Wholesaling, especially cash & carry wholesaling, is meant to be a simple business. We buy goods in bulk from suppliers, we put them on shelves in our big sheds, and our customers come to us to buy them, pay cash for them, load them into their own transport and return to their business.
So where’s the problem? Put simply, suppliers are understandably cutting costs - but in doing so they are introducing huge levels of inefficiency, and therefore cost, into our business.The worst culprits are the biggest blue-chip suppliers. The only sensible way to illustrate the problems is to highlight the performance of two companies - Mars and Cadbury - at just one of our depots - Aintree. These are just examples, by no means the worst.
First Mars. Our group promotion, running from 18 September to 8 October, featured Galaxy Milk, Caramel and Cookie Crumble in price-marked £1 packs. I visited Aintree on 5 October to be informed that we had not had any stock until that date. My other depots had fared little better, in spite of the fact that we had provided sales forecasts back in April.
An isolated example, you might think. However, while stock availability is almost the holy grail, efficient stock control and depot staffing are a close second. For major suppliers we allocate delivery slots every week in order to manage stock flow. Not only does this help with unloading efficiency, but we gear staffing levels on both goods-in and shop floor areas to deal with this schedule. In the month prior to my visit, the Mars delivery had only arrived on schedule once. On one occasion, it arrived at our other Liverpool depot.
We have also suffered during the Cadbury-Kraft transition. Hall’s Soothers are delivered in shipping outers of eight units of sale - fairly simple to manage. But when the paperwork changed to Kraft, we were assured we should order in ‘inners’. A similar situation applied to Trident gum. The outcome was that when we expected one mixed pallet of Halls and Trident products, we got eight pallets (and still await credit for the excess). Cadbury had a similar record of missed slots, but the Kraft systems unilaterally decided our delivery day should be changed - with consequent further disruption. The final occasion when a delivery didn’t arrive was when we were told we had not paid for goods. Kraft had mis-allocated our payment.
I am extremely conscious that I have singled out two major suppliers here. We have an excellent relationship with both Mars and Cadbury and similar tales could be told of many suppliers.
What I want to do is illustrate the costs in both shop floor and management time in sorting out the cumulative effects of these apparently minor occurrences of service failure. We are supposed to be a low-cost business. I therefore make a plea to suppliers. We want to work with you to efficiently get your goods on sale and available to our customers to our mutual benefit. Please don’t download the costs of your inefficiencies to us or break routine arrangements.
We aren’t perfect and may contribute to our own difficulties at times. But we will continue to try to improve, and hope you will too.
Steve Parfett is chairman at AG Parfett & Sons and Landmark Wholesale