As the year draws to a close, Wholesale Manager has looked ahead to try to estimate what will be the biggest trends influencing the wholesale sector in the year ahead.
Although the cost of living crisis remains a very challenging issue, the wholesale sector has the potential to give the UK economy the push needed to begin its recovery.
As the crisis continues, shoppers will become more savvy and will seek to find value in every shopping visit, a trend which could actually result in growth for the convenience sector.
The sector has continued to grow in 2023, a testament to the fact that consumers still love local shopping.
Consumers will be cooking at home more, purchasing less expensive supplies and seeking cost-effective solutions such as batch cooking.
Own label is becoming more important for retailers as they look to offer consumers great value while maintaining their own margin.
The home delivery market is continuing to develop and expand as more consumers take advantage of last-mile delivery.
The cost of living crisis is unlikely to deter from the trends towards health and wellness as consumers will still seek healthier options. Wholesalers can capitalise on this trend by stocking healthy snacks, protein products, vitamin-enriched waters and lower calorie meal options.
And there will be the big sporting events like the Olympics and Euros which are certain to get the tills ringing.
Foodservice wholesalers need not despair as nearly half of UK consumers claim to eat out of home once a week or more, according to CGA.
Consumers are focusing on the nutritional properties of food and drink with their physical and mental health and well-being in mind.
They are seeking out authentic dishes, drinks and cuisines that consumers can use to feed their sense of adventure.
Authentic, rustic charm is characterising stripped back décor and farm to fork, provenance-led menus.
Consumers are looking for dishes and drinks that really stimulate their senses visually, emotionally or through new, exciting flavour contrasts.
They also want the magic that happens when familiar British flavours and formats they know and love merge with exciting global dishes and cuisines.
Technology will continue to evolve. Wholesale businesses are investing in enhanced payment systems, customer portals, e-commerce features, personalisation or improvements in cybersecurity.
By using new technology, wholesalers can enhance their operations, improve customer satisfaction, and remain competitive in an ever-evolving marketplace.
Wholesale Manager asked wholesalers what they think will be the most important trends to emerge during 2024 and how wholesalers can best be prepared for the year ahead.
Pace of change
Catherine Hinchcliff, Head of Corporate Marketing and Insight at Bidfood, says technology will continue to evolve in the New Year.
What do you think will be the biggest emerging trends in wholesaling in 2024?
Certainly the pace of technology which improves the customer experience is a key factor which we expect will continue to accelerate in 2024. Whether that’s in enhanced payment systems, customer portals, e-commerce features, personalisation or improvements in cybersecurity, there are many different areas in which wholesale businesses are investing.
How is the cost of living crisis affecting the wholesale sector?
As we head into the New Year we hope that the bite of the cost of living may ease during the course of 2024, but for now it still remains a very challenging issue. The hospitality sector which we serve, as well as the wholesale sector along with food and drink suppliers which feed it, all present the opportunity to give the UK economy the big boost it needs to start its recovery. We know these sectors are quickly and easily able to mobilise to fuel economic growth in the UK.
What will be the key categories to watch out for?
One of the five trends we have identified for 2024 is ‘Let’s Play’, this trend is about new experiences, being out of the ordinary and providing the wow factor. People are looking for Instagrammable dishes or drinks, meals out that they can look forward to and remember, sprinkled with a little bit more excitement, theatre and novelty.
Mind, mood and body is another of our trends, focusing on how the food that we eat impacts our health and well-being. Protein is currently a growing focus area for consumers, and plant-based options such as beans, lentils and chickpeas are choices that have widespread appeal.
How can wholesalers best prepare for 2024?
As the cost of living crisis eases, the cost of borrowing crisis is set to kick-in which again, will impact on both consumer and businesses behaviour, so caution will remain a key theme for 2024.
There is also legislative and regulatory change set to come into play all the way through 2024 which the industry needs to be aware of and prepare for. This is mostly centred around sustainability, packaging and Brexit. The British Islands Address legislation is the first of these to come into force, starting up on January 1st 2024 and requires all products sold in the UK to have a British Islands address on the packaging (rather than an EU address).
Will wholesalers need to make better use of technology to survive?
Technology can help to overcome some of the challenges that wholesale is faced with currently, such as staff shortages and inflation. As technology continues to progress and evolve at such rapid rates, it will undoubtingly find solutions to these problems that the industry is currently being faced with. With this in mind, it is therefore crucial that wholesalers pay close attention to the developments in technology and invest in it now, so to be ready for the future.
