Bestway Wholesale has introduced a new, revamped version of its own label range called Best-in, aiming to provide quality and value to both retailers and consumers.
The range will give retailers a minimum margin of 30% with some lines a whopping 75%.
It will be available to all the group’s customer base, regardless of the fascia above the door.
Kenton Burchell, Group Trading Director at Bestway Wholesale, tells Wholesale Manager more about the range and about what are the biggest trends in grocery.
Where have you worked before and in what roles have you worked?
I have been in this role for the last five years. I lead the trading and marketing teams across the Bestway Group. Prior to that I was leading the trading, marketing and logistics at what was Conviviality, which is now our Bestway Retail business. I was there for about five years. Prior to that I was trading director at what was Musgrave Retail Partners, which is now Booker Retail Partners, so I was leading the Budgens and Londis brands. I was in that role for three years at Musgrave. Before that I was in most of the roles you would think of in a trading department. I was originally a stock controller in Musgrave, then I was a buyer and I went through lots of different categories, then through category controller to trading director. I started my career pushing trollies and filling up shelves on a Saturday for a bit of pocket money so that’s probably where I picked up the retail bug. That was at a very old brand called Norman’s Super Warehouses, which was a bit like the Aldi of today.
What does your current role involve?
I lead the trading and marketing teams department across the Bestway Group. It’s an absolute privilege to lead our team. We have five centres of excellence. A team in Park Royal lead our cash & carry offer, mainly for our collect customers, we have some delivered but it’s mainly cash & carry. A team in Fenton lead our Bargain Booze & Wine Rack off-licence formats. A team in York lead our Costcutter and best-one convenience format. A team in Huddersfield lead our pet business – we are the largest pet specialist wholesaler in the UK. I have got a team split between London and Newcastle who lead our catering business. My role is leading those teams to produce the best offer for each of our different customer types, to make sure we have got the best pricing for Bestway but also for our retailers and that we are communicating that in the right way to help our retailers drive footfall, grow their sales and profit.
What are your goals for what you want to achieve in the role?
My compass is how do I help our teams that are directed towards our different customer types both enjoy what they do but also fulfil their potential in creating the best possible offer to our different customer types. That’s assortment, pricing and promotion. It’s making sure the customer, whether they are a retailer, a caterer or a pet store, have got the right offer for them to win. When our customer wins, then Bestway wins.
How would you describe Bestway for anyone who hasn’t heard of the business?
Bestway is the largest independent wholesaler in Great Britain. We operate across most of the postcodes in Great Britain – from Scotland all the way down to Cornwall and east to west. We provide our customers through convenience retail, off-licence, pet and catering with the best possible offer they could want to succeed in their businesses. We service up to 100,000 customers, made up of all those different customer types. If you look at the independent retailers in this country, of which there is about 45,000, we are providing most of those retailers with the offer they need to sell in their stores.
How is Bestway performing as a business?
We are doing very well, we have spent the last few years transforming the business in lots of different ways and being more efficient. We have all experienced inflation in terms of the cost of doing business. We have managed to mitigate the vast majority of that inflation to avoid passing that on to our customers. Supporting independent retailers is in our DNA, that’s what we do and therefore we want to protect them from that inflation in terms of the cost of doing business as much as we can.
If we look back to 2020, when the pandemic hit, the independent retailer was the cornerstone of their community, over the last 4 years we have built some really good momentum, making sure the independent retailer comes first in our thinking. If you look at the wholesale sector, we are performing ahead of the market based on the industry insight we get.
Which is the bigger side of your business, the retail or the foodservice?
The retail convenience part of the business is bigger than catering, especially after the aquisition of Costcutter 3 years ago. We clearly want to grow both. If we look at retail, it’s more diverse. We have got symbol retailers, Costcutter and best-one. We have got our off-licence retailers, Bargain Booze and Wine Rack. Then we have got 40,000 truly independent unaffiliated retailers that we supply. It’s a really diverse retail business we have got. We also have around 200 of our own corporately owned stores. We are experiencing what the independent retailers are experiencing. That helps us to be really in tune with what the independent retailer needs. We can run pilots in our in our own stores what we think would help independent retailers to succeed so that they don’t have to take the risk.
