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Grocers Increase Investment in Wholesale
Two-thirds of the UK's grocery suppliers (68%) are devoting more resources to the wholesale sector this year than last year, according to survey results in Grocery Wholesaling 2004, a report by grocery industry think tank IGD. The value of the sector is forecast to grow to £17.6bn by the end of 2007.
Over 80% of suppliers agree that the wholesale sector provides an important vehicle for building brand penetration, and three quarters of these (61% of the total) believe that building strong and effective relationships with wholesalers is the most effective way to reach independents. More than a third (38%) see the wholesale sector as a sales generator for their business while 18% see it as a way to generate profit.
Nine out of 10 suppliers say that they are committed to investing in the wholesale sector and 80% operate a field sales force which visit individual depots. Most suppliers have separate strategies for cash & carry and delivered operators (69%), and for reaching retail and foodservice customers through wholesalers (70%). Nearly four in five (79%) say that the wholesale sector will still have a role to play in the supply of grocery products in 10 years' time.
Chief Executive Joanne Denney-Finch says the report illustrates that 'the wholesale sector may serve different functions in different categories but the fact remains that few suppliers can afford to ignore the sales, profit and distribution opportunities it offers'.
More information about IGD and Grocery Wholesaling 2004 is available at www.igd.com
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