In January, Parfetts appointed Gurminder Athwal as Trading Director to support its plans as it continues to expand its depot network and Go Local symbol group.
‘Gurms’, as he is known throughout the industry, brings a wealth of experience after 20 years at Hyperama.
He is now leading a respected trading team as the company continues to grow.
Gurms told Wholesale Manager what he will be working on and how he plans to grow the business in 2021.
Gurms, congratulations on being appointed as Trading Director at Parfetts. Tell us about your background in the industry, where you have previously worked and for how long?
After graduating in 2000 and looking to build a career in sales I joined Hyperama. Very early on I was encouraged by the directors to look at pursuing a career in purchasing – which I did. I never looked back as I went on to enjoy 20 years at Hyperama where I gained cross category buying experience during the first decade. I was then promoted to Senior Trading Controller for key categories (mainly licensed) and also worked simultaneously with the op’s, marketing and sales teams on various projects and gained knowledge of the wider business.
Over the last few years I was leading the trading team as Head of Trading. I then had the fantastic opportunity to join Parfetts as Trading Director and start a new chapter in my career. Even though I’ve only recently been in the new role I feel as though I have been part of this successful employee-owned business a lot longer – mainly due to the way the whole team has welcomed me into the business and helped me integrate from day one.
What aspects of the Parfetts business will you be working on?
From what I can already see and from the positive feedback from suppliers and customers, we are very good at delivering a best-in-class comprehensive route to market option for suppliers whilst ticking all the right boxes for our continually growing retail customer base. As a business we will always look at ways to constantly improve and be more efficient whilst striving for sustainable growth for all parties involved throughout the supply chain.
So apart from working closely with the trading team, suppliers and other business units on a day to day basis, I’ll be implementing long term strategies and development plans for each of our key categories (especially for any that we underperform versus the market place).
We will continually develop our own brand range that complements our overall portfolio whilst keeping the consumer and retailer at the forefront. The trading team will also be supporting Guy Swindell (Retail Director) and his team on our GO Local fascia growth aspirations whilst still working closely with our existing fascia customers. We will continually build on our geographical expansion plans though logistics which offers retailers free next day delivery along with many more benefits.
We are also currently working on our Virtual Trade Show event which we’ll be discussing with suppliers very soon. This will give them a platform to share their brand plans, NPD, category updates and hold forums with our top customers amongst many other initiatives in the pipeline.
You have been in wholesaling for 20 years. How has the industry changed in that time?
There has been a lot of changes over the years with several cases of consolidation across the supply chain, also a shift towards delivered, online and continuous regulations – all of which has resulted in wholesalers having to up their game in order to compete and thrive in a very competitive low margin market place.
Price marked packs are playing an important role within convenience compared to when I first started off in wholesale. We encourage suppliers to be more proactive in price marking their brands and NPD and to engage with us and other wholesalers early on to ensure a fair price mark, shared margin, correct packaging/pack sizes amongst other criteria. We work to this model for our own brand launches (again an area that has been perceived in different ways over the years) which has proved to be really successful and gained a lot of support and distribution with our customers. I firmly believe that just getting even one element of the above criteria wrong can severely impact and hinder sales of a product which can be costly and disheartening for all parties involved.
There seems to be a lot less representation from suppliers and sometimes a person is not empowered to make certain decisions. This can result in missed opportunities and delays which, coupled with constant and regular changes to personnel from suppliers who use wholesale as a training ground, can lead to frustration and dis-engagement on our behalf. The challenges and opportunities get lost in the transitional period. This can lead to suppliers not understanding what certain wholesalers bring to the table and how they help improve the industry collaboratively.
I have seen over the years a lot of new explosive categories which have become a key part of our businesses, for example food on the go, energy drinks, packaged water, healthy eating, sharing bags/snacks, fruit ciders, premium spirits and new world wines, plus areas like chilled beer and drinks becoming the norm within convenience.
Other changes that have impacted the industry (some good, some bad) range from Sunday trading laws, Brexit, AWRS, minimum wage, soft drinks sugar tax, cigarettes display ban, minimum unit pricing to more recently social distancing and other health and safety regulations with more to come and of course the soon to be implemented HFSS.