In which areas of the country are you strongest?
For catering, we are stronger in the north. That’s where the catering business grew originally. We also made an acquisition of the Batley’s business 20 years ago. We are truly national in terms of convenience. We have concentrations of convenience stores in the big cities – London, Manchester and Birmingham. That’s where the market is and we go where the market is.
Do you have an e-commerce site for your customers?
Yes. Our mantra is we want to make sure we have the right offer for each of our different customer types. That also means we want to have the right engagement for each of those different customers. We have a website we provide to our best-one retailers they use, not only for information in terms of the latest trends in the categories but also to place their orders. We also provide our customers with an app. From an e-commerce point of view, we are quite advanced. Our Xtra Local and unaffiliated retailers also have access to our website where they can place their orders. Our catering and on-trade customers can also place their orders via an app or via their website. We also provide them with a telesales operation. We are finding more retailers are moving over to e-commerce as the world moves on and they become more familiar with technology.
We have got four different types of convenience retailers, in terms of the way they want to place their orders. Some of our retailers want to use their EPOS systems. In their store for sales-based ordering, the technology is really smart, so it will know what stock they have got in-store and it will suggest an order to them, including promotions. They will place the order in-store, so they won’t go onto a website to do that. Then you have got a second retailer who would rather go through an e-commerce journey and place their order online or through the app. That would be based on their sales records and stockholding, but they also want to have a bit more of a shopping experience, as a consumer would.
Then you have got a retailer who will do some of their orders online and they will also want to top up in-depot. They want a bit of both, they want to come and see in the depot what deals they can get but also what ranges they might not have seen online, they want more of a physical experience.
Then we have got a whole bunch of retailers who would rather just shop in person and they don’t want to engage online. That’s more the unaffiliated retailers who are not part of our symbol groups that are on that journey still. They may get to that point where they become symbol retailers where they will want to focus more on the inventory, the merchandising, the range, how they lay it out and the customer service, rather than going into the cash & carry to access some of the key promotions and deals.
How are your own label ranges performing?
It goes back to what Bestway are really focused on to support our independent retailers to succeed. We know that there is a cost-of-living crisis. We know the multiple retailers have been growing their sales on own brand, as consumers want to access better value. There is obviously a quality question there as well. We have taken a look at our own brand and relaunched it under the Best-in brand. Our mantra is we want to make sure we provide value to the retailer so they can make a minimum of 30% margin. But that margin goes up to over 70% on some of the range. We want to make it really attractive to retailers and support their profitability.
Secondly, we want to make sure we provide value to the consumer so we have managed to find a way of getting products to be really good quality but also to be a very good price so the round pound would be a good example. We have got things like pasta at a pound, 4-roll toilet roll at a pound so the quality is good and the price point is also really good for the consumer.
The third thing is the quality benchmark. We have compared our own brand with branded alternatives and also other retailers’ own brands such as the supermarket own brands. Our pasta as an example is made of 100% durum wheat and we have still managed to get to around a £1 price point on that pasta.
Those three things are really important. We have got around 200 products in the range now under Best-in. We want to get to 300 in the next 12 months and that excludes the work we are doing in fresh and frozen to improve not only the own brand in fresh and frozen but also to convert our own brand into Best-in across fresh and frozen. It’s very exciting and clearly a stand-out for the consumer.
Why have we chosen Best-in? We did have an own brand range under best-one. But a lot of our retailers who shop with us might be Spar retailers, or Londis retailers for example, there are other symbol groups as well as independent retailers. So we wanted to have a brand that the retailer could feel comfortable about having in their store, regardless of the fascia above the store. A consumer could come in, they won’t see a best-in fascia above any store but when they access the best-in products in-store, it feels comfortable.
