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SPOTLIGHT: VASEVA QARAU OF WANIS INTERNATIONAL

THE BUSINESS MAGAZINE FOR CASH & CARRY/DELIVERED WHOLESALERS

Exclusive!

John Mills on making Landmark stronger in an unstable market

Residual stock specialist incorporates a regular C&C in its Leeds branch

CATEGORY INSIGHT

4Hot Beverages 4Sweet Biscuits 4Confectionery 4OTC Remedies

OCTOBER 2017


BE T O N N S A N C O NT EAS E M R E L S I A T R EG E L V R D O A F S THI

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Contents

October 2017

This month don’t miss... 06 6

Nisa has recommended to its shareholders a bid by the Co-op.

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A new name and a focus on a local, more personal service.

Vaseva Qarau (right) of Wanis is a firm believer in teamwork.

ESSENTIALS 05 06 42

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Editor’s Comment Industry News Products & Promotions

FEATURES 11

Spotlight Vaseva Qarau, sales manager at international food wholesaler and Today’s member Wanis.

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Interview Cash & Carry Management’s Kirsti Sharratt speaks to Landmark’s MD John Mills about his plans and priorities for the group.

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Behind the Scenes Morris & Son is hoping to entice more customers to its Leeds branch by adding a regular C&C operation after success at its Stockport site.

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John Mills (second on left) wants to create a trusting culture of openness between Landmark and its members and suppliers.

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Supplier Strategy

Product of the month

Chris Sanders, sales director at Radnor Hills, highlights the potential of school and hospital-compliant soft drinks.

CATEGORY INSIGHT 18 28 32 38

Hot Beverages Sweet Biscuits OTC Remedies Confectionery

Chris Sanders of Radnor Hills offers advice on soft drink sales.

Brand new! 100% post-consumer recycled plastic packaging.

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October 2017

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T H E N AT I O N ’ S ORIGINAL & * FAV O U R I T E T O N I C

New skittle shaped bottle and brand redesign. Available in 125ml & 200ml glass bottles, 1L PET bottles and 150ml can multipacks. Supported by a £6.6 million marketing campaign. G E T I N C ON TAC T TO F I N D O U T MOR E AT C ON N E C T @ C C E P.C OM OR C A L L 0 8 0 8 1 0 0 0 0 0 0. *Schweppes is the #1 branded product for tonic water. Based on Nielsen volume and value MAT 02/09/17 & CGA volume and value 15/07/17. © 2017 European Refreshments. All rights reserved. SCHWEPPES, the FOUNTAIN DEVICE and the 196 GRAPHICS are registered trademarks of European Refreshments.

THE U LT I M A T E MIXER


[ EDITOR’S COMMENT ]

Will it be lucky seven? t’s not uncommon in the political arena for a group of disgruntled MPs to stir up unrest in a bid to oust their party leader or the Prime Minister. The group currently wanting to unthrone Theresa May does not represent the first attempted coup, nor the last, where such a scenario is being played out. They normally falter, with collaborators failing to gather sufficient support and the original protagonists realising they have little chance. Historically in the food trade, similar protests have been directed not at an unpopular head of a company, but at that concern’s bid to merge with another business, creating unrest in the industry. Efforts to combine smaller businesses usually cause a few rumblings among other operators. But it is when the big boys attempt to become even bigger that there is a swell of disapproval. In C&C/wholesale, the largest operator in our sector, Booker, has been the focus of resentment more than once. When it took over the cash & carries trading as Linfood in the late ’80s, it created a business with well over 300 branches, but not before the takeover authorities considered pleas from other firms to stop the alliance. There was also disapproval a decade later when Booker bought Nurdin & Peacock, and again more recently when it absorbed Makro’s UK branches.

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SPOTLIGHT: VASEVA QARAU OF WANIS INTERNATIONAL

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Now the same company is facing a battle to win approval from the Competition and Markets Authority for its proposed merger with Tesco. While it, unsurprisingly, insists that the deal would benefit independent retailers, the majority view is that corner shops – once the mainstay of the C&C/wholesale trade – would be severely threatened. That’s the reason why five leading groups and two major operators (Bestway/Batleys and Bidfood) are signatories to a letter to the CMA condemning the Booker-Tesco deal (see page 7). Although comments from most of the seven were guarded, a spokesman for Bestway/Batleys told Cash & Carry Management: “While we don’t know who started it, we were probably the most vociferous in our objections. We did 3,000 customer interviews to gauge their reactions.” At the end of the month, the CMA will announce the results of Phase 2 of its deliberations and the final decision will be made early next year. While the seven dissenters will be hoping their efforts succeed, as with the bid to find a new PM, they May or they May not.

Mervyn Gilbert News Editor

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Address Winlove Publications Ltd PO Box 366 East Grinstead RH19 4ZE Tel (01342) 712100 Email mail.winlove@btconnect.com Publisher Winlove Publications Ltd EDITORIAL Managing Editor Kirsti Sharratt News Editor Mervyn Gilbert Features Editor Siobhan Kielty ADVERTISING AND MARKETING Publishing Director Martin Lovell Media Sales Manager Clare Phillips 4,570 July 2016 – June 2017 Audit Bureau of Circulations Printed by Bishops Printers ISSN 1352-254X All media rates, feature lists and deadlines can be accessed online by visiting: cashandcarrymanagement.co.uk

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October 2017

05


[ INDUSTRY NEWS ]

Sandwich supply deal Following a trial in 27 convenience stores, sandwiches carrying the Urban Eat label are being made available to all Booker franchised outlets – mainly operating as Premier – under a sale-orreturn arrangement. Some 40 varieties will be available, including chicken tikka bhaji. are There also three halal and two gluten-free sandwiches. Marketing director of supplier Adelie Foods, John Want said: “We’ve seen really positive results in the trial, with some stores reporting growth of 25%.” Adelie Foods supplies retail and foodservice customers with more than three million fresh sandwiches and 250,000 salad packs every week. a Booker Group (01933) 371000

£20,000 raised Elbrook Cash & Carry, of Mitcham, Surrey, celebrated its eighth charity gala this month at owner Frank Khalid’s Chak 89 nightspot. The event, attended by 320 people and hosted by DJ Nihal Arthanayake, included a charity auction featuring items such as signed sporting memorabilia and iconic prints. It raised more than £20,000 for the British Asian Trust, of which Khalid is a patron. a Elbrook Cash & Carry 0208-646 6502 06

October 2017

Nisa favours Co-op bid The board of Nisa Retail, the member-owned retail and wholesaling group, has unanimously recommended to its shareholders an offer of up to £137.5 million from the Co-op Group. A further £5.5 million would cover ‘associated deal costs’. The directors say that the bid, if successful, would bring significant immediate and long-term value for Nisa members, access to greater scale, access to the Co-op range, including own-label products, and retention of their independence in operating stores. The Co-op would also take on the existing Nisa debt of £105 million. As well as continuing to have a say in how Nisa is run, the group’s retailers would have the chance of becoming Co-op franchisees. A joint statement says: “The acquisition of Nisa would also bring clear benefits for the Co-op, allowing it to strengthen its presence in the wholesale convenience sector, in turn enhancing its

scale and buying power for the benefit of all customers while extending the reach of the Co-op brand into new communities.” The Co-op intends to retain Nisa as a standalone business and brand, with around 1,190 members and distribution to 3,200 stores. The aim is to attract new members to the combined business. Regional events are being held to explain the implications to members of both concerns. Nisa retailers will be asked for their approval or otherwise by early next month. Nisa chairman Peter Hartley said: “While the business has made significant strides in recent years, we

firmly believe that the combination with the Co-op is in the best interests of our members. “The Co-op offers the right blend of buying capability, convenience expertise and respect for the heritage of our business to enable our members to fully thrive in this new partnership.” The Co-op has 3,800 retail outlets across the UK, employs around 69,000 people and has an annual turnover of more than £9.5 billion. Nisa Retail’s sales in the year ended 2 April were £1.25 billion and pre-tax profit was £2.8 million. a Nisa Retail (01724) 282028 a Co-op Group 0161-834 1212

Newham schools contract renewed JJ Food Service has signed a renewed multi-million pound contract to deliver school meals on behalf of the London Borough of Newham. The wholesaler has supplied frozen foods to the east London borough for four years. Now, by adding grocery products, it is more than doubling the contract value. JJ general manager Terry Larkin said: “This is a testament to all the hard work already being done by our drivers, helpers, loaders, telesales, buyers and customer service teams.