As always with change progressive wholesalers and independent retailers and caterers continue to look at better ways of working and invest in areas such as symbol, fascia, IT, digital, data and much more to create USPs and in some instances offer a one stop solution whilst exploring new avenues.
How is Parfetts performing as a business? Is turnover growing?
Parfetts has seen continued growth over the years and finished our financial year with turnover of £474m through seven sites which is a like for like growth of 25%. During the last year we were trading at 100%+ during the first lockdown and then throughout the year traded up to 40%. We are on course to achieve our target of £500m and aim to consolidate our turnover into the recovery and then aim for further growth with all the plans and initiatives we are looking to implement during the course of the year.
Which of the product categories you supply are in growth and which are more challenging?
All categories have shown significant growth whist grocery, licensed and non-food categories have outperformed impulse categories. Within all categories we’ve seen huge growth in take home packs, bigger packs, sharing and multipacks. Whilst certain tailored deals and excellent execution at retail level has helped us grow our impulse offerings, there is still a lot of scope to grow ever further this year with the right packs and price points for both take home and impulse categories.
We have suffered with foodservice categories and ranges within other key categories due to the lockdowns but we are determined to continue the focus on these once we are in a position to do so.
How are the Parfetts symbol groups, including Go Local and Go Local Extra, performing? Is membership still growing?
Go Local Fascia has performed exceptionally well and we now have 650 stores, Despite the lockdown and forced pause on recruitment Guy and his team have achieved a record-breaking year for recruitment and as we gather momentum and enter new regions we are moving a step closer to our target of 1000 stores.
GOLD (Go Local Delivered) contributed £94m sales (YOY increase of 51% and growing). We invested an extra £1.5m in 2020 into our four delivered hybrid depots. We have further investment planned for the depots and fleet in 2021 to support our 24 hour operation and to service customers well beyond our current bricks and mortar cash & carry’s and capitalise on customers’ changing demands and expectations.
How digital is Parfetts as a business?
Currently a third of our business is from online ordering, which includes both click and collect and deliveries. However, the digital thread runs right the way through our day to day operations, from tills, order placement and picking to data and social media.
The 2021 plan is to build upon the digital foundations we have made and continue to develop new and innovative ways to offer range and choice plus improved communication with our retailers and end consumers. We recently conducted a survey which highlighted what additional features they’d like to see in an online environment, elements such as developing our new app, introducing more category data and planograms and insights in order to educate them and help make more informed decisions. It was great to hear that our current development roadmap and customer feedback was very much aligned. The digital team headed by Natalie Campbell and the trading team look forward to working with suppliers to bring these elements to life.
Do you offer any IT support for your members e.g. ordering apps, online support, delivery tracking?
We offer members our ordering website and app to place orders for click and collect or deliveries where the customers also have the capability to track their orders. We have various people available to support customers with online platforms from our RDAs (Retail Development Advisors) to our IT department and digital suite. Our platforms offer retailers more efficient ways of ordering, through taxonomy, seasonal/events advertisements and they can even access a downloadable digital POS pack for our retail club with ready to post social media assets.
Have your depots remained open during the Covid-19 crisis? Is it difficult to enforce social distancing in-depot?
All our depots remained open every day throughout the entire Covid-19 crisis. The commitment and hard work of all our staff during the last year has been amazing, putting themselves on the front line, working in extremely difficult conditions and dealing with huge increases in footfall and volume whilst at the same time adapting to new ways of working and new practices for social distancing and cleaning regimes. Andy Whitworth (Wholesale Director) and his whole team have done a fantastic job in implementing all of this in a very short time frame whilst still operating the depots during a very busy period.
Implementing social distancing is difficult in large warehouses. As soon as sales started to increase it was important that we managed the number of customers and staff in the depots. Queueing systems were introduced on the car parks and one way routes in bottleneck areas, floor markings, depot signage and regular tannoy announcements are in place to remind us all of the importance of maintaining social distancing.
