value of ordering apps to wholesale over recent years, they have truly come into their own during the pandemic, supporting wholesalers to continue trading when staff are off sick, as well as the creation of new services such as click and collect. However, most of these apps have been designed with B2B customers in mind, so it’s important to remember they’ll need tweaking to suit B2C markets.
For example, B2B apps often contain sensitive commercial information they want to share with customers. Selling direct to customers means that information effectively becomes public, so it may be wiser to create a separate app, tailored for a consumer audience. Thankfully, with the recent launch of b2b.store, this is now quick, easy and free to do for wholesalers.
Standalone B2C apps could also be designed to facilitate other more B2C-focused services, such as home delivery, click and collect and AI-driven customer services, allowing wholesalers to respond to queries in a time and manner more suitable for consumer markets.
We all hope the next few months will see the country move towards a more normal way of life but, whatever the next year holds, it will be those wholesalers capable of pivoting their businesses quickly and taking advantage of new opportunities as they arise, that are most likely to thrive.
Read more from September’s edition of Wholesale News for free in our Read Now section.b2b.store coronavirus covid-19 e-commerce RNF Rob Mannion wholesale