Leading suppliers want to help cash & carry depots get the best sales performance in each category.
Wholesale Manager spoke to some of the top suppliers from the beer, confectionery, energy drinks, hot beverages, snacking and tobacco accessories sectors to find out more about category growth and the major consumer trends driving sales.
On the following pages are guidelines for wholesalers to maximise category sales in their depots and independent retailers to capture category sales in their stores.
We have also detailed what suppliers are doing to help wholesalers grow their sales.
Adrienne Burke, Marketing Manager, Snacking at General Mills, comments: “Since the Coronavirus pandemic, snacking has seen a 40% increase among young people. As a result, demand for Better For You options are booming.”
The diet management category has grown by +2% and is now valued at £106m (Nielsen), as an increased focus on health and limited movement due to lockdown has caused shoppers to worry about weight gain.
The fastest growing snack bar in the weight management category, Fibre One has reached £38million and, following a recipe revamp to contain thirty percent less sugar, is performing strongly in the convenience channel – up 22.1% (Nielsen).
In the cereal bar space, the better for you range from Nature Valley, now a £56million (Nielsen) brand, meets a variety of need states – from nutrient-packed Nature Valley Protein to the more indulgent ‘9pm sofa moment’ with Nature Valley Sweet and Salty Nut.
“We’re also seeing increasing numbers of people making the choice to include more minimally processed, plant-based foods in their diet,” adds Burke. “Our gluten-free, dairy-free and vegan snack bar brand LÄRABAR – made with no more than six ingredients – meets this demand perfectly. Since launching in the UK in 2019, sales of LÄRABAR have reached £1million.”
Changing lifestyles means demand for gluten and dairy free options is increasing, with one in ten people avoiding gluten altogether (Mintel). As a result, wholesalers and retailers that stock snack bars that taste great and can be enjoyed by everyone, like LÄRABAR, are winning big.
Shoppers are also actively looking for snacks to boost nutrition – whether that’s through added fibre or protein, snacks that are fortified with vitamins or those that help them get their five-a-day.
No longer just sports nutrition, products high in protein have become part of everyday snacking – and are the main driver of sales in the overall snack bar category (Kantar).
Nature Valley Protein cereal bars contain 10g protein per bar and are also gluten-free – ticking two major boxes for shoppers looking for better-for-you, functional options when hunger strikes. Each bar offers 20% of consumers’ daily protein needs, without compromising on taste.
“At General Mills, we’re broadening the functional health benefits we offer consumers with new protein platforms across our better for you snacking brands,” says Burke.
Fibre One has launched two permissibly indulgent protein bars in two flavours – Caramel and Cookies & Cream. General Mills’ research found 71% of Fibre One consumers are interested in protein but are wary of the high sugar and calorie content of the options currently on the market. The new range is the ideal alternative – the bars contain 10g of Protein and only 1g of sugar, all for only 90 calories and taste great. They give the perfect protein boost, especially for the pre-and post-gym occasion.
General Mills has also kicked off 2021 with the launch of new Nature Valley Protein Soft Bakes – the first of their kind to hit UK shelves.
Available in two flavours – Oats & Honey and Blueberry & Almond – the soft bakes are a perfect fit for the busy breakfast moment.
“We know 25% of UK consumers eat cereal bars for morning fuel, and are looking for ways to increase their protein intake in the morning too,” Burke continues. “By offering a breakfast biscuit with high protein content that also delivers on taste, we’re meeting this demand head-on.”
Nature Valley Protein Soft Bakes offer 8.4g of protein per bar for a chewy and satisfying eat, either at-home or on-the-go. With 38% of consumers who eat cereal bars for breakfast looking for protein content (Nielsen), the soft bakes meet a specific, previously underserved, need.
Not only ideal for upping protein intake, Nature Valley Protein Soft Bake Biscuits are made with 100% wholegrain oats and barley and are high in fibre. These strong nutritional credentials, combined with flavours that appeal to the morning occasion, make the range a must-stock.
