Wholesalers operating “predominantly” on a delivered wholesale model are offering “great value” on crisps and snacks in comparison to cash and carry rivals.
Better Retailing analysed the RRP and wholesale pricing of the top 10 bestselling crisps and snacks, according to What to Stock data, across Booker, Bestway, Filshill, Abra Wholesale and Costcutter.
Wholesale expert David Gilroy said: “Filshill, who is predominantly delivered, offers the lowest wholesale pricing across the 10 products when you analyse the combined cost of single units, while Costcutter is also very competitive. Both offer great value given they are delivered wholesalers.”
Analysis of the six products with case sizes of 15 showed Filshill’s total wholesale cost came to £41.85, while Costcutter amounted to £48.60. The percentage difference between the wholesale costs at the cheapest and most expensive outlets was 23%.
Gilroy added Filshill also offered the highest cash profit per week on the products – 29.3% higher than Booker.
Confex managing director Tom Gittins said: “Delivered wholesalers operate on higher costs because they have to pay for transportation and delivery staff, but they also have to remain competitive. They’ve always operated on smaller margins than cash and carries.
“However, they’d be able to make back the margins because they potentially have more customers to deliver to. Cash and carries have limitations because retailers will only travel a certain distance to get to their closest wholesale depot. Delivered wholesalers can travel to retailers across the country.”
Gittins added delivered wholesalers such as Costcutter and Filshill also operate on a basket of goods per delivery.
“The analysis doesn’t include other products a retailer will add to their delivery. The closest comparison is a customer going into a supermarket for their shopping and asking the price of one product, but not considering the cost of another within their basket. The product with the price not being questioned is where the wholesaler will make back the additional margin.”
The analysis also found Doritos products were VAT-exempt.
Gilroy said: “This is something retailers should consider when they are making their orders.
“Doritos aren’t classed as a potato product, so are exempt from VAT. Wholesalers will normally add the total VAT to the retailer’s order later on the invoice, and not when the order is being put together. Retailers should factor this in when they’re calculating the potential return on their order.”