Retailers have been warned more suppliers will follow Diageo’s decision in cutting supply to smaller wholesalers, as buying groups are taking precautions to protect distribution to stores.
Responding to a question about supplier consolidation at the FWD Live event on 27 June, Confex chief operating officer Tom Gittins told attendees other suppliers were likely to cut ties with regional wholesalers.
Read more: Diageo to stop supply to wholesalers under strict new criteria
He added: “It’s coming but we need to keep the conversation going for independent wholesalers and the independent market. Confex has a central distribution warehouse and we have the warehouse space. Smaller wholesalers will continue because of their amazing service, but where will they get their stock?
“We’re working with key suppliers and it’s about geography. We have members who are strategically placed. They have cost advantages for buying and making sure the smaller guys are serviced.”
Unitas Wholesale trading director Cheryl Hope added: “We’re working with a number of suppliers on that front. Central distribution is one of our key strategic pillars and we’re working hard to build and improve that. We have consolidation options to help smaller numbers. This includes maximising reach of own label. We’ve also got a number of members that are great and able to offer distribution network to smaller members.”