Will consumers stay in more and will there consequently be more products aimed at in-home consumption?
No, consumers will continue to eat out, with nearly half of UK consumers claiming to eat out of home once a week or more. However, the manner in which they do this is set to change with value being the most important driver of menu and dish choice, and out of home occasions being seen as more of a treat or special occasion or eating out when they are ‘on the go’. To combat this, operators must try to increase spend and repeat visits by really enhancing these occasions, as well as offering great value.
Will healthy eating and wellness be even bigger trends in 2024?
Despite many out of home eating and drinking visits being ‘treat-led’ health and well-being will continue to be important to UK consumers in 2024. Whatever their age, consumers are recognising the importance of making healthier lifestyle choices both at home and when eating out. However, these lifestyle choices don’t just stop with their physical health, in fact, consumers are just as invested in their mental health and mood as well.
Sustainability is key
Peter Innes, Customer Marketing Manager at Brakes, says sustainability will be increasingly important throughout the supply chain.
What do you think will be the biggest emerging trends in wholesaling in 2024?
The topic on everyone’s lips is sustainability. There is no doubt that this is increasingly important throughout the supply chain right up to and including consumers. The microscope is on all aspects of what we do and from energy to waste to packaging to deliveries the industry needs to focus its efforts on minimising its environmental impact.
How is the cost of living crisis affecting the wholesale sector?
Consumer prices have risen significantly over the last couple of years and, while inflation may not be at its peak, levels are still high. This is putting significant pressure on consumer spending and consumers are being cautious about discretionary spending, impacting footfall and volumes in hospitality. However, while the footfall may be lower, customers are reporting that consumers are compensating for eating less often with more indulgent or higher quality food and drink.
There is further good news in that, while consumer confidence remains low, it is on a positive trajectory, and the hospitality sector is expected to continue its steady growth over the coming months.
What will be the key categories to watch out for?
The critical thing here may not be specific categories, but value within them. It has been a challenging time for the hospitality sector, and we have been working hard to provide products and solutions that helps operators to run their businesses, whether that’s plant forward, prepared products or even our unique mybrakes rewards personalised programme.
How can wholesalers best prepare for 2024?
Think about what value they are adding to the customer. Understanding the end consumer and their needs and motivations and translate that into the products and services that help customers to deliver that.
Do you think online shopping will increase over the next year?
Foodservice customers want the flexibility to order in a way that fits their work patterns. That’s one of the reasons we’ve seen so much growth in online shopping. We expect this to continue and have invested heavily in developing our digital platforms to improve the customer experience.
Will wholesalers need to make better use of technology to survive?
Within Brakes, technology is helping to develop all aspects of our business. We’re fortunate to be part of Sysco which has some world-leading proprietary technology that we’re implementing within our business.
While technology does and will continue to play a pivotal role in our sector, we are still a people business and focusing on great personal interactions. For example, there’s nothing quite like our development chefs cooking up food that customers can taste and experience or our food expos where customers can meet face to face and sample an array of products.
Will consumers stay in more and will there consequently be more products aimed at in-home consumption?
Consumers want to socialise and spend time together out of home, but there is no doubt that it may be challenging for some in 2024.
However, despite the doom and gloom that many have predicted, we continue to see a steady recovery in out of home consumption.
What is absolutely vital for operators is that they continue to offer consumers ‘value’ and that they deliver the experience that customers are looking for. And we will continue to deliver the innovation and NPD to help them do this.
Will healthy eating and wellness be even bigger trends in 2024?
Healthy eating and wellness are important trends. Whether they are bigger in 2024 remains to be seen, as with consumers looking for better experiences, they could indulge more.
Diverse cuisine
Sarah Hall-Attah, Head of Sales at Harvest, says consumers will enjoy a wide array of foods from around the world.
What do you think will be the biggest emerging trends in wholesaling in 2024?
British fusion, rustic Mexican and Eastern European Food cuisines will be prominent along with local provenance and Street fast food concepts.
How is the cost-of-living crisis affecting the wholesale sector?
With a smaller pie marketplace, wholesalers are challenged to retain their slice. Pricing will remain critical and business target margins impacted to drive the sales numbers.
What will be the key categories to watch out for?
Frozen will remain strong as staff shortages drive skill gaps and menus becomesmaller to manage food waste and costs. Plant-based will continue to grow.
