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The supplier's guide to jump starting growth

If you’re a supplier, it is often tough to achieve growth targets in food retailing these days for a host of reasons, and the recent Ahold-Delhaize merger adds to the pressure.

Bill Bishop, Co-Founder, Brick Meets Click...

August 3, 2016

3 Min Read
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If you’re a supplier, it is often tough to achieve growth targets in food retailing these days for a host of reasons, and the recent Ahold-Delhaize merger adds to the pressure. Most traditional tactics just don’t produce the results they used to, so finding growth opportunities requires taking a step back to see where larger industry developments are driving growth and tapping into that momentum.

Here are two ways to get started that are best approached and used in tandem to charge new sources of growth.

#1 Realign with the retailer’s value chain

One big way to find growth opportunities is focus on answering the question, “What challenges can I help retailers solve?”

Most of the time this means recognizing and solving/meeting two major challenges — better meeting shopper expectations, and building platforms that drive incremental growth.

Here are areas where retailers that are part of the evolving mix of stores need help. Which ones hold opportunities for your brands and products?

LARGER CONSOLIDATORS need growth to justify their investment to bring the companies together, and they need to go beyond just lowering prices to find that growth. Help large consolidators find ways to:
• Drive a differentiated shopping experience.
• Identify opportunities to expand their assortment

SMALLER FRESH STORES are a still-evolving model, but most are organized around a tightly defined product offering that often has a strong ready-to-eat assortment. Learn how to plug into their supply chain systems, and help smaller fresh stores find ways to:
• Drive up sales per square foot
• Sell more ready-to-eat food

HARD DISCOUNTERS are all about clarity of value and high-efficiency handling. Private label dominates, but there are exceptions. For example, many produce SKUs are special-pack branded items. Understand their purchase strategies and unique requirements, and help hard discounters find ways to:
• Drive efficiency of supply chain and inventory management
• Enhance gross profit without jeopardizing their price reputation

#2 Leverage the changing shopper

To make the search for growth opportunities more efficient, focus on three places where consumers are shifting their buying and spending more.

1. Shoppers want easier meals. Whether they are looking for ready-to-eat or ready-to-cook, this boils down to consumers willing to buy more value-added services with their food.

2. Shoppers are more intentional. They don’t settle – they seek out products that meet their specific needs and expectations. They know more about which specific products they want, and they seek out retailers who reflect the values important to them (local, natural, sustainable, vegan, etc.).

3. Digital connections matter, and online grocery is a growing presence. Our research at Brick Meet Click confirms that shopper satisfaction increases with more digital connections, and that online grocery is becoming a mainstream activity (1 in 5 U.S. consumers bought groceries online in the past 30 days). Digital connections are often involved in food purchases today, whether or not the transaction is completed online.

These are all areas where some suppliers can and will find opportunities to jump start their growth.

Retailers, what are you looking for from your supplier partners?

About the Author

Bill Bishop

Co-Founder, Brick Meets Click...

Bill Bishop is the co-founder of Brick Meets Click, a food retail consultancy. Contact him at [email protected].
http://www.brickmeetsclick.com/

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