The invasion of Ukraine, last year’s IT problems for Walkers and cyberattacks on suppliers are all impacting the flow of stock for the clearance wholesale trade.
Convenience retailers who regularly source from clearance wholesalers have told The Grocer they have struggled recently to secure stock, particularly across snacks and impulse lines.
Nisa retailer Amrit Singh said he had been putting a bigger focus on clearance stock since the start of the year to offer shoppers more value in light of the cost of living crisis. “Our focus has been providing more value during times when value is harder to find,” he said.
He said, however, clearance stock, particularly for Walkers and KP Snacks, had been “harder to come by” over the past few weeks. He said due to high demand for his clearance offer he is having to do ‘online-only’ clearance deals to help control stock as well as “diversify” the wholesalers he buys from to upkeep supply.
“As much as I’d want more stock, it’s not really there for me. I’m calling suppliers and nine times out of 10, they’re saying there’s nothing in the market.”
Andy Needham, MD at clearance wholesaler Morris & Son, said the nature of the market meant the flow of goods was never likely to be constant, but he agreed availability of snacking products had been impacted by most recently the war in Ukraine and also historic issues impacting suppliers. He didn’t name suppliers but alluded to the issues faced by the biggest snack producer and the cyberattack on another major supplier.
Walkers suffered distribution problems in the final quarter of last year that was understood to be linked to a major IT upgrade by parent-company PepsiCo. Meanwhile, KP Snacks was hit by a cyberattack that caused disruption to its manufacturing and shipping processes.
“I think it’s too easy to generalise and say residual or clearance stock is harder to come by at any moment in time,” explained Needham.
“The whole market is vast, covering all kinds and types of products and situations. It does ebb and flow constantly in ‘normal’ times. At present, there are a number of fairly unique factors affecting different streams in different ways and availability now is affected by events from months and even years ago.
“More recently in the snack sector, issues at the biggest snack producer put demand up at the other manufacturers, meaning more product was sold straight away as prime. The recent cyberattack on a big manufacturer again has had a knock-on impact with product flowing again through mainstream channels, and not hitting clearance triggers.”
The Ukraine war has further thwarted ingredient availability, he added, such as sunflower oil and wheat.
No comments yet