Last month, delivered wholesaler Palmer & Harvey announced a new supply partnership with Conviviality Retail. An initial two year agreement will see Conviviality supply P&H’s national distribution centre with alcohol, while P&H will supply tobacco to Conviviality.
Retail Express spoke to Martyn Ward, managing director of P&H, about the new supply deal.
Q: How will the deal benefit P&H and its customers?
A: If you look at the two businesses’ respective skill sets, both are leaders in their own rights.
When we started the conversation it quickly became clear that while we have a level of knowledge and expertise on tobacco that is second to none, Conviviality has the same on alcohol. By exchanging those complementary skillsets, we can give our customers a much better opportunity to compete on two crucial footfall driving categories.
Q: Is it an equal trade-off?
A: Yes – neither side feels that they’re getting any more or less out of it.
While tobacco is in decline, it’s still a significant footfall driver and cash flow generator.
The benefit comes from benefiting our customers. We’re two very like-minded businesses; we both want to push to improve what we’re giving our customers and franchisees, so the partnership is really jointly beneficial.
Hopefully there’s more to come from this completely new relationship – we’re both excited about it.
Q: Will you be able to use the partnership to clamp down on the illicit trade?
A: We’re constantly looking at how to clamp down on the illicit trade of both tobacco and alcohol.
That covers everything from counterfeit products to non-duty-paid products. We’re exceptionally focused on making sure everyone does as much as they can to tackle the issue, so we work closely with industry bodies and our customers. We’ll do the same with Conviviality by looking into how we can improve both of our work on tackling the issue.
We’re very much on top of it – when we form new relationships, we make sure they are buying from reputable sources. Both Palmer & Harvey and Conviviality Retail are too big to risk being non-compliant in any way. We need to eliminate the illicit trade to ensure a level playing field.
Q: Where will the partnership go in future?
A: Currently, our main focus is sharing our expertise to see what benefits the partnership can bring to our customers and franchisees.
When that’s done, we’ll be able to work out what our next step will be. We’re incredibly excited about what can be achieved, but we need to make sure our customers’ services are absolutely protected before we consider any further stages.
Q: Do you have any other partnerships in the pipeline?
A: This is certainly not a one off for us.
Within both P&H and Conviviality Retail, our job is to constantly look at improving our propositions so that we can pass the benefits on to retailers and consumers. Convenience retail is an incredibly difficult and competitive environment, so we need to stay ahead of the pack.
Some deals land, some won’t. We’ll only make one if we’re working with like-minded people and believe it can create a better offering for our customers and franchisees.