How is the Bestway Vans Direct business performing?
The Bestway Vans Direct business is going from strength to strength. The thing we do incredibly well with that business is the customer engagement. Because our van operators know the vast majority of their customers and visit them on a very regular basis, they build a relationship. They are there to either help the retailer replenish stocks or to hear about the latest trends, new lines and to upsell to the retailer to help them sell more to their consumers. It’s that relationship which makes a huge difference, it’s not a cold call, it’s a relationship. There is a trust in that relationship. It’s one of the best performing parts of our business. We are also doing a trial on some of the vans now with some alcohol. Obviously we want to sell to our retailers but the thing we lead with is the relationship. The vans have all got technology where they can see the history of the sales, they can see what that retailer has bought in the past. So they can also then understand very easily what motivates the retailer and what might be a lapsed purchase from a couple of months ago. They might have gone out of stock somehow and lost it on the fixture, and the van driver can help them regain that distribution.
What are the biggest trends in grocery at the moment?
Health is still definitely a trend and I think it will continue to be a trend. As younger consumers have access to far better information than consumers would have done 20 years ago, mainly because of their hand-held devices and social media, we are seeing those health trends play quite a big role.
Also, energy still continues to grow, that’s one of the big growth areas in the business. Mainly energy drinks but also protein clearly is a big growth area. That is being driven by better information on social media. People talk about the number of grams of protein in products in their meal last night.
NPD is having a big resurgence in 2024. If I look at the disruption over the last 3 years, clearly there has been NPD, but we have the disruption of the pandemic but also availability and supply chain challenges. We have delivered some of the most successful NPD the last few years. You have got to decide which horses you want to back, but we have seen amazing launches of Coke Lemon, Blucozade, Monster Bad Apple. I don’t think it’s a quantity play, I think it’s about what is the right NPD to get behind. The consumer just wants a bit of excitement in these categories, as well as seeing the new entries of the latest protein products etc. There are now protein shakes, protein yogurts. There is definitely more of that NPD coming out but the big NPD is going to make a bigger difference to the retailer and is probably going to be around for a while, like Coke Lemon.
Reformulation is something we have seen a lot of in the last few years. KP have done a very good job, they have reformulated a lot of products from an HFSS point of view. But they haven’t compromised the quality of the product and the size of the bag is maintained. Skips are quoting a 76 calorie bag, clearly that is in tune with the consumer as well these days.
How has the wholesale industry changed in recent years?
Firstly, there has been consolidation. We have seen that across the industry. The wholesalers that are around today have been around for a while, but there are less of them. The other thing that is starting to happen is wholesalers are spending more time on trying to help independent retailers stock the right range. Rather than it just being an emporium of range, the right range has become more important, having a more efficient range for the wholesaler and the independent retailer is more important. We want the retailers to stock the right products, not to stock everything because obviously if they stock everything their cash flow will be under pressure. We want to help them stock the right products that are relevant to the market to help accelerate their sales, for them to make more money. Bestway help them with their category management, that’s online as well as physically. But equally, we are choosing not to stock every product. The most forward thinking wholesalers are being more discerning about the range they stock. You have also got to give the retailer a choice. It’s not a supermarket play. This is about helping the independent retailer still have choice and adapt their range to their local community but also to help them stock the right products and not give them a huge emporium of products which are not going to sell for them.
The other thing I have seen in the wholesale sector is the desire for more efficiency. Who can help suppliers get the widest route to market the quickest? NPD would be an example, distribution points, who can be the best. The bar is continuously raised. But I think there is an efficiency play in terms of volumes and linking back to ESG agendas, how do you take rubber and oil off the roads? How do you service the network of independent retailers more efficiently? As the market consolidates, we are all supplying the 45,000 independent retailers that are out there in the market. We think we are up above 40,000 of those retailers. There is an efficiency play here to consolidate more of the volume through fewer wholesalers, and Bestway should be the first choice for manufacturers and independent retailers.
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