Will wholesalers aiming to boost revenues find easy money in foodservice or is it a sector that requires specialists?
Wholesalers looking to expand their business away from traditional grocery where margins are being squeezed and pressure from the multiples seems unrelenting are beginning to take a greater interest in foodservice.
There is no doubt that people are cooking less and the options for eating out are increasing: good news in theory for those wholesalers supplying the catering sector. However, as with all businesses, it’s not that simple. So is foodservice an area that can be exploited by traditional wholesalers or is it too specialist, allowing only those businesses which are fully focused on foodservice to prosper?
This year’s The Big 30 rankings suggest that the specialists have the edge. Brakes and 3663 First for Foodservice occupy prominent positions in the top five, each with turnovers of more than £1bn.
The success of these two companies is evidence that, as for independent retailers, there is a trend towards professional delivered operators that can provide a wide range of support as well as strong availability and a wide product range.
Des Bell, 3663’s marketing director, argues that specialists are better able to develop strategies and services to meet the needs of caterers.
He says: “We have pioneered in some of the areas where the foodservice industry is being challenged. These include our Positive Steps campaign that has championed healthier eating and our recent local sourcing initiative that has helped caterers to source local food from local producers.”
As well as the foodservice big two, our list also includes Hertfordshire-based DBC Foodservice at 15 and Chinese specialist wholesaler Wing Yip rounding up the list at number 30. Wing Yip, is completely different kind of operation to the big national foodservice providers, being more like a traditional cash and carry.
However, between 85% and 95% of Wing Yip’s business is through caterers, and chairman Wing Yip is keen to point out that his business succeeds because of its expertise in identifying niche products that his customers can’t get anywhere else.
Others disagree that the specialists are better at handling foodservice customers. Peter Blakemore, MD of Blakemore Wholesale, insists: “Obviously there are the big foodservice operators out there, but there are also a significant number of smaller caterers who are looking for an intermediate wholesaler whom they can trust. The changes in the pub sector alone with more catering being done in-house than ever before provides a great opportunity for wholesalers.”
While recognising the different needs of both retail and foodservice customers, Blakemore is confident that traditional wholesalers can provide a complete service for both. He proclaims: “We are happy selling to anyone whether it be through cash and carry, delivered wholesale, retailers or caterers. Customers have different needs, but that’s what selling is all about.”
Wholesalers looking to expand their business away from traditional grocery where margins are being squeezed and pressure from the multiples seems unrelenting are beginning to take a greater interest in foodservice.
There is no doubt that people are cooking less and the options for eating out are increasing: good news in theory for those wholesalers supplying the catering sector. However, as with all businesses, it’s not that simple. So is foodservice an area that can be exploited by traditional wholesalers or is it too specialist, allowing only those businesses which are fully focused on foodservice to prosper?
This year’s The Big 30 rankings suggest that the specialists have the edge. Brakes and 3663 First for Foodservice occupy prominent positions in the top five, each with turnovers of more than £1bn.
The success of these two companies is evidence that, as for independent retailers, there is a trend towards professional delivered operators that can provide a wide range of support as well as strong availability and a wide product range.
Des Bell, 3663’s marketing director, argues that specialists are better able to develop strategies and services to meet the needs of caterers.
He says: “We have pioneered in some of the areas where the foodservice industry is being challenged. These include our Positive Steps campaign that has championed healthier eating and our recent local sourcing initiative that has helped caterers to source local food from local producers.”
As well as the foodservice big two, our list also includes Hertfordshire-based DBC Foodservice at 15 and Chinese specialist wholesaler Wing Yip rounding up the list at number 30. Wing Yip, is completely different kind of operation to the big national foodservice providers, being more like a traditional cash and carry.
However, between 85% and 95% of Wing Yip’s business is through caterers, and chairman Wing Yip is keen to point out that his business succeeds because of its expertise in identifying niche products that his customers can’t get anywhere else.
Others disagree that the specialists are better at handling foodservice customers. Peter Blakemore, MD of Blakemore Wholesale, insists: “Obviously there are the big foodservice operators out there, but there are also a significant number of smaller caterers who are looking for an intermediate wholesaler whom they can trust. The changes in the pub sector alone with more catering being done in-house than ever before provides a great opportunity for wholesalers.”
While recognising the different needs of both retail and foodservice customers, Blakemore is confident that traditional wholesalers can provide a complete service for both. He proclaims: “We are happy selling to anyone whether it be through cash and carry, delivered wholesale, retailers or caterers. Customers have different needs, but that’s what selling is all about.”
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