Back to an old chestnut this week, and one that I believe will become more and more relevant over the next few years. For a number of retailers, suppliers and wholesalers I talk to, the fragmentation of supply to retailers within the speciality food sector remains their largest frustration. It is also holding back the sector in my opinion. I talked about this in my last piece when I compared this sector with the convenience sector, whose managers would very rarely buy any new brand unless it was listed with a wholesaler they were already dealing with. This last week I was reminded by someone that the health food sector is similar. Health food retailers “force” new brands to be listed with a wholesaler before they take them on. As a result both sectors are more mature and more efficient than the speciality food sector. It is time for us to grow up.
Many retailers would agree they have too many suppliers yet they often behave differently. It is only by working together that producers and wholesalers will encourage retailers to behave more in the way many of them need to and reduce the complication in their supply chain. Here are two examples of this, one positive and one negative, within the last week.
One of my sales team had a meeting with a large garden centre and showed them our new chilled range. There was one particular brand that they thought they could sell good volumes of. What was the first thing they did after the account manager left? Make a call to the chilled supplier and ask to buy direct! This supplier did the right thing and redirected them back to us, which made the retailer eat humble pie (not the product in question!)
The second example was another garden centre who ordered some other products from us as part of a larger order, who then decided they wanted to try and buy direct. This supplier did the wrong thing and supplied our customer without talking to us. It so happens that the sales person in this case is fairly new. Do you think they will push that brand again? Probably not – they will concentrate on selling products where they know the supplier is working with them – and not against them!
There is a need for more integrity here from both producers and retailers. I am a great believer in “what you sow you reap”, which is the biblical version of “karma”. Those that operate with integrity and honour will be those that profit in the future. Fortunately there are many that do exactly this in our sector, which is why I am actually not full of doom and gloom as I write this, but of hope and encouragement.
Have a great week!