Unitas Wholesale, created from the merger of Landmark and Today’s in 2018, is the largest wholesale services company in the UK, with a buying power in excess of £8 billion.
It has 164 wholesale members with 287 wholesale depots, reaching 177,000 customers.
The group prides itself on being the champion of independents and champion of brands.
Darren Goldney, Managing Director at Unitas Wholesale, told Wholesale Manager about how the merged business is performing two years on and about his plans to grow the business in 2021.
Two years on from the merger of Landmark and Today’s, how is the merged Unitas business performing?
It is pleasing, as a basic measure of success the total group grew in 2019 and has grown again in 2020. However, whilst growth is one thing, individual members would judge our success more by the services and support we offer them and how we best enable them to compete to win. We have extended our services and members can now rely on us for a huge range of support from taking the stress away from the basics of promotional activity and ORD across hundreds of suppliers to extended support such as data, marketing, social media activity, drop shipment and group cost reduction deals on commodities such as energy and fuel. The core value is in our tracking of competitiveness and being the voice of the member with our supplier partners. Suppliers will judge us and respond most favourably when we can demonstrate how efficient we make it to deal with 164 wholesalers through one place for many initiatives, and how effective our sales programmes can be. Our success is in balancing the needs of these two parties. The summary is our membership is growing and feedback from suppliers is good based on the Advantage report.
Shortly after the merger you said you wanted the business to cost less and sell more. Have you achieved this goal?
Yes, on both fronts. Cost reduced as we de-duplicated elements in the business and investment has grown. We have reinvested those monies in creating a ‘more for more’ membership structure where initiatives such as Picture Portal in retail and our Bar and Kitchen programmes in foodservice reward members for supporting key programmes. Technology investment plays a key part, and we are excited to be investing in our new Digital Excellence Academy in 2021. The simple truth is when our members support these initiatives we sell more!
You have been in wholesaling since the 1990s. How has the industry changed in that time?
The core role is the same. Wholesale is, and always will be, a cost-effective route to market that suits suppliers, as it is cheaper than doing it yourself. It suits end outlets as they need consolidated deliveries or pickups. The margin a wholesaler makes if anything may have gone down with The Grocer Top 30 last year showing five Unitas members averaging about 1%. I believe what has changed is the added value that wholesalers give within that margin now. Symbol and Retail club did not exist, data was silent, there was no menu of design/support services. It was much more Cash and Carry which has less cost and core range initiatives were frugal. The landscape has changed and while wholesalers by no means do all this alone, the partnership with suppliers has meant independent outlets are far better supported and not alone. Successful wholesalers have managed to become more efficient by investing e.g., voice pick, digital order capture, energy efficiency etc.
Which of the product categories you supply are in growth and which are more challenging?
2020 has bucked many trends with a brilliant opportunity for grocery and non-food where consumers are reappraising small independent stores, realising they can provide a great offer. Alcohol and tobacco have built on core strengths. Impulse has been tricky especially soft drinks which from the main impulse categories has been hardest hit due to lower out of home consumption.
How are the Unitas symbol groups, including Day-Today, Today’s Local and Lifestyle Express, performing? Is membership still growing?
We have a total Unitas retail estate of approximately 4000 symbol and retail club stores. More retailers are turning to this model in order to be able to offer value and obtain advice and guidance through our Plan for Profit advice and guidance. In Scotland the excellent achievements of the Day Today fascia and some leading Lifestyle stores are areas of strength.
How digital is Unitas as a business?
More than ever before.
Our Plan for Profit initiative has approximately 9000 retailers engaged and the Take Stock platform targeted to Out of Home end users is growing quickly.
Digital is a really broad term meaning differing things to different people, however, from an efficiency point of view what is not visible to many suppliers is the absolute efficiency our digital TOPS and TERMS platforms enabling complex supplier information from nearly 300 sources to be consolidated into one central platform for our member wholesalers to view and use. This gives best leverage to a supplier’s investment and ease of access to members. I heard a term once regarding the role of technology, which was to ‘standardise the back office’ in order to ‘liberate the front office’, which refers to how wholesale has changed the role of a Group and technology to remove duplication and administrative resource from independent wholesalers, which has given them the ability to invest in those added value items mentioned earlier.
Partnering with Lumina Intelligence we aspire to use our Digital Excellence Academy to step change B2B transactional excellence in 2021. B2B excellence is the first and necessary base which is the lion’s share of the benefit.
Do you offer any IT support for your members e.g. ordering apps, online support, delivery tracking?
Yes we do. We have central agreements with software providers and app providers for B2B and B2C.
Did your depots remain open during the Covid-19 crisis? Was it difficult to enforce social distancing in-depot?
About 20 of our member’s depots closed from the on-trade division as there were no customers buying due to lockdown. All of those wholesalers affected have either re-opened or plan to do so.
Wholesalers and their customers themselves have all spent a lot of time and money on ensuring that regulations relating to the pandemic are adhered to, so we haven’t had a huge amount of feedback on issues as we all respect it is a ‘must’ to get this right.
How has your business and the wholesale industry in general been affected by the Covid-19 pandemic?
There could be a very long answer to this question, however, the short one is ‘retail‘ based wholesalers have seen a sales benefit which has generally offset increased costs to service that new demand. It has been tough, and they have played a huge role in ensuring small independent stores were there to give consumers choice versus the crowded multiples. Availability has been their number one challenge.
Unitas has about 60 wholesale members operating in the Out of Home channel. They have and continue to suffer badly as a result of the pandemic and lockdown restrictions.
Little support specific to the wholesale industry has been provided by the government, although at the time of writing the situation in Scotland looks more promising. As an organisation we are working tirelessly for England and Wales and have played a role in encouraging multiples to return monies they previously received as part of the rate relief scheme. We are now pushing to get what is fair and right for independent foodservice and on-trade wholesalers.
Has Amazon become an even greater threat over the last year, given the rise in online ordering due to the pandemic?
Amazon is a threat and an opportunity. Independent wholesalers could lose sales that would have otherwise gone through our channel; however, Amazon pricing can be expensive. It also provides some opportunity for B2C sales which more members are capitalising on.
What impact do you think Brexit will have on the industry?
The truth is we don’t know but we are seeing some price rises already and some stock build to mitigate unknown supply disruption. In the end, it will be a level playing field for competition within wholesale but the short-term uncertainty means every business jostles to do the best it can to support its customers and not lose out in the short term. This drives cost and stress into the industry and with wholesale margins often at c 1% ultimately it has to be passed on at some point.
What are your plans to grow the business in 2021?
To harness the power of independent wholesale by enabling it to work together.
This will benefit wholesalers and suppliers who desperately want a viable and sustainable alternative route to market to the goliaths they’d otherwise rely on.
It can be dressed up in many ways, however, our focus will be on core range in wholesale and the key outlet groups we serve, compliance of promotions across both B2B and B2C, better capability to get NPD into the market place. We will be doing this through digital and data!
We recently held virtual supplier briefings, together with member equivalents, with over 200 senior leaders and discussed the platforms they could engage with. We are making great progress and we will get quicker, if suppliers and progressive independent wholesalers get even further on board with us, we can make the journey together.