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“We extend special thanks to our group accounts acquisition manager, Nina Grosicka, who has a fantastic relationship with Newham and worked extremely hard to ensure our tender gave us the best chance of success.” Newham is one of a small number of authorities that

provides free school meals to junior pupils as well as infants. Next spring, the catering and other services provided by Newham are being externalised as a standalone business under the name of Juniper Ventures. a JJ Food Service (0843) 309 0991


[ INDUSTRY NEWS ]

Seven object to Booker-Tesco

‘Free from’ additions

Mounted opposition. Left to right: Race, Selley, White, Mills, Robinson, Jenkins and Schofield.

The managing directors of seven of the UK’s leading cash & carry/wholesale concerns have written a joint letter to the Competition and Markets Authority urging it to block the Tesco-Booker merger. The signatories of the letter are Martin Race, of Bestway; Bidfood’s Andrew Selley; Nicky White, of Confex; John Mills, of Landmark; SPAR UK’s Debbie Robinson; Philip Jenkins, of Sugro; and Today’s John Schofield. In the letter, submitted to the CMA as part of its ongoing Phase 2 investigation, the MDs refute the claim that the deal will enhance competition in the UK and promote

consumer interests. The septet have told the CMA what they believe the consequences will be if Booker acquires Tesco’s “unrivalled power in grocery procurement”. They argue it would harm suppliers and result in higher prices and less choice for independent retailers and consumers. They say: “If the merger proceeds, Tesco will have incontestable power over the procurement of all grocery categories in the UK. Suppliers will find it even harder to resist Tesco’s demands.” Furthermore, they feel that the supermarket chain, with its ability to target lower prices where it faces local

competition, would have the power to force out of business independent retailers with which it competes locally. They add that the ‘imbalance’ between supermarkets and the C&C/wholesale sector would worsen if the amalgamation is allowed to happen. “Booker will be able to buy its products at Tesco’s prices. It will be able to drive its competitors, be they delivered wholesalers, cash & carry or symbol operators, out of business.” A provisional decision by the CMA is expected by the end of this month, and the final decision will be issued just before Christmas. a Competition and Markets Authority (020) 3738 6000

Marketing manager at Confex Gilly Hunt, who worked for Confex UK for 13 years – latterly as marketing manager – has retired. Replacing her in that capacity is Jess Douglas (pictured). Since moving to the group in Moreton-in-Marsh, Glos, four years ago as

digital assist manager from the publishing sector, Douglas has introduced an online brochure service and created an image library system for members. Confex has signed 14 new members this year (see p.9). a Confex UK (01608) 652333

development chef Paul Dickson, are being rolled out digitally. Group trading director Martin Ward said: “We hope this will allow us to reach different customers and take up more share of the plate.

Brakes is intent on having a market-leading range of top quality ‘free from’ products by 2019. Lines being launched over the coming months include a selection of sweet baked vegan foods, dairy cheese alternatives, meatfree quiches, desserts including a chocolate & coconut tart, three varieties of vegan ice cream, frozen MSC Alaskan pollock portions and meat-free meal solutions. “Over the coming year we will be educating our customers and inspiring them to add ‘free from’ to the menu,” said Louise Hatch, category manager, meal solutions. The ‘free from’ market has grown by 30% since 2015 and is forecast to hit £952 million by 2021 (Mintel). a Brakes Group (01233) 206000

Eighth branch

Nothing paltry about this! Country Range Group is this month launching “premium quality” fresh chicken breast fillets. The introduction is being supported by competitions, promotions, events and social media activity. Recipe videos, created by

Moroccan cauliflower roulade with chickpea chutney.

We strongly believe this will be the biggest launch in our 25-year history.” The chicken (200-230g) comes in 2 x 5kg trays, each containing 22-24 fillets. a Country Range Group (0845) 209 3777

Blakemore Wholesale has opened its eighth Bmorelocal… outlet – in Rotherham, South Yorkshire. The 900 sq ft store (formerly a post office) began trading after a £60,000 investment. It still offers postal services as well as a full symbol shop range. a Blakemore Wholesale (01902) 371515

www.cashandcarrymanagement.co.uk

October 2017

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[ INDUSTRY NEWS ]

Come on you girls!

Country Range Group managing director Coral Rose is urging more females to take up careers in catering, following in the footsteps of the past two winning teams in the group’s annual Student Chef Challenge. In 2016 and 2017, the Challenge, which is run in partnership with the Craft Guild of Chefs, was won by Loughborough College and Ayrshire College. Rose commented: “It’s been fantastic to see the girls dominating the Student Chef Challenge this past couple of years. Hopefully, that will only encourage more to look at the professional kitchen as a career prospect.” a Country Range Group (0845) 209 3777

Goldney to head Today’s Darren Goldney is joining Today’s Group as managing director on 13 November. The position has been filled in an acting capacity by John Schofield for the past two years following the death of former MD Bill Laird. Schofield now returns to his former post of finance director. Goldney (pictured), who graduated from Manchester University in 1992, joined Coca-Cola Enterprises as a graduate trainee. He later

occupied several roles across the grocery, on-trade and C&C/wholesale channels, including regional director for field sales & vending and

Depot staff raise over £6,000 Employees at Blakemore Foodservice’s James Bridge depot in Darlaston, Walsall, raised more than £6,000 over the past year for two charities – the Midlands Air Ambulance and Chelsea’s HLH Awareness Fund.

Money was collected through a number of activities, including the Wolverhampton half marathon, a Tryfan mountain climb in Snowdonia and a 12-mile walk. There were also several

Salmon spread New smoked salmon styles available from M&J Seafood (part of Brakes) this Christmas are Campbell & Neill ASC sides, sides in orange, fennel pollen & dill, and in yuzu, ginger & shiso, and smoked salmon lemon & herb pâté. Halibut, individually quick frozen monkfish chunks, king prawns and marinated scallops with olive oil are also available. a M&J Seafood (01296) 610600 08

October 2017

impulse sales director. Four years ago he joined dried fruit and nuts supplier Whitworths, becoming MD for brands. In 2015 he moved to Palmer & Harvey, where, until recently, he was commercial director. Today’s Group, whose chairman is Simon Hannah, MD of Filshill in Glasgow, has 146 members, with buying power exceeding £5.7 billion. a Today’s Group (01302) 249909

Representatives of Chelsea’s HLH Awareness Fund receive a cheque from some of the Blakemore Foodservice fund-raisers.

in-depot fundraisers, such as a Queen’s tea party, Disney character fancy dress day, and raffles, barbecues and cake sales. The £3,000 for the Midlands Air Ambulance will go towards the cost of three air ambulances operated and funded by the charity. A similar amount for Chelsea’s HLH Awareness Fund will help raise awareness of histiocytic disorders. Sharon Garner, Blakemore Foodservice’s ‘community champion’ said: “We are very proud to be part of an organisation that puts social responsibility high on the agenda.” a AF Blakemore (01902) 366066

More spent on food emporiums Musgrave has spent 2.5 million euros on its 73,000 sq ft MarketPlace cash & carry in the Robinhood district of Dublin. Now described as a food emporium, it features an extra 400 products, including

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260 that fit into the ‘health & wellness’ category. Customers can also shop online. The launch forms part of a 10.7 million euro investment in the chain, beginning a year ago with the 2.2 million euro opening of the

Ballymun food emporium. Over one million euros has also been invested in the Duncrue outlet in Belfast, and further improvements are planned at other branches. a Musgrave Group (0035321) 480 3000


[ INDUSTRY NEWS ]

Time sets up water charity Time Wholesale Services, of Barking, Essex, is holding a ‘Top Retail’ event in support of the Every Well Water Foundation, a new charity formed by the company’s managing director Sony Bihal. The Every Well Water Foundation aims to raise funds to help those without access to safe, clean water worldwide, repairing broken

wells and building new ones. The Landmark Wholesale member will be staging a trade show on 5 December at The City Pavilion, Romford, followed by a gala dinner.

“The trade show will enable suppliers to connect with retailers to capitalise on Christmas trading activity,” said Bihal. “It offers manufacturers the perfect opportunity to sell core range goods, promote NPD and drive up incremental sales over the busy festive period.” a Time Wholesale Services 020-8595 7830

Faster ordering online JJ Food Service has introduced a ‘one tap payment’ option for online orders placed using the company’s app. Chief operations officer Mushtaque Ahmed said: “Convenience and speed are absolutely key to our customers. With more than 50% of our online orders now coming via a mobile device, one tap payment will make online shopping at JJ Food Service faster than ever before.” It works by using details that have been captured via

the app by a card scanner and stored in the system to allow customers to check out instantly. Multiple card details can be saved at any one time.

