Unfinished business

Alan Toft will soon leave the post of director general of the Federation of Wholesale Distributors, one of the old established high profile grocery trade associations with a proud unbroken heritage. Asked to write his own job specification when he joined FWD (after launching and editing Independent Grocer (now IRN) for eight years) he simply said that he would attempt to give wholesalers reasons to be proud of their trade, to walk tall and to be valued by suppliers. He launched a string of initiatives and events to draw suppliers’ attention to the importance of wholesaling, creating constructive debating platforms. And he launched ProWholesaler. But he is unhappy about some unfinished Features > Business, he says. In the jungle that is the grocery market there are some big beasts – and wholesaling is one of them – but sometimes it doesn’t quite realise it. For example, manufacturers rely on wholesalers to a greater extent than they will admit. It is impossible to get goods into local shops on any scale without the wholesaler. This means the wholesaler is the first customer, but does every supplier always work on the concept that this particular customer is king? Those who do run to about 20 in number.

Does the wholesale sector recognise its power and the sheer value of its interface with the independent retailer and caterer? Does it, in general, impose on the manufacturer the sense that the wholesaler is only working at his most efficient when all the elements in the relationship – price, communications, mutual understanding and respect, service levels and marketing support – are delivered in one package simultaneously and first time.

Many of the friends I have made during my time at FWD are manufacturers. They are just like you and me – cut them and they bleed. But there remain, in some areas, a few suppliers who are distant. They are not distant in market power but they are so in terms of feel, of the right touch. These suppliers miss out on their bottom lines. If there are closer ties between the supplier and the supplied after my 16 years of working to make wholesaling more important in the eyes of the manufacturing community, then that’s some success.

But how do you evaluate it? In the retail market, the local convenience sector which depends on wholesalers more or less completely is in good shape. So wholesalers should be happy. The threat from the superstore giants is a dark cloud, but there are many rays of sunshine which doggedly shine through. Do wholesalers shout loud enough about these rays? Or does the supplier only hear the sound of beating drums calling wholesalers to take up arms against the regulators, the government, the town planners and any other enemy real or imagined?

Are wholesalers volunteering for the front in such numbers and with such enthusiasm that they are overlooking their first duty which is to make money in order to become so much more efficient in performing the task they have been sent down to earth to carry out – to serve?

Will the Office of Fair Trading ever get round to producing a level playing field on which wholesalers, their customers, and the multiples can play a decent competitive game – one in which the players do not metaphorically use foul language, spit, Ferguson (the verb) the referee, pull the ball back after it’s over the line with a look of innocence, and so on. What do you think?

No regulator, no European Court or Commission will set out deliberately to apply restraint to any function which produces low prices for the consumer. It is, as one great and good wholesaler said, bleedin’ obvious that regulators are misguided. They do not appear to look at the medium or long term. Reflecting society today, they appear to work on the “now” principle because the nation is concerned with the now.

The House of Commons is where this issue will finally be solved. As in France, Parliamentary pressure will produce a moratorium on superstore acquisitions. It will happen.
Wholesalers are making themselves more indispensable and their retailers less vulnerable by making money for investment in marketing which will make them even more indispensable in the future – a virtuous circle if ever there was one. Which is why wholesalers need to tell the market, through their trade association, that they are proud people working in an industry which will invest, which will agree “shared goals” with suppliers.

Wholesalers are a tribe which needs to be seen to be independent in thought and action. The events which FWD mounts through the year are one way in which the industry specifically expresses itself as the link which is hugely influential in the market it serves.

It may come as a surprise to the general reader that some wholesalers do not seek preferential treatment from suppliers. They want to earn the terms which suppliers will give to those who deliver (in the general sense).

At one FWD inner cabinet meeting, a row broke out between one member, who piled abuse on the supplier community at large for not recognising the plight of the wholesaler. Another wholesaler told him that if he got his act together and delivered mutually agreed sales targets he would be earning his terms. Perhaps the banner for the future should read “Earning not yearning”.

Fighting for genuine independent retailer recognition is unfinished. What’s wrong is that the words “independent retailer” do not appear in the banners under which campaigns are currently being fought, yet independents form the core customer base of every wholesaler. In other words, the signals to regulators need more clarity and more focus on “independent”.

Wholesalers must also regain ownership of the guidance and advice given to retailers. There are signs of a resurgance in supplier marketing departments where bright young things produce planograms based on the brand ambitions of the boss. It could be back to the dark ages when so many independents were assisted to closure by planogram advice of nil integrity. Independents are wholesalers’ customers, not the suppliers’.
Unfinished business is a torment, it’s true. One such item is the Booker absence from the ranks of the Federation due completely to the policies of the old Big Food Group and its city manifestations

The new Booker has a place at the officially accredited FWD table where it can once again play its part in industry debates. Currently it has no say in forming wholesaler strategies on the impact of the new duty marked spirits products on stocks already held, new hygiene best-practice guidelines for wholesalers, and new wholesale traceability issues in the pipeline.

The Take Home Blueprint activity is never finished Features > Business, of course. It needs replenishment from wholesalers and suppliers to maintain its hugely beneficial effect on the total sector – the only planogram advice for retailers anywhere which carries a copper-bottomed guarantee of increased sales. Incredible!
And the My Shop Is Your Shop campaign, which for the first time calls consumer attention to the value of the independent retail to the community, is barely off the ground. It needs specific and careful nursing by an energetic FWD to grow into a national treasure and part of the wholesale industry’s proud heritage.

The penny is dropping in connection with National Independents’ Day, with a willing media on the side of the underdog. Wholesalers must jealously guard this activity – the commercial payback from the retailer will, given time, be a wholesaler bottom line contributor.

Wholesalers occupy a unique positioning to focus on the nourishing of independent retailers and caterers – sole traders and family businesses – without compromise. That’s where wholesalers’ business lies. It’s not charity – but it begins at home.

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