Confectionery wholesalers are diversifying into the soft drink, grocery, health and household categories, as buying group Sugro is encouraging them to look beyond impulse.
The firm’s new managing director, Emma Senior, who joined from Mondelez International in July last year, told Better Retailing the decision was driven by a crowded confectionery market.
She added: “We started off very much as a confectionery buying group. Snacks and soft drinks came into play and now we’ve opened up into grocery as well. We’re doing quite a lot now.
“We’re speaking to suppliers and feeding more and more of them to our members. Confectionery is quite a saturated market. For us to grow, we have to be careful that we’re not just focusing on confectionery.
“There’s only so much chocolate that people want. We’re also seeing that request from members as well, where they’re asking if we can offer them more than just confectionery. They’ve seen growth and demand from other categories.
“What we want in time is for our members to buy from us. They don’t have to go to different places, but it takes time to take on a lot of new suppliers.”
Sugro currently has 90 wholesalers among its membership, with a large proportion serving independent retailers.
Notable members include Forrest Fresh Foods and Rayburn Trading, which have also expanded their ranges from confectionery to offer household, alcohol and soft drinks.
Sugro has also been helping its members develop the online service available to their retailers, which include notifications of promotions and availability through instant messaging services such as WhatsApp.
Senior said: “We’re not the biggest buying group, but we’ve really been pushing the agenda [on technology].
“WhatsApp is a tool our wholesalers can use to talk to their own customers, but it also gives suppliers an opportunity to tell them about their products.
“We’ve also got an app which our members can offer to their own customers to order through them. It can be used on a phone or a computer. It’s had quite a good launch and we’ve got a steady flow of wholesalers coming on board.”
Although the buying group is diversifying its range, Senior added that confectionery is still a major part of its business.
Due to squeezed margins, major impulse brands have increased the £1 price-mark to £1.25 on many popular lines.
However, Senior told Better Retailing that the wholesaler had not noticed a “fallout” from customers. “People do have squeezed incomes, but they are still happy to pay a little bit more for a treat,” she said.
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