“This means that customers do not need to manually type in credit card information, saving time and improving accuracy,” said Ahmed. One tap payment joins the wholesaler’s new fingerprint ID and card scanning facilities. “As a result of these three developments, we have reduced the time taken to place an online order by a minimum of 30%,” said Ahmed. a JJ Food Service (0843) 309 0991

Group signs 14 new members Confex UK has signed 14 additional members so far this year, which will help it reach its turnover target of £3 billion by 2020 (up from £2.83 billion over the past 12 months). Managing director Nicky White added that the group was “firmly Confex in Malta, including managing director Nicky White (third on right). on course” to achieve its goal. White – confirming data in delegates. Held over four Cash & Carry Management days, the event included 532 last month – was speaking business meetings between after the group’s fifth memsuppliers and members, as ber incentive in Malta, which well as a busy social prowas attended by nearly 100 gramme.

Plans have already been made for a similar trip next year – to Lake Maggiore in Italy from 6-9 September. Invitations will go to members showing the highest growth across selected suppliers for the February-April 2018 trading period. In the first half of this year, group turnover with Confex’s top 20 suppliers rose by 24% and volume increased by 18%. a Confex UK (01608) 652333

Striking Gold

Left to right: Imperial retail development rep Phil Woods; store owners Tony and Alan Johnson; Dave McLaren, general manager, Batleys Cleveland; and Andrew Miller, Imperial head of field sales.

A best-one retailer (and customer of Bestway/Batleys) in Stockton-on-Tees won top prize of £10,000 in Imperial Tobacco’s FCT 123! competition to promote Gold Leaf JPS tobacco. Second award of £3,000 went to a Premier (Booker) shopkeeper in Bacup, Lancs, while third prize of £2,000 was won by Premier Ultra Stores in Newport, Isle of Wight. More than 300 cash & carries and their customers took part in the competition. The winning Best-one store owner Tony Johnson said: “We’ve traditionally valued Imperial and Batleys as crucial trade partnerships. This fantastic prize will help us develop our business.” Andrew Miller, head of field sales at Imperial Tobacco, added: “This competition was designed to engage independents in a new way – in depot as opposed to in store. “FCT 123! undoubtedly helped continue to drive the brand’s volume and distribution across the country.” a Imperial Tobacco (0117) 963 6636

www.cashandcarrymanagement.co.uk

October 2017

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[ INDUSTRY NEWS ]

Profitable Booker Although Booker, like other C&C/wholesalers, continues to be hit by the downturn in tobacco trade, other parts of its business enabled the company to further improve in the 24 weeks to 8 September. Pre-tax profit grew by 9% to £88 million on sales 2.5% up to £2.6 billion. Nontobacco income rose by 7.5%, with tobacco falling by 9%. Like-for-like sales to caterers increased by 8.1%, but there was only a marginal upward shift in retail trade – 0.6%. Another split of the turnover shows that catering, coupled with small businesses, accounts for around £1 billion. Among the larger catering customers are Prezzo, Rick Stein and Wagamama. There are now nearly 3,400 Premier retail customers, 1,829 Londis shops, 176 in the Budgens chain and 61 Family Shoppers. a Booker Group (01933) 371000

Foodservice rebrand Bestway Batleys Foodservice – part of Bestway Wholesale – has been renamed BB foodservice. Bestway Wholesale managing director Martin Race said: “For years, wholesalers have been too preoccupied with what their competitors are doing to stop and ask their customers what they want. “So we listened. And we put what we learned to good use. BB foodservice is here to deliver a local, more personal service – a complete service that gives customers what they want, when they want it. So they can focus on what they do best.”

As part of the rebrand, BB foodservice is utilising 15 ‘high performing’ depots: Aberdeen, Perth, Glasgow, Edinburgh (two), Newcastle, Cleveland, Liverpool, Leeds, Manchester, Birmingham, Gillingham, Southampton, Cardiff and Plymouth. Each will supply a local fleet of delivery vehicles with a range of beers, wines &

spirits, soft drinks, chilled, ambient and frozen food, meaning food & drink outlets can rely on one delivery for both their food and drink. Race added: “This isn’t just about delivering quality products at competitive prices. From recipes, tools and calculators to our tailormade wine list design service, our support doesn’t end at the door. Whatever our customers need, our local territory sales managers are just a phone call away.” BB foodservice delivers to pubs, restaurants, hotels, schools and care homes. a Bestway Wholesale 0208453 1234

Nine quality awards for Brakes Brakes won nine Q prizes at the 2017 Foodservice Quality Food Awards, including being named as the toprated foodservice operator of the year. Among its haul were two golds, while four products were outright winners in their category.

A ‘first’ for innovation went to subsidiary M&J Seafood for its Mac & Cheese Smoked MSC Haddock Fish Cakes. This product also came first in the fish and seafood category. Brakes’ second gold was for its Christmas entry –

Stuffed Turkey Ballotine. Other winners for the foodservice operator were Yuzu Lime Pie (frozen sweets category) and Aubergine, Sundried Tomato & Feta Suet Pudding (meat-free alternatives category). a Brakes Group (01233) 206000

Blakemore charity birthday party AF Blakemore & Son has raised more than £82,000 for good causes by hosting a company-wide charity birthday party marking its 100year anniversary. Staff across England and Wales, led by chairman Peter Blakemore, took part in 300 events at stores and depots across the company’s trading area. SPAR convenience store employees collected £76,000 for Blakemore Retail’s charity partner, the NSPCC, while 10

October 2017

Chairman Peter Blakemore (bearded, centre) with staff at the company’s Wolverhampton cash & carry.

colleagues at other sites raised money for charities of

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their choice. Beneficiaries in addition

to the NSPCC included Compton Hospice in Wolverhampton, bereavement support charity 2 Wish Upon a Star in South Wales and national charities such as the Alzheimer’s Society, Macmillan Cancer Support and the Make a Wish Foundation. An inter-depot lorry pull competition also took place across the company’s distribution centres. a AF Blakemore & Son (01902) 366066


[ SPOTLIGHT ] Vaseva Qarau, sales manager at international food wholesaler Wanis

sponsored by

‘I love the thrill of the deal’ What has been the major milestone or turning point of your career? When I was asked by Sanjay (managing director of Wanis) to join the sales team here – I was a part-time receptionist, and I don’t know if he offered me the full-time job because of something I said or the fact that I called everyone ‘Darling’! Regardless, I haven’t looked back since. Who has been the biggest inspiration to you? My biggest inspiration is my late mother – she loved her family and she loved her work as a nurse. She had an amazing work ethic and she celebrated life through her spirituality and her infectious laughter. I’m proud to say I’m my mother’s daughter and she continues to inspire. I’m now a grandmother of a gorgeous grandson called Jeremih – I would buy him the world if I could. How do you maintain a work-life balance? Through working hard and playing harder! I’m not gym orientated – I have been that person who had a membership and never went. On the other hand, I have an amazing family who keep me

grounded and four cats called Neytiri, Narla, Simba and Dobby (my fur babies!). What most frustrates you in business (and in life generally)? It frustrates me sometimes when people don’t have a team attitude: it can make everyone’s life easier if we work as a team and get the job done quicker. There is no ‘I’ in team. If you had a million pounds to invest in business, how would you spend it? We have some great food and drink products in Fiji so I would invest the money in importing and promoting products from Fiji. I believe they would do really well here in the UK.

If you were able to retire tomorrow, how would you spend your time? I would travel the world first than settle back home in Fiji where I would fish and travel around the islands vlogging and generally being a beach bum of sorts. What advice would you give someone starting his/her first job? Work hard, listen, push yourself. Make yourself indispensable and go with your gut instinct. What type of business would you go into if it wasn’t C&C/wholesale? I must admit, I think I’d still be in sales. I love people and the thrill of the deal. And of course, it’s all about the banter CCM and the gift of the gab.