How can wholesalers best prepare for 2024?
Keep staff engaged, support and encourage resilience and ensure that customer service remains paramount.
Do you think online shopping will increase over the next year?
100% of our customers have a consumer mindset, they want easy, fast, authentic and affordable. With continued staff shortages, time will be critical to keep staffing levels managed.
Do consumers still love local shopping?
I believe there is always a love for it, the economy will dictate how local retailers will be able to continue to compete. Click and pay will continue to grow.
Will wholesalers need to make better use of technology to survive?
I believe if there’s a significant cost saving with increased efficiency and profits then yes, installs will happen, otherwise wholesalers will sit tight with what they currently use.
Will consumers stay in more and will there consequently be more products aimed at in-home consumption?
100% and I expect to see a reboot of the supermarket’s dine-in menu offering 2 for £x. That said, I believe premium outings will remain, but the consumer expectations will be greater for a more credible experience for their spend.
Will healthy eating and wellness be even bigger trends in 2024?
I see these to continue to rise with the mind body and nutrition being continued focuses.
Market consolidates
David Longfellow, Chairman, National Buying Consortium, says consolidation within the wholesale channel will be the biggest emerging trend of 2024.
What do you think will be the biggest emerging trends in wholesaling in 2024?
It has, and will continue to be, consolidation within the wholesale channel. Our market is under extreme pressure, particularly with the cost of living crisis to which we are all trying hard to adapt to. A potential Government change during 2024 is also likely to create a degree of nervousness and should there be a further rise in taxes to fund government expenditure it may hit consumers and businesses at the same time.
How is the cost of living crisis affecting the wholesale sector?
This will not go away anytime soon – the hits to income from rising costs across both goods and services will be a factor for a long time as wages try to keep pace; there is a limit to which employers can retain profitability with rising costs and challenging demand patterns. Families in particular will continue to have to strike a balance about what can and cannot be afforded – they will be on the lookout for real value and our businesses, together with our supplier partners, must make sure we meet their needs as much as is practical.
What will be the key categories to watch out for?
On the upside – energy categories, particularly soft drinks but also food to go. On the downside – especially as the sector has not had such a high volume, high value new category for a while – will be disposable vaping as concerns grow for a variety of reasons that may well incentivise government intervention. We also anticipate the continued focus upon environmental and sustainable pressure becoming more evident with product ingredients and packaging.
How can wholesalers best prepare for 2024?
Wholesalers should focus upon service, reliability, responding with flexibility as things change, and look to improve the customer experience so that they keep returning. This means relationships will be key, responding well to mistakes, and gaining trust to keep customers active with you. Technology can be a vital tool to develop, and our channel needs to embrace this much more than it does currently. Costs remain critical to survival but less so if the margin and mix of ranges can be optimised.
Do you think online shopping will increase over the next year?
Yes, although this may vary by product type and retail experience. We believe that B2B online shopping will be a major opportunity, especially via online, instant ordering Apps which allow our customers to react far more quickly to local demand. Which of course means we need to be more nimble as well.
Do consumers still love local shopping?
Absolutely, yes, we all thought a few years ago that local would decline but local store standards with great availability, especially across fresh categories and convenience ranges, has improved the shopping experience massively.
Will wholesalers need to make better use of technology to survive?
Yes – by helping our customers to get more of what they want, when they want it, and using Artificial Intelligence to optimise the customer experience for the good of everyone. This should not be at the expense of good old fashioned customer service provided by people.
Will consumers stay in more and will there consequently be more products aimed at in-home consumption?
This is a bit of a balancing act – consumers will want to get great value when they do go out, likewise the quality of what they have at home will have to meet more demanding standards as certain operators ramp up their offerings for at home consumption.
Will healthy eating and wellness be even bigger trends in 2024?
I think this will slow down a little, mainly because of the impact of the cost of living rises, but that does not mean we should not be providing the healthy choices – if we provide the choice then hopefully consumers can take an educated decision about what is good for them and also affordable.
Our group, NBC, will continue to work collaboratively with our members and our supplier partners so that we can continue to flourish despite the likely challenges we all face.
Convenience growth
Guy Swindell, joint managing director of Parfetts, says the convenience channel will continue to grow in 2024.
What do you think will be the biggest emerging trends in wholesaling in 2024?
The good news is that the convenience sector looks set for continued growth. Shoppers will become more savvy and focused on finding value with every visit. It will be important for retailers to find value through promotions and expand own label offerings, which offer great margins.