“Correctly stocking and siting better for you snacking segments which perform particularly well at different times of day is crucial,” Burke suggests. “Retailers should clearly signpost their ranges and the various need states they meet, such as functional snacks/morning fuel/guilt-free indulgence. Consumers’ needs vary throughout the day so it’s important wholesalers help retailers provide great solutions across them all.”
Fibre One is the ideal post-dinner treat for weight managers looking for something sweet yet guilt-free. However, the variety in the range means our bars can be reached for any time they need to satisfy a craving. The various products in the Nature Valley portfolio work for a variety of need states – the Crunchy range are a great morning snack, while the Protein bars are popular pre- and post- workout and the Nut Butter Biscuits are a filling, indulgent eat perfect with an afternoon cup of tea.
Susan Nash, Communications Manager at Mondelez, comments: “Recent research confirms retailer confectionery purchases in depot over-index against other categories and that more retailers are on a restocking mission. This means having a strong aisle display is key to helping drive sales.”
Nash recommends displaying a core range covering singles, duos, blocks, bags and gifting.
Allocate the space according to sales potential, allocating more space to best sellers.
Highlight the best-selling lines and have clear pricing, showing clear cash margins. Offer both PMP and non PMP lines.
Encourage retailers to make the most of the seasonal opportunity, for example by displaying on rack ends at appropriate times.
Ensure NPD and promotional products are stocked in advance of consumer media and work with suppliers who are supporting launches and creating consumer demand.
Create impactful displays to catch the eyes of retailers when they are making purchase decisions in depot. Displaying products by the till point is one of the most effective placements.
Use the category knowledge of suppliers who help to promote best practice to retailers, including sharing planograms.
Nash says wholesalers should, “Advise retailers about spending strategy – some retailers go for best margin, that’s not always the best approach – a great margin on a product that doesn’t sell isn’t helpful.”
Nathan Adams, National Account Manager at Republic Technologies, comments: “Tobacco accessories might not be the largest category most wholesalers will deal with, but there are a lot of different segments, all with different uses and purchasing decisions. We recommend merchandising by category then by brand, to make the fixture as easy to shop as possible. Allocate space according to sales potential and make sure pricing is clear. Branded bays and pallet displays will also attract your customers’ attention, boosting sales accordingly.”
Where possible, display some key accessories in the household aisle as well as the tobacco room (allowing for all legislative requirements in Scotland). Matches and utility lighters work best outside of the tobacco room. At the very least, consider displays near the tobacco room door which will give so many more customers visibility and access to these strong-performing products, Adams recommends.
“Wholesale is massively important to us as a business, and we work hard to develop and grow the relationships we have,” adds Adams. “Our Customer Development Team has regular contact with our accounts and is able to offer a full promotional plan across all our brands along with point of sale, off shelf display units and expert category insight. Regularly reviewed and tracked joint business plans are key.”
A Nestle Beverages spokesperson comments: “The in-home coffee category thrived in 2020 with 10.3% greater value sales than the previous year driven by greater in-home consumption across the board caused by increased working from home.”
Core coffee contributes to 76.9% of total coffee sales in independent retailers, driven by regular and premium segments. Well-known brands must be stocked in hot beverages with 60% of all value sales in coffee coming from the top 10 SKUs in independent retailers.
Nescafe? Original is the best-selling brand in terms of value sales in coffee. Nescafe launched a new 95g PMP on both Gold Blend and Original in 2020. Each of these SKUs has sold over £1M in independent retailers inside the first calendar year even though many retailers are yet to switch over from the previous 100g PMP offerings from these brands.
Consumers will continue to trade up in 2021, demanding listing of super-premium, frothy, roast and ground and pods segments. These segments allow for increased distribution, NPD and promotions. Super premium is one of the fastest growing segments in coffee. “Independent retailers should stock Nescafe? Azera as it has added half a million value to the category in the last year in independents, and is the no.1 brand in the super premium segment,” the spokesperson added.
Frothy coffee’s growth of +6.8% value and +12.9% volume MAT (IRI) demonstrates the expandability of coffee consumption as a pleasurable treat. When considering a frothy listing, independents should know shoppers will return if the product has great quality-credentials. Nescafe? Gold Frothy Coffee is the No.1 best seller in the segment (+26% value sales growth 2017-20 according to IRI); at a higher price point than other products in the segment.