A natural at the (rugby and sales) pitch Vaseva Qarau joined Wanis in 2011 as a part-time receptionist, but when managing director Sanjay Wadhwani saw she had a flair with customers, she was given the chance to join the sales team as a field sales representative. She was later promoted to sales

manager, the post she holds today. Qarau has worked as a first aid officer in the FANY – First Aid Nursing Yeomanry (Princess Royal’s Volunteer Corps). She is also a former rugby player. Wanis is based in Leyton, London, and is a Today’s member.

www.cashandcarrymanagement.co.uk

October 2017

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[ INTERVIEW ]

Landmark changes: a new era In his first interview since being appointed as managing director of Landmark Wholesale, John Mills talks to Cash & Carry Management’s managing editor Kirsti Sharratt about serving the group’s members and his fears for wholesaling if Tesco acquires Booker. ebate, decide and do – that’s John Mills’ approach to business and, oh boy, does he have a lot to do in his new role as managing director of Landmark Wholesale! Not because the group is necessarily lacking in any areas, but because, he says, “this latest round of consolidation in the wholesale trade is a big tsunami”. Mills is somewhat qualified to comment, having had a long and varied career in the food and drink industry. After graduating with a degree in Business from Sheffield Polytechnic – and following brief stints as a croupier and a taxi driver – he joined Quaker Oats as a territory manager. He spent nine years there, eventually becoming national sales manager. A move to Matthew Clark led to him heading up various businesses within the fiercely acquisitive company, including Grants of St James’s Wines, Gaymer Cider Co and Strathmore Mineral Water. He was then promoted to managing director of Constellation Wines UK. He later ran InterContinental Brands, had his own consultancy Quantum Leap Management, and was managing director of tea supplier Keith Spicer. More recently, he was non-exec chairman of Hyperama for three-and-a-half years, which led to his latest role at Landmark.

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John Mills joined Landmark on the 22nd of May and flew out to Dallas for the group’s conference on the 23rd.

Cash & Carry Management spoke to Mills about his plans for the group and his views on the wider industry: When you worked for the various food and drink suppliers, did you deal directly with Landmark and/or its members? Yes. At Quaker Oats, I dealt with the Landmark head office staff and spent a lot of time with members like Bellevue, Renton’s, Martex and Lowries – that’s how far back I go. Later, when I was MD of Gaymer’s, we supplied Landmark’s and Bestway’s own-label cider. And when I ran Grants of St James’s Wines, I launched the Echo Falls brand through Landmark. So I do have a bit of ‘previous’ with the group!

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What insight did you gain as non-exec chairman of Hyperama that you have been able to bring to this job? An understanding of wholesaling. As a supplier you just do not realise the complexity, the thousands of moving parts – the high number of SKUs, the different depots, the employees, the training and legislative requirements. Then there’s the leakage (theft), the difficulty in finding, recruiting and retaining good management, the DVSA (Driver and Vehicle Standards Agency) rules for trucks, the changing health and safety landscape, the different approaches of suppliers to terms. So there are huge challenges, and there might be massive turnover but the margins are unbelievably thin, so attention to detail is essential. Landmark was always known for its focus on attracting and retaining wholesalers who were already very disciplined – in other words, the quality, not quantity, of its members. Is this still the USP and, if so, how do you balance that with the need to offer big volumes in exchange for the best supplier terms? Landmark is still about the quality, otherwise we would be just a collection of businesses with different agendas, and although that would give us buying scale, that’s not how suppliers work: they want channel disciplines. For us, it’s about ensuring we have the right offering for the right member – we have export members, foodservice members, cash & carry wholesale members. One size doesn’t fit all; we have a series of fits. My vision is for Landmark to be stronger, not necessarily bigger. If you go back to 2003 when Bestway broke away, people were saying that it would be the end of Landmark but it wasn’t. If anything, it was the right thing for both Bestway and Landmark because Bestway accounted for about 60% of our business, which was not healthy. Recently, following trade rumours, people have asked me what would happen if Blakemore Wholesale broke


[ INTERVIEW ] away. Of course, I would be very disappointed but we would survive because Landmark is run on a ‘one man, one vote’ constitutional basis and we have 38 members. Clearly, we need critical mass, but we do have a combined member turnover of £2.8 billion so even if our largest member did leave, we would still have more than £2 billion of buying power. If Tesco’s acquisition of Booker goes ahead, does that put a different light on the need for buying scale and, as such, is a link with Today’s more likely? We do need to look at leveraged buying solutions – how we can leverage our purchasing to ensure we have the competitive terms to compete with the monstrosity that the new Tesco business would be. It’s not about us necessarily merging with Today’s or SPAR or anyone else though. Two other buying groups are already members of Landmark – Country Range Group and Confex. Both are very successful in their own right but they are Landmark members because it works for us and it works for them, and in the long term it probably works for suppliers in as much as there are fewer points of contact and therefore greater efficiencies. So have those conversations started with Today’s? Or could it even mean going back in with SPAR? All I’m saying is that I’m open to any and every leveraged buying solution. We are looking at every opportunity there is – with other buying groups and nonbuying groups – to find better and more efficient ways of buying and also of distributing products to market. I am

assessing it on the basis of where we are strong and where we are not, and where the market opportunities lie. For example, we do not have a wonderful chilled proposition and we are not big in the on-trade, so there is potential for us to grow through associations with others. Similarly, if there are better central distribution solutions, we will look at them. As the new guy in charge, I have the remit to be able to do that. Do you think there is a sense of panic among wholesalers about the BookerTesco situation? Yes. Absolutely. And what is your advice to members on this? Write a letter or send an email to the Competition and Markets Authority (CMA) to say why you believe Tesco’s acquisition of Booker will be harmful. Unless there is such a public outcry that Tesco shareholders question it, the only people who can stop the deal going ahead are the CMA. That’s why I and six other wholesalers wrote a joint letter (see page 7). We wanted to get some momentum going. The CMA base their decision on the documentary evidence that is produced. It is incumbent on us to point them towards numbers and past scenarios when similar things have happened, because they are looking at ‘theories of harm’. I don’t know if it will make any difference but we had to try. I am extremely concerned that if the deal goes through it will put the independent retail and foodservice sectors at risk of massively increased consolidation that will, in turn, put dozens of wholesalers and thousands of corner shops out of business.

The format of Landmark’s annual conference will change to attract more delegates.

Landmark will create a new ‘Gold Standard’ for Lifestyle Express stores.

Did you know before you joined Landmark what you wanted to change? I have always respected Landmark. I have known its management and most of the team for a long, long time. I know its culture and I love the fact it is ‘the Landmark family’. However, if I was being critical, I would say that in the last few years Landmark hasn’t been as proactive as it should have been. And going further back, it was probably too late coming to the market with retail clubs, to the point where some members developed their own retail club formats. We should now have 3,000 quality outlets like Premier has, and we don’t have anywhere near that number. What are your plans for the Lifestyle Express fascia programme? In the last few months we have carried out a full audit of our estate. On 12 October, we had our Lifestyle Express supplier briefing in Coventry, where we updated suppliers on our plans. Lifestyle Express will be about quality, rather than numbers, and we are going to create a ‘Gold Standard’ for what a Lifestyle Express store should be like. Looking back over the 12 years since Lifestyle Express was launched, we have converted over 3,000 stores, but some of them have gone out of business, some have been lost to competitors, and some have no intention of following a core range or promotions or category advice, and yet we can’t take the fascia off them because, in most cases, it is funded by the owner. However, we now know which stores are willing to work to our ‘Gold Standard’, and we are asking suppliers to help us get those right and then we’ll grow from there.

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[ INTERVIEW ] Is there anything else you knew you wanted to change about Landmark? Yes, the annual conference. It was always a quality product but it hadn’t really developed. You will see a very different Landmark conference next May than in the past 15 years. Historically, we have gone for five nights; that’s going to reduce to three. It will run from Tuesday to Friday, so not the bank holiday Monday and not the half term, and we will try to make the business sessions more snappy, focused and interactive. We are also doing short-haul, not long-haul – it will be in Alicante next year. So that will reduce the cost. We had 158 attendees this year; I would like 200+ next year, and I want people to go away thinking they got a lot of bang for their buck. Now you have been at Landmark for a few months, what have you decided as your priorities going forward? Our national promotions need to be deep and meaningful, so we need to sharpen our focus on the top brands. We will be relaunching our national promotional brochure in January with mega deals on the top impulse lines and the KVIs. We are also doing a review of our own-brand retail range – we will be looking at product quality, the number of SKUs and whether we have any duplication. I want us to have a tighter but wider own-label range – fewer varieties and pack sizes but more product categories. For example, we don’t do cat food in a pouch at the moment, we don’t have a snacks range, we don’t really have a 500ml water that is working, so there are opportunities. For me,

Being non-executive chairman of Hyperama gave John Mills a much better understanding of wholesaling.