How is the cost of living crisis affecting the wholesale sector?
Parfetts recognises the most pressing concern for retailers today is the rising costs of doing business. To help, we are focusing on helping retailers make more margin.
What will be the key categories to watch out for?
Own label continues to grow in importance for retailers as they seek to maintain margin while offering consumers great value. It’s a trend that Parfetts is following closely, and its own label range continues to expand. The own-label range has proven successful and offers everything from impulse categories to household products, such as soft drinks, energy drinks, snacks and pet food. It has seen over 25% year-on-year growth to date.
How can wholesalers best prepare for 2024?
Digital engagement is a growing tool to engage with consumers, and our digital team can help retailers understand and exploit the many opportunities it can bring.
Take time to take advice early and put in place the changes you need to make to put you in the best position to grow profitably in 2024.
Do you think online shopping will increase over the next year?
The home delivery market continues to evolve and grow as more consumers enjoy last-mile delivery. Online shopping is here to stay and will continue growing as people appreciate its convenience.
Do consumers still love local shopping?
Market estimates suggest continued growth in 2024 for the convenience sector, with an anticipated increase of 4.1% to reach an overall market value of £47.1bn.
Will wholesalers need to make better use of technology to survive?
A modern Point of Sale (POS) system will incorporate inventory management to monitor product sales, control stock levels, and streamline reordering procedures. They can also be used to gather consumer information and provide insights into purchasing patterns, enabling targeted advertising and promotions.
Mobile-enabled stores will also provide customers with the convenience of ordering goods and services from their phones by creating mobile apps and online ordering systems. To improve customer engagement, incorporate features like location-based incentives, loyalty programmes, and in-app purchases.
Finally, to speed up transactions and minimise cash handling, accept contactless payment methods like contactless credit/debit cards and mobile wallets (like Apple Pay and Google Pay).
Will consumers stay in more, and will there consequently be more products aimed at in-home consumption?
The cost of living crisis looks set to continue over the coming months. It means shoppers in the UK are going to eat more meals at home. At-home cooks will become more and more interested in cost-effective items and solutions, like batch cooking and locating less expensive supplies.
Will healthy eating and wellness be even bigger trends in 2024?
The British Nutrition Foundation estimates that 33% of Brits say they have increased the amount of fruit and vegetables in their diets, while 29% have begun preparing healthier meals, and 32% have increased their water intake.
There are lots of ways for retailers to benefit from this trend, from stocking a wider range of protein products to healthy snacking, vitamin-enriched waters and lower-calorie meal options.
Costs hit wholesalers
Emma Senior, Managing Director of Sugro UK, says rising costs for suppliers are having a direct impact on wholesalers.
What do you think will be the biggest emerging trends in wholesaling in 2024?
Value will continue to play an important role in 2024. One way that impacts wholesalers is consumer demand, so here we see PMP and bigger value packs playing a key role. But also, the rising costs for suppliers are having a direct impact on wholesalers. They continue to search for value in their own networks, so we see an ongoing rise of minimum order requirements from them, together with product availability issues. Wholesalers therefore need to look at effective ordering solutions, such as consolidation and being quick to change products to ensure there is availability on shelf.
How is the cost-of-living crisis affecting the wholesale sector?
2023 has continued to be a challenging year, with spend being squeezed for all of us. As increased costs have impacted on all aspects of the supply chain, we have seen an unprecedented volume of Cost Price Increases. Not only does this provide an admin headache for wholesalers, it can also be confusing, with managing different packs and prices.
What will be the key categories to watch out for?
Trusted brands tend to do well when times are tough. Snacking is seen as an affordable treat for the family and is important for those consumers who are staying in more. Price mark packs will continue to be important as consumers want to see a price they can trust.
How can wholesalers best prepare for 2024?
With continued volatility in supply chains, maintenance of core range and stocking best sellers is key. But we know that our wholesalers are very flexible and quick to adapt, so keeping an eye on trends and what consumers want will be vital. When poor supply impacts, the ability to switch products within the range will also be important. Also keep an eye on innovative NPD. We know that consumers still love to try something new, even when times are hard.
Do you think online shopping will increase over the next year?
I think online shopping will continue to play a pivotal role for consumers, but we might be reaching a plateau. Online is important for many households and we saw so much switching during the pandemic, but as people return to the workplace more and more, we see them reverting to old habits of nipping into the local store.