Social distancing and face masks are internally at the top of everyone’s agenda on a daily basis, customers are understanding what is expected from them and while there are occasions when a customer forgets, a gentle reminder has always been received in the correct manner. The wholesale industry like most have had to invest vastly into safety equipment and new procedures in order to protect and safeguard all customers and employees in line with government guidelines.
How has your business and the wholesale industry in general been affected by the Covid-19 pandemic?
It’s a two-edged sword. While retail has been the real success story, foodservice has been the victim. Fortunately for us a business we are heavily geared towards the retail sector and have seen huge increases in sales for 12 months and continue to retain large proportions of early increases. At the height of the crisis, sales were increasing by 100% and now at around 40%. Unfortunately, these increases in volumes have not been matched by some suppliers and for periods of time stock was simply not available in our channel or under-allocated and possibly diverted to other grocery channels, meaning local convenience stores – a service needed most during lockdowns by consumers – was not serviced to the levels required.
Our growth couldn’t be sustained with our previous staffing structure and fleet capacity, so in the last 12 months we have increased our employee levels by over 100 extra staff to cope with demand and cover absences during the pandemic. These staff are working new twilight shifts to replenish fixtures and pick orders to fulfil our next day offering. Our commercial fleet has also increased from around 50 vehicles to 65 and will increase further in 2021 to over 75.
Communication networks both internally and externally stepped up a gear by using online meeting platforms such as Teams and Zoom to ensure we continued to work closely with colleagues and pro-active suppliers by planning, forecasting, sharing experiences, trends and initiatives while trying to resolve any issues. So overall wholesalers have had to adapt during a very challenging and uncertain period which in return I believe will make us stronger and more resilient.
Has Amazon become an even greater threat over the last year, given the rise in online ordering due to the pandemic?
There is no denying Amazon has certainly increased its grocery sales especially with the Prime Now offering and no doubt the e-commerce giant has changed the retail sector forever (even more so during the pandemic). As buying habits have rapidly changed I feel this has only served to encourage our retailers to drive their businesses forward by looking at opportunities such as having an online presence, delivery services through conventional methods like telephone orders or WhatsApp or via app platforms such as Snappy Shopper, click and collect and loyalty schemes. These services have continued outside of lockdown due to popularity and also helped retailers establish a good community following. Furthermore our retailers have been a consistent support figure to their customers during the pandemic by offering a safe environment to get their essential goods and offer friendly engagement and service which in turn supports good mental health and wellbeing and satisfaction.
We have also seen consumers shopping more locally and when possible more frequently with increased range and basket spend. So to help retain as much of their incremental sales as possible and ensure they come out of the pandemic in a stronger position our team of RDAs are constantly working closely with our fascia customers. I would therefore encourage any supplier that doesn’t fully engage with us on digital and category partnership and any other initiatives to allow us to help you understand our business model in more detail and start to reap the rewards. It is just as important for suppliers to have a strong healthy independent retailer and wholesaler customer base so that they are able to distribute and grow their current and new branded products profitably.
What impact do you think Brexit will have on the industry?
A Brexit deal with the EU was well received albeit last minute especially with all the uncertainty and planning around the deal or no deal Brexit as wholesalers were faced with and to some degree still have pressures around stock build, pricing increases/issues, further regulations, food labelling, labour and skill shortages, border queues and inconsistencies leading to inventory delays for both imports and exports.
We are not currently seeing any major disruptions. However, as we digest and analyse the finer details and come out at the other end of the pandemic, we will start to realise the real impact of Brexit and how it will affect the economic climate, consumer confidence and spending.
The supply chain will however in the short-term experience added administration costs and possible stock delays and availability issues. Just like most situations like these and the upcoming HFSS regulation there will be different levels of impact on businesses both negative and positive, resulting in some companies winning while others lose out.
What are your plans to grow the business in 2021?
We are continually looking to invest back into our employee-owned business to achieve our growth ambitions. The plans and initiatives discussed earlier from digital, fascia growth, GOLD to geographical expansion through logistics will support our growth over the coming years. We’ll also utilise all the data and insight we have to evaluate, plan and execute while focusing on all aspects of our business and strive to becoming an even better and more efficient and effective organisation to do business with. For more information, contact Parfetts on 0161 429 0429.