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John Mills (second on left) wants a culture of openness with members and suppliers.

our own-label has to offer three things: excellent quality, great presentation and outstanding value. In general, trading and marketing are my priorities. Administration, finance and legal are all pretty tight under finance director Andrew Thewlis’s control. How are you hoping to develop Landmark’s relationships with its members and suppliers? I want to create a trusting culture of openness, with zero politics. Let’s get round the table and debate, decide and do – so we don’t have the same conversations again and again. Our members are our employers: they pay our salaries and we are there to serve them and to serve them well. If we remember that, we will be okay and there will be a role for us; if we forget that, then the trouble will start. When I joined Landmark, my focus was on talking and listening to our members – I have probably visited 40% of them so far. Now my focus is on the business here, getting a handover from trading director John Searle, and in the next five or six months it will be about getting closer to our top 40 suppliers by having top-to-top meetings to agree joint business plans. We don’t need to be in bed with every single supplier – we can have purely transactional relationships – but we do want to work closely with the people who get us and who are prepared to invest in us. A lot of wholesalers are now promoting core range to their customers. Is that something you will be looking at? Absolutely. Core range is crucial. A typical corner shop is between 700 sq ft and 1,000 sq ft so it only has room for a

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certain number of lines. We already give core ranging advice – every January we publish a ‘best industry practice’ planogram for all the categories that you find in a corner shop, and every category is agreed by the top suppliers. What are your overall targets as MD? Historically, the focus has been on head office net income generated but it is now more strategic – are we growing in the right way to make us a sustainable proposition and platform for our members for the medium to long term? All of our strategies are designed to ensure that our members can survive competitively. It’s about how we can get the best prices, the best promotions, the best technology, the best retail club format. There is tons to do! Do you have the staff on your team to deal with that workload, especially as John Searle won’t be replaced as trading director? Yes. We have some incredibly experienced people here, some great knowledge. Because we are not replacing John – who takes a huge amount of experience with him – we have had a reorganisation of the buying structure. Jim Brown and Jon Burton (senior trading controllers) have dropped most of their personal buying responsibilities and will now report directly to me. How are you finding the job so far? It really suits me. People say that working for a buying group is like herding cats – but I don’t think that. I believe it’s about bringing people together, getting discussions going, making decisions and then cracking on. That’s what motiCCM vates me and I absolutely love it.


GroceryAid is the trading name of the National Grocers Benevolent Fund. A registered Charity Reg. No 1095897 (England & Wales) & SC039255 (Scotland). A company limited by guarantee, registered in England & Wales no 4620683

What are you doing to help grocery people who feel desperately isolated? Get involved and show that you’re not buying loneliness too. Call 01252 875925 or visit www.groceryaid.org.uk


[ BEHIND THE SCENES ]

Competing on another level

The relaunched Morris & Son depot is looking to challenge the cash & carry market in Leeds. The company has implemented a strategy to entice more suppliers and customers into the warehouse, which was formerly positioned as purely a residual stock specialist.

B

etter known as a residual stock wholesaler, Morris & Son is undergoing a change of image and direction. The newlook depot in the 80,000 sq ft Leeds site has been revamped to cater for an increased customer base, thanks to a new strategy implemented by owner Andy Needham, sales & marketing controller Lee Birmingham, operations director Steve Lane and head of finance Craig Wilson. “We have a simple mantra – we want to sell more product to more people, more often,” states Birmingham, who joined the company in February and is overseeing the project. “If we can do that profitably so that suppliers, retailers and ourselves all gain, then we have a successful model.” In 2012, Morris & Son acquired its Stockport cash & carry, a 10,000 sq ft site that specialises in confectionery

and soft drinks. The C&C operation has proven to be a successful model and is now benefiting from the addition of even more soft drink lines. The Leeds site is a less straightforward space that has, until now, been known as a residual stock specialist as well as housing the Morris & Son offshoot concerns – the warehouse holds short-dated, end-of-line, end-of-promotion and surplus stock and works sympathetically with manufacturers to clear and sometimes debrand products. This function already has a loyal customer base but Birmingham wants to increase customer numbers and has looked to draw on the success of the Stockport depot to expand the proposition for retailers. With the space available at the company’s Leeds branch, the team has managed to incorporate a regular cash & carry into the warehouse without

Owner Andy Needham (left) and sales & marketing controller Lee Birmingham are hoping to replicate the success of the Stockport depot at its Leeds branch.

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sacrificing the residual stock, therefore creating a dual-purpose depot that attracts different types of customer. “We’ve almost zoned up the depot,” explains Birmingham. “The back of the warehouse is residual stock, the front features two or three clearance lines as footfall drivers and the rest of the warehouse contains branded, full-price SKUs covering non-food, grocery, crisps and snacks, confectionery and soft drinks. In Leeds there aren’t that many C&Cs; we want to be there as the one-stop shop for retailers who already buy residual stock from us but currently buy other products from a different cash & carry.”

‘This is a business that can change and adapt to suit’ The depot has been given support through membership of buying group Sugro, which has helped to develop supplier relationships, an area where Birmingham had to overcome the challenge of manufacturer preconceptions of Morris & Son. “Having traditionally worked with large manufacturers in providing a clearance service for residual stock, we’re now looking for new relationships and have had to explain the journey being undertaken, but suppliers are now coming on board,” he says. Birmingham is well placed to develop these relationships, having spent more than 20 years at that end of the supply chain with Cadbury. “We are actually a lower risk, as we already have the facility and the customer base to sell clearance if lines don’t work as fullprice, regular stock. What we’re aiming for is a change of direction but not forgetting our roots.” The realignment has been several months in the making, having started in April with a trial of one confectionery aisle with products brought over from the company’s Stockport site. The positive reception to the initial 80 lines led to


[ BEHIND THE SCENES ] an increase to around 500 lines in the confectionery, crisps and snacks categories, and work has been continually undertaken since to enable the official October relaunch of the Leeds depot, after a soft launch in August. Range selection has been picked from the Stockport best-sellers and the buying team now includes a dedicated buyer for regular lines for the Leeds depot. Although Stockport has a large range of pick ‘n’ mix and American candy, Birmingham has not yet chosen to follow that route, saying that he wants to “walk before we can run”. The Leeds pricing strategy follows that of Stockport, which has proved competitive, and the retailers are receptive to the new direction: “We want to attract new customers – we recently set up a deal with a chain of forecourts, and we’re trading with some symbols and independents who are finding out that we now do much more than just residual stock,” says Birmingham. His targets include enrolling 50 Sugro retail club members by the end of the year, as well as expanding the 600+ customer base. With the addition of a van to the delivery fleet, city centres will also be easier to incorporate into delivery routes. The changes have all taken place without affecting daily trading, and the company has utilised the staff already available through upskilling and reshuffling. In fact, this approach of making the most of existing resources is reflected throughout the process, from the appropriation of the Stockport merchandise through to the layout plans that are based on making better use of the space available; indeed, the entire strategy is based on adapting the existing

model to attract new business. “When I met Andy Needham, I was blown away by how multilayered this business was,” says Birmingham. “This is a business that can change and adapt to suit.” Operations director Steve Lane works alongside Birmingham to ensure that the layout now has a flow that makes it the easiest to shop for the retailer, and a commitment to using PoS materials is playing a big part in ensuring visibility, with tower ends available to suppliers as advertising space. “From my time on the supplier side, I know that not all C&Cs want suppliers’ help, but we relish it,” says Birmingham. “We’re also looking at category management and welcome manufacturer input. It’s almost as if we are start-up enterprise from our willingness to listen to manufacturers, but we have the security of being an

established business that is changing direction slightly.” It’s not only the suppliers that Birmingham has established a new rapport with; customers are also being kept informed thanks to Morris & Son’s entry into social media and an updated website. “Getting people through the door is tough – they have less time on their hands now,” declares Birmingham. “We have the same staff and the same friendly approach. We’re keeping the ethos and simplicity while changing the range and focus.” Morris & Son’s change of image and direction is an admirable use of vision, creativity and available resources. “It’s a challenge we’re relishing, and it’s all our own people seeing it through,” says CCM Birmingham. Morris & Son (0113) 235 0553

Flexibility is key Morris & Son’s owner Andy Needham adopted a multi-stranded approach to open up new opportunities. As well as the two C&C sites, the company has bagging and packing facilities for rebranding goods, a popcorn manufacturing plant and an artisan biscuit company, Cottage Cookies. The staff are as flexible as the business – even the biscuit bakers have joined C&C staff to help facilitate the company’s new direction!

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[ HOT BEVERAGES ]

Changes are brewing The hot beverages market is seeing influences from the café culture and health trends, with consumer behaviour out of home leading to a shift in shopper demands down the aisles. Faced with wider choice and changing needs, does your depot have the right blend?