Do consumers still love local shopping?
Local stores have increased their offering over time, thus making them more attractive in the local community. Consumers are mindful of the cost of fuel and parking and therefore shopping local is key for them. Basket spend is up, but volume is down, so ease of shop and stocking the right range is vitality important.
We also should be mindful of protecting our retailers. Their costs are being squeezed and are not helped by the increase in theft. It is crucial therefore, that we continue to lobby local MP’s and Government to look at measures to protect these hardworking individuals.
Will wholesalers need to make better use of technology to survive?
Technology is essential, particularly with cost increases and labour shortages. Working more efficiently will help the profit line and therefore wholesalers need to be on the lookout for the next opportunity in this area. Competition is fierce, so those who remain ahead of the game will be more successful.
Will consumers stay in more and will there consequently be more products aimed at in-home consumption?
Eating out in restaurants and pubs may be saved for special occasions. This provides an opportunity for fast food outlets – cheaper than expensive restaurants. Technology plays a huge role, with Just Eat forming alliances with convenience stores and spreading to rural areas. Links with snacks and drinks will be an opportunity.
Will healthy eating and wellness be even bigger trends in 2024?
Manufacturers are responding to consumer and government demand, with HFSS compliant products and many snacks less than 100 calories. Wholesalers are mindful of cost, so it is important for manufacturers not to launch healthy but expensive products.
Value is crucial
John Kinney, Managing Director at Unitas Wholesale, says value will remain high on shoppers’ agendas.
What do you think will be the biggest emerging trends in wholesaling in 2024?
Sustainability will undoubtably grow as a key consideration for consumers as we move into 2024. Highlighting the sustainable credentials of the retail outlet and of the products they sell will help the consumer decide where to shop and what to purchase. Value can be expected to remain high on shoppers’ agendas with no end in sight to financial challenges being faced. Although the levels of inflation are not expected to be as high as we have seen this year, inflation and price increases will remain a constant feature of the food sector for some time to come.
How is the cost-of-living crisis affecting the wholesale sector?
Across all channels in wholesale, we have seen evidence of our customers seeking out a value offer to meet the needs of consumers. The growth of own label products is evidence of this.
Operational margins are being squeezed as many businesses have faced significant increases in their cost to do business. Despite these challenges, many wholesalers have taken the decision not to cut back on the quality of services they offer but take the opportunity to invest in their business and position themselves for long term growth. Investment in fleet, IT, new premises etc. can be seen across Unitas Wholesalers, as they ensure they’re well positioned to support their customer base now and in the future.
What will be the key categories to watch out for?
Own brand is a big opportunity and it continues to grow share in convenience stores as shoppers look to save money. Unitas has responded by launching a new own label brand, “Local Living”, replacing the Lifestyle brand.
How can wholesalers best prepare for 2024?
Wholesalers need to be looking at their customer base and understanding the new requirements being asked of them. As we know, value, health and sustainability will be some of the key demands in 2024, so wholesalers need to be reviewing their offer now to ensure they are well placed to meet these needs.
Do consumers still love local shopping?
This year’s ACS Local Shop Report highlighted a 4% sales value growth in convenience, taking it to a £47.1bn market. Local shops have an important role to play in their communities. They go way beyond providing convenient top up shops, many deliver essential services and provide a hub for their community, and we see no reason why this growth will not continue throughout next year.
Will wholesalers need to make better use of technology to survive?
Over the past 12 months, it has been evident that Unitas has some of the biggest and the best members operating in the digital arena. With forward thinking, our members have invested in cutting-edge technology and are embracing technological advancements to support supplier brand activation plans and enhance efficiencies across their business.
Will consumers stay in more and will there consequently be more products aimed at in-home consumption?
One of the outcomes of Covid for the UK population is that going out to socialise is now a protected activity. Whilst the cost-of-living crisis has challenged this and consumers’ out of home visits may have dropped in frequency, the quality of product and experience they expect has not waned. We are seeing consumers budget smarter, eating well at home more frequently but reserving spend for those out of home occasions, albeit less often.
Will healthy eating and wellness be even bigger trends in 2024?
With the HFSS legislation coming into effect in 2025, we will likely see more product redevelopment and innovation targeted at healthier lifestyles. It will be crucial for retailers to ensure healthier choices are available across key categories, however, not at the expense of value, margins and core range bestsellers.
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