It proves customers are happy to pay the price for better quality, being more of an indulgent product. This is backed by Nescafe? Gold Frothy Coffee repeat rate being the strongest in the segment (61.3%, IRI).
“Don’t forget that shoppers are using this channel for a ‘Top Up’ shop and therefore a smaller range of relevant small or medium pack sizes displayed well makes the shopping trip quicker and easier for them,” says the spokesperson. “By giving faster selling lines more space on shelf also reduces the time spent on replenishing the fixture.”
Neil Baker, Head of Category Management at Budweiser Brewing Group, comments: “2020 saw unprecedented growth in the beer category across the off-trade. As the forced closure of pubs and bars moved many drinking occasions into the home, beer sales rose by 28.9% in grocery and 37.5% in impulse (Nielsen). We’re forecasting that 2021 will be another huge year for beer – growing by 12-15% for the total beer category, with impulse and convenience growing ahead of the market compared to the last year of regular trading in 2019.”
As a result of consumers spending more time at home, ’treat’ purchases are on the rise. Alcohol is one area where consumers are choosing to splash out – 52% of shoppers said they were willing to pay extra for quality when buying alcoholic drinks to have at home – helping the premium category to gain momentum (Kantar).
This was reflected in sales of Budweiser Brewing Group’s premium beers, all of which saw strong growth in 2020. Stella Artois remains the UK’s favourite alcohol brand (Nielsen) and Budweiser is now the second most valuable beer brand in the off-trade, growing in value ahead of total category at +29.8% YOY (Nielsen). Corona grew both volume and value at over double the rate of the total category in 2020 (Nielsen) – demonstrating a real desire from shoppers for premium lines.
“2021 has several valuable moments for the beer category and wholesalers should use these to become a trusted partner to their customers, helping them to prepare for increased category demand,” says Baker. The return of international sport this summer is a prime example. Televised sport is a significant driver for at-home beer consumption – 2018’s FIFA World Cup, the last big tournament on our screens, drove the biggest monthly sales in category history (Kantar). There is also a clear correlation between the longer the England team remains in a football tournament and beer sales (Kantar). With a summer of football scheduled to take place and the England men’s team among the favourites to win the Euros, wholesalers should be ready to help their customers capitalise on the occasion.
“Football tournaments also bring an influx of new buyers to the beer category – these shoppers tend to opt for known brands, so having the right range is essential for both wholesalers and their customers,” suggests Baker. “During 2018 FIFA World Cup, 42.1% of Budweiser shoppers were new to lager compared to the same period the previous year, highlighting the growth opportunity for those stocking well-known brands.” The initial lockdown restrictions back in March 2020 saw 25% of Brits choose to shop more at their closest local store, meaning impulse gained +1.7% volume share of beer across total market last year (Nielsen). There’s a real opportunity for independent retailers to consolidate the increased footfall seen in 2020 and build their customer base this year.
The summer of sport will be a key sales driver for the Budweiser family, so Budweiser Brewing Group will be running a suite of activity including giveaways supported by POS, to help create excitement and drive footfall throughout the Euros. But it’s not just football that will boost beer sales this summer, as Budweiser Brewing Group will also be bringing back limited-edition Stella Artois packaging, helping retailers get into the spirit of Wimbledon, in the brand’s role as official beer of the Championships.
“Independents should consider merchandising food and drink pairings as a way to capture cross-category spend,” Baker recommends. “Beer has become a new staple at mealtimes – three out of five beers are now consumed with food, so retailers can appeal to new customers by highlighting these combinations. For example, the crisp, clean taste of Budweiser pairs perfectly with a selection of crisps and dips – items that are typically popular when watching sports. Alternatively, Stella Artois, and its Belgian heritage, complements continental-style platters such as charcuterie and cheese for a sophisticated date night. Engaging with shoppers at different touchpoints throughout the store is a valuable way to increase basket spend.”