All data unless otherwise stated: IRI/Kantar

H

ot drinks are an important sales driver in retail and foodservice, with shifts in consumer behaviour leading to an increase in choice. The hot beverages category is worth £1.97 billion a year and has grown by 1.8% over the past five years. “It’s not just tea that is creating value for retailers within the convenience and foodservice sectors, with coffee, iced drinks, pods and chocolate having a role to play in creating a diverse offer that meets customer needs,” says David Rich, channel business manager UK & Ireland at Twinings. “Within the convenience channel, shoppers are increasingly looking for a wider range of products to complete topup shops, with 56% of hot drinks missions in convenience being top-up (Tea Advisory Council). Therefore, in what can be an increasingly complicated sector to get right, wholesalers have a crucial role in helping to demonstrate to retailers how to maximise the hot drinks category, through stocking the right products in an inspiring and interesting offer.” 18

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Ranging is a crucial element to ensure that symbols and independents reflect the success of the category, as sales of hot beverages have shown a decline of 2.1%, against total convenience channel growth of 0.6% in the last year. “Wholesalers that tap into the latest beverage and flavour trends will thrive by delivering a diverse and varied offering to their customers,” advises Tom Noonan, senior brand manager at DaVinci Gourmet. Coffee shoppers are shown to have a higher average basket spend than tea buyers, at £3.77 compared to £2.62. Instant coffee is still a major driver, with £818 million in sales. While the everyday segments of regular, decaf premium and specialist coffees represent the major proportion of sales with 71% value share and 84% cup share, the higher penceper-cup segments of super premium, frothy coffees and ‘In1s’ are growing quickly, with their sales rising overall by 41% and £64 million over the last five years. To make the most of the category opportunities, it is


We’ve been making quality coffee simple since 1923. To celebrate our new look and help you increase sales of Kenco coffee, we’re giving all professional customers who buy a tin of Kenco coffee before the end of 2017 the chance to win a £1923 Amazon voucher with every purchase.

YOUR CUSTOMERS CAN ENTER AT

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For in store point of sale and more details on how your business can benefit from this promotion please contact: Charlea.Samuel@JDEcoffee.com Win an Amazon voucher for £1,923. To enter your business must purchase one of the following: Kenco tin range Kenco Smooth 750g, Kenco Rich 750g, Kenco Decaff 500g or Kenco Millicano 500g and submit your details to www.win1923.co.uk. All entrants must have the permission of their employing business to enter. The winner must be able to provide proof of purchase in order to collect their prize. Competition runs from 9th October to 31st December 2017. Terms and conditions apply, see www.win1923.co.uk


[ HOT BEVERAGES ] recommended that an average independent convenience store allocates two shelves to hot beverages: the top dedicated to an instant coffee range based on best-selling SKUs, the lower shelf dedicated to tea and hot chocolate, ensuring that the full range is consistently available – hot beverage shoppers are more likely than the average to go elsewhere if their preferred brand is not there, or is out of stock (Golley). Taylors of Harrogate has added to its Craftsman roast and ground coffee range with two price-marked packs produced exclusively for wholesale. The new SKUs are part of the supplier’s rebranding this year across its tea and coffee ranges, bringing them under a unified proposition. “We understand how important price marking is for the convenience sector and we are delighted to be able to relaunch our most popular blends, Rich Italian and Decaffé, with new pricemarked packaging,” says channel controller Helen Boulter. “The new packs showcase the quality and premium nature of the Taylors range while delivering the trust and value message we know shoppers are looking for from their convenience shop.” The packaging features a new logo and illustrations from artist Izutsu Hiroyuki. The 227g packs have a £3.79 flash. UCC Coffee has focused on the source for its recent activity. Project Waterfall has been supported by the manufacturer’s Lyons Coffee brand after partnering up last year and donating part of the proceeds of every pack of coffee bags sold to help provide fresh water to poor coffee-growing communities. Project Waterfall has brought clean water to more than 27,000 people in Rwanda, Tanzania, Ethiopia, Uganda, Kenya, Vietnam and Nicaragua, and Lyons has been instrumental in funding a number of projects in coffee growing communities, including bringing clean drinking water and sanitation to the Kibebe Tsehay orphanage in Addis Ababa. Earlier this year Nestlé UK ran a ‘Give a Friend a Big Start’ campaign as part of a £2 million media investment. The brand leads the everyday regular segment of the coffee category, with 64% of sales (IRI). In the £260 million premium coffee segment, Nescafé Gold is the No.1 brand, with a share of more than 39% (IRI/ Kantar). The brand’s September relaunch incorporated a new recipe and redesigned jar, and is being supported by a heavyweight campaign that includes a £7 million spend in the first six months. The brand has also seen activity in the £88 million frothy coffee segment, where this year’s £6 million media campaign and repackaging have generated growth of £5.7 million year on year. The frothy coffee segment is one driven by impulse purchasing, and should be merchandised accordingly – 46% of shoppers decide to buy the product while in store so excellent product visibility is critical for driving sales. 20

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Nescafé has seen growth following activity in both in the premium and super-premium coffee sub-sectors.

Another best-seller is Nescafé Azera, which holds a 52% share of the £85 million super-premium segment (IRI). The brand, which has grown by 14% year on year, has seen sales increase through last year’s launch of Nescafé Azera Coffee To Go, which was supported by a £7 million communications campaign. The NPD delivered £5.4 million in sales in its first year, driving incremental value for retailers and encouraging shoppers to change their coffee-shop habits. Again originating from the café culture, the use of coffee machines is becoming a daily habit for many consumers, with 20% of UK households now owning a coffee machine. The pods category is expanding at a rapid rate – an average of £29 million per year for the last four years – and Nescafé Dulce Gusto’s latest addition to the segment is the Preludio variant, which targets the breakfast occasion. There are, however, still many of out-of-home opportunities for coffee, and flavour trends can boost profits, insists DaVinci Gourmet’s senior brand manager Tom Noonan. “Across the UK, many consumers want to enjoy coffee without its natural bitterness, especially younger people, and as a result look for a sweeter taste. Introducing the option of flavour combinations to a speciality beverage offer is essential for those operators looking to keep up with the trends.” The supplier’s DR:NK digital publication offers insights and recipes to café operators. “Coffee is the biggest beverage category out of home, driven by consumers’ increasingly explorative tastes and raised expectations,” he says.

Consumers are choosing to replicate their out-of-home experiences, leading to increased higher-margin sales.


BOUGHT BY MORE HOUSEHOLDS THAN ANY OTHER TEA BRAND*

*Kantar 20.5.2017


[ HOT BEVERAGES ] Focus on sustainability The British Coffee Association (BCA) has published its first Sustainability Mission statement, outlining the key objectives that it believes will help enable the sector to continue to grow as a fully sustainable industry. This comes shortly after the creation of the BCA’s Sustainability Committee, co-chaired by Krisztina Szalai from Taylors of Harrogate and Victoria Moorhouse from Costa Coffee. Central to the BCA’s Sustainability Mission is the identification of three priority areas: Working towards a circular economy for the UK coffee industry Driving responsible sourcing practices that enhance existing standards Improving the long-term resilience of coffee farmers at origin.

• • •

Source: The British Coffee Association

Jacobs Douwe Egberts is looking to further support wholesalers through category advice and a customerfocused promotion. “With a clear objective for the coffee category and by choosing the right partner, such as JDE, wholesalers can benefit from the latest industry insights, expertise and advice on best practice,” says category marketing manager Martyn Bell. “This could be learning about the breadth of categories available or understanding the price tiers required to deliver a range of well-loved brands that meet customer needs.” The supplier is offering its customers a chance to win £1,923 for business use by purchasing Kenco and entering a prize draw online at www.win1923.co.uk with their contact details and receipt/invoice number. JDE’s Kenco investment also includes a £6 million campaign with a new look for the brand, along with a TV advert airing next year. Reflecting the category-wide focus on the premiumisation trend, JDE’s Kenco Millicano is recommended as an instant solution for barista-style coffee. “Consumers have never been more demanding in their quest for high-quality coffee,” says Bell. “This has a major implication for wholesalers, who need to think carefully about the range offered in store, online or through sales brochures.” Rombouts’ newest coffee launch, Organic Expresso, combines premium quality, organic and Fairtrade Arabica beans from Laos, Honduras and Congo. Recently launched for the foodservice sector, it works both as an espresso and also in milk drinks such as cappuccinos, lattes and flat whites. The launch marks another step in Rombouts’ positioning of itself as a complete hot beverage solution, after the earlier introduction of its Majes-T range of organic teas and infusions to the foodservice industry. 22

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Tea-time habits Tea continues to be a UK favourite, although consumer trends are once again causing a shift in category innovation, with new flavours and ‘healthy’ teas being introduced alongside the standard black varieties. Younger consumers are a target demographic, driving growth in premium and speciality styles. Green tea and infusions have grown by 5.6% and 2.5% respectively (Kantar). “Tea now accounts for 27% of all out-of-home hot beverage servings in Britain (NPD Group),” says Tom Noonan, senior brand manager at DaVinci Gourmet. “Complex and inventive tastes and essences are becoming ever-more apparent. Matcha, acai and hibiscus are all on the rise and through adding interesting flavour combinations to their menus, operators will be sure to entice different consumer taste buds. Moving into autumn, a Camomile, Honey & Ginger Soother is the perfect pick-me-up drink.” Tata Beverages advises foodservice operators to keep their range relevant to make the most of the 31% average increase in breakfast out of home. “English Breakfast is always a favourite, but speciality teas are growing in popularity, with purchase out of home up 2.8% year on year,” says Marshall Kingston, Tetley senior brand manager – out of home. “Additionally, breakfast is a key area of growth for fruit and herbal teas, with 28% of purchases occurring between 6am and 9am.” Tetley also plays a major role in the convenience sector, where the same strategy of range consideration is advised. “Across the market the performance of tea has been affected by the continuing dominance of everyday black tea and the decline in sales of these products,” says business sector controller Brett Grimshaw. “Wholesalers and their customers risk missing out on sales if they don’t stock products from the growth areas in tea. With careful selection of the right

Purchase of speciality teas is up by 2.8% out of home.


[ HOT BEVERAGES ]

Make the most of supplier display materials offered to increase footfall and showcase the range in-depot.

range there are big returns to be had from the highermargin products in the healthier sectors. Products in the growth areas that fit shopper demand will sell the best and deliver higher value.” Grimshaw also advises wholesalers to liaise with suppliers to bring attention to their range in-depot. “Initiatives don’t have to be complicated; a simple mechanic can work just as well,” he says. “Footfall through depot is paramount and wholesalers should look for ways to give their depot the edge over local competition. Corporate initiatives such as prize draws, trade open events and competitions all help build loyalty, and tower displays and branded points of sale can drive uplift.” Tetley’s mock Tetley Tea Folk delivery vans, used in-depot to showcase the tea range, tripled case sales where they were employed. Similarly, Tetley’s ’virtual gaffer‘ has led to sales uplifts of 26% over the previous year. Twinings echoes the importance of category management to ensure that retailers can negate the effects of the decline in black tea. “Wholesalers can help educate retailers about the different variants by segmenting depot fixtures by sub-sectors (standard speciality, green, infusions, etc) so that retailers can more clearly understand which products fit into which segment. Where possible, accompanying on-fixture PoS can help retailers understand the number of varieties of each sub-sector they should aim to stock and how to replicate the clarity of the depot layout in their own store,” suggests David Rich, channel business manager UK and Ireland.

He continues: “Retailers are advised to stock one to two products in the key sectors such as green and speciality from the leading brands that shoppers will recognise and trust, and this should be reflected in a wholesaler range.” The two best-selling speciality black teas are English Breakfast and Earl Grey, the top two green teas are Pure Green and Green & Lemon, and the two leading herbal infusions are Pure Peppermint and Pure Lemon & Ginger. Unilever introduced its Pure Leaf range earlier this year, supported by a £2 million marketing investment, to attract those looking for a move away from the traditional. “We know that Britain is a nation of tea lovers and there is a growing trend for speciality and herbal teas; we are aiming to capitalise on this opportunity with the launch of Pure Leaf. The range has been expertly crafted to deliver a genuine teadrinking experience so consumers can enjoy the taste of pure tea,” says Nisha Singadia, brand manager for Pure Leaf. The eight tea-bag variants (rsp £3.99) and two loose-leaf variants (rsp £5.99) are all ethically sourced – another factor that is growing in importance with today’s consumers. “Undoubtedly, there has been a decline in tea sales in recent years, driven largely by deep-cut price discounting on standard tea,” says David Rich, channel business manager UK & Ireland at Twinings. Despite the decline of around 4% of tea sales in the convenience channel, it is still a sector

Serving the convenience market An overview of tea performance in the convenience channel: % volume share black teas: Total market Convenience Impulse

of overall tea sales given to everyday 78.8% 86.1% 94.1%

Convenience sector performances of tea: Overall tea sales -1% value, -4.6% volume Everyday black tea -1.9% value, -5.3% volume Decaf tea +8.2% value, +3.8% volume Green tea -2% value, -1.5% volume Fruit and herbal tea no change value, -2.9% volume Speciality tea +1.1% value, +0.5% volume Redbush tea +0.7% value, -14% volume Top tea brands in the convenience channel: By value: By volume: 1. PG 26.5% 1. PG 31% 2. Tetley 20% 2. Tetley 23.5% 3. Twinings 19% 3. Yorkshire 14.8% Best-sellers by sub-sector: Black 1. PG 2. Tetley Green 1. Twinings 2. Tetley Decaf 1. Tetley 2. PG Data from Nielsen, provided by Tetley

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[ HOT BEVERAGES ] Retailer viewpoint At Kirby-le-Soken Post Office Stores in Essex, a customer base with established habits means that traditional shopper behaviour has not necessitated changes in the hot beverage category. At the same time, the store is benefiting from incremental sales through its hot drinks offering. “The most popular togo beverage is coffee, followed by tea then cappuccino, and the bestselling categories are sandwiches, cakes, crisps, chocolate and cold drinks,” says owner Lee Bond. “There is no availability issue stocking the category, with everything readily available from Booker and P&H.”

worth £33 million annually (Nielsen) and is one which consumers rely on for a top-up mission; therefore, growth in tea innovation should not eclipse the traditional core offering. “While standard, traditional tea sales may be in decline, wholesalers should maintain their offer across the standard tea fixture but adjust their speciality range to accommodate new variants and flavours of teas and infusions that will meet the evolving needs of customers and drive average margin in the sector,” he advises.

Chocolate in a cup “Although tea and coffee dominate hot drinks preferences both in and out of home, hot chocolate and malted drinks still generate significant sales and remain an important element of a retailer’s offer,” says Rich. “Almost half of all households buy into the sector over the year, generating over £6 million in sales for the convenience channel (Nielsen).” Twinings’ leading malted brand Ovaltine achieves nearly £400,000 in sales annually. The malted drinks category is worth £1 million to the convenience channel annually, and almost one-third of convenience stores stock at least one brand. In the hot chocolate category, Twinings’ Options has tapped into the guilt-free trend with its low-calorie range, in which Belgian Choc is the key variant. Mars Chocolate Drinks & Treats has also amassed a range catering to the various consumer need states in the hot chocolate and malted drinks markets, which together have an annual sales value of £117 million (IRI). “Combining strong brands, exciting and innovative products, and offering flexibility for retailers and consumers has seen our range continue to grow,” says Michelle Frost, general manager. “The complete range now includes options for those seeking a low-calorie, malted or indulgent hot chocolate.” Category management advice from the supplier includes displaying hot chocolate near tea and coffee, and retailers 26

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should ensure that they stock a wide range of products from the core hot chocolate segments for most impact – instant hot chocolate, added milk, malted and cocoa. Again, consumers are replicating the coffee-shop experience and seeking premium products. The supplier extended its Galaxy Ultimate Hot Chocolate range to include a 275g jar of Galaxy Ultimate Frothy Hot Chocolate, adding to a Galaxy line-up that generates value sales of more than £4 million. Within the brand, Galaxy Lightstyle caters to demand for low-calorie hot chocolate, a sub-sector that accounts for almost half of the instant hot chocolate market. Meanwhile, Maltesers Malted Chocolate brand, worth £1.4 million, has claimed a 14% share of the instant malted drinks market. Mondelez International has the leading market share of the chocolate beverage market with its Cadbury brand. Looking at consumer health trends, low-calorie hot chocolate has been an important part of supplier focus, and the Cadbury Highlights range was relaunched last year with a new design and reformulation to contain less salt. Highlights holds the No.2 position in the diet chocolate beverages subcategory. The Cadbury brand also has the best-sellers in the drinking chocolate, instant chocolate and cocoa sub-categories, and Mondelez is looking to increase growth in the market. “We believe the drinking chocolate category has significant headroom for growth, as currently only one in two households buy hot chocolate (Kantar), yet it is a highly popular drink in the out-ofhome market thanks to the rise of the café culture,” says trade communications manager Susan Nash. Last year the supplier carried out a ‘Make Winter Wonderful’ campaign, promoting Cadbury Drinking Chocolate through in-store, digital and sampling activity. Nash comments: “As the leading brand we are committed to innovation and investment to help drive CCM growth in the category.”

For further information: DaVinci Gourmet (01784) 430777 Jacobs Douwe Egberts (0800) 470 8031 Mars Chocolate Drinks & Treats (01753) 550055 Mondelez International (08702) 400861 Nestlé UK 020-8686 3333 Rombouts (0845) 604 0188 Tata Global Beverages 020-8338 4000 Taylors of Harrogate (01423) 814000 Twinings/SHS (01452) 378500 UCC Coffee (01908) 275 520 Unilever UK (0800) 731 1597


[ SWEET BISCUITS ]

Balancing bestsellers with NPD Although 80% of biscuit sales in the convenience channel come from 8% of products (IRI), innovation is important in keeping the category exciting and relevant for consumers. he UK sweet biscuit category has remained steady during the past year and is currently worth £1.87 billion (Nielsen). Manufacturers have responded to increased consumer focus on health by launching ‘healthier’ biscuits alongside different biscuit formats, such as ‘thins’. At the same time there is a trend towards indulgence. Within the sweet biscuits category, special treats account for over £159 million of sales and are continuing to gain value share, growing at a rate of 2.2% year on year (Nielsen). “A delicious biscuit is still very important to consumers – when a consumer reaches for a biscuit it has to be a truly worthwhile moment,” comments Julien Lacrampe, trade marketing manager at Bahlsen. The company’s offering in the special treats sector is the Choco Leibniz range, with the Milk Chocolate variant alone accounting for 37.7% of Bahlsen’s growth and driving the most value. Choco Leibniz biscuits are available in Dark Chocolate, Milk Chocolate, Chocolate Orange, White and Caramel, with an rsp of £1.50. Additional trends within the sweet biscuit market are portion control, pack size and shareable snacking formats. Bahlsen’s £1 price-marked mini-bag range, spanning its Choco Leibniz, Messino, Waffle and Zoo brands, was added to the product line-up to respond to this demand. A recent addition to the Bahlsen portfolio is PiCK UP! Minis, individually-wrapped biscuits available in two flavours: Milk Chocolate, to mirror the existing best-selling PiCK UP! variant, and new Choco & Milk. The original PiCK UP! five-pack is over-performing in the chocolate biscuit bars segment, having grown by 58.3% year on year (Nielsen). Unisnacks has introduced a new ‘Play & Win ££££’ promotion on Hello Panda, offering consumers an opportunity to play and win cash prizes by downloading apps. The campaign will be backed by publicity of 10 million Facebook impressions for participating outlets. Hello Panda ‘fun-filled biscuit treats’ were launched in 1982 and are now sold in over 85 countries. The brand has been distributed in the UK since 2008 by Unisnacks and is currently available in over 4,000 independent outlets and cash & carries including Dhamecha and United Wholesale (Scotland). The biscuits are offered in six flavours and

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four different pack sizes, with a minimum margin of 47% for the trade. Mondelez International has launched Cadbury Crunchy Melts – crunchy chocolate chip cookies with a soft melting centre. The cookies, which can be heated in the microwave, come in 156g packs of six cookies in three variants: Chocolate Centre, Double Indulgence and Soft Cookie Centre. There are 12 packs (rsp £1.89) to a case. A £1.29 price-marked pack is also available for the Chocolate Centre variant. Marketing manager Chiara Missio comments: “Sales of traditional everyday biscuits have been declining as shoppers seek more premium experiences in the treat segment (Kantar). We believe that this launch will be a hit with those consumers trading up by offering a premium and fun sweet treat that stimulates the senses from the nation’s favourite chocolate brand.” Cadbury Crunchy Melts will benefit from a new TV campaign for Cadbury biscuits and will be supported with in-store activity. The launch follows the introduction in April of Cadbury Roundie, which achieved £2.1 million in sales in just 10 weeks. The biscuits are available in five-packs in Milk Chocolate, Dark Chocolate and Caramel Wafer variants, with the Milk Chocolate style also available in a single format. Other recent NPD from Mondelez includes Oreo Choc O’Brownie. This followed a public survey, in which 43% of respondents voted for a biscuit featuring a chocolatey, brownie batter centre in the iconic Oreo cookie. The launch is being backed by a £2.5 million spend. Oreo is currently valued at £50 million in the UK and is growing at 14% (Nielsen). Mars Chocolate Drinks & Treats recently unveiled a selection of chocolate cookies that tap into the popularity of some of its leading confectionery brands. Galaxy Chocolate Chunk Cookies contain real Galaxy pieces, Bounty Soft Baked Cookies feature flakes of coconut and chocolate chunks, and M&M’s Chocolate Cookies have real chocolate M&M’s inclusions. Everyday treats (including cookies) is the largest segment of the sweet biscuits market with a share of 18%. It is currently worth £0.5 billion and growing by 2.2% in value sales (Nielsen and Kantar).


[ SWEET BISCUITS ] Michelle Frost, general manager at Mars Chocolate Drinks & Treats, says: “We believe that the strength of our brands will really enliven the cookie category. Not only does this range benefit from brand recognition and fantastic, eyecatching packaging, but it boasts an authentic taste too!” The new cookies have an rsp of £1.99 and come in packs containing eight cookies, with eight packs to a case. They are available from Burton’s Biscuits. According to Burton’s, the cash & carry/wholesale trade can boost biscuit category sales by taking more account of the reasons shoppers are buying biscuits and by merchandising the depot accordingly. “Demand for biscuits in the impulse channel is growing faster than the total market,” says Mandy Bobrowski, UK & Ireland marketing director. “Customers shop by mission, with a third of all biscuits bought on impulse in the convenience channel. The main reasons that people buy biscuits are as a top-up because they’ve run out, they’re looking for a family treat or they’re buying for a special occasion. “With so many opportunities to grow biscuit sales, it’s crucial that cash & carries signpost the biscuit category in-depot with the right PoS to direct retailers to marketleading products and NPD.”

In June, Burton’s relaunched its £50 million Maryland brand with a range-wide packaging update, new Maryland Thins and a social media campaign. Maryland Thins come in two flavours, Milk & Dark Choc Chip and Salted Caramel (rsp £1.49 for a 128g pack). They are available in shelf-ready packaging in cases of nine. “Maryland remains the nation’s No.1 cookie brand, growing at 10% year-on-year (Nielsen) and gaining an additional 800,000 households in the past year alone (Kantar),” says Bobrowski. “The new designs ensure Maryland remains relevant and contemporary, while the addition of Maryland Thins enables retailers to attract younger shoppers to the category through new and exciting products targeting afternoon snacking.” Following the introduction by pladis of McVitie’s Digestives Nibbles, the biggest sweet biscuit launch of the decade (Nielsen), the company has announced the addition of a Milk Chocolate Orange variant to the range. The new line is available in a 120g sharing pouch, with an rsp of £1.99. The Digestives Nibbles range has a forecasted retail sales value of £20 million for 2017 and has been supported with a £4 million integrated marketing campaign throughout the year. 30

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McVitie’s Digestives Thins is another recent innovation from pladis. Offered in three variants – Milk Chocolate, Milk Chocolate Cappuccino and Dark Chocolate – the product has been developed to attract a younger consumer and the range has a forecast retail sales value of £12 million for its first year in market. According to pladis, 80% of biscuit category sales in the convenience channel come from only 8% of products (IRI), so stocking the right range is vital. “Biscuits cover a wide variety of need states from treat through to health, so having a balanced range with products to cater for every need is crucial. Having multiple versions of the same product type does not add up to additional sales, therefore reducing duplication within the range to declutter the fixture is key,” says trade communications controller Hena Chandarana.

‘Reducing duplication within the range to declutter the fixture is key’ Hena Chandarana, pladis’s trade communications controller The company has a convenience-specific category advice programme, ‘Better Biscuits, Better Business’, to help retailers make effective changes in-store to drive sales. Recent introductions focus on providing better value for shoppers. These include a 89p McVitie’s Biscuit Barrel range that brings together some of the UK’s best loved biscuits under the McVitie’s name. “This launch has received fantastic feedback from retailers and wholesalers as the packs offer great value with an improved cash and percentage margin opportunity for both wholesaler and retailer,” says Chandarana. Similarly, the McVitie’s Chocolate Digestive £1.50 PMP range “offers a more competitive headline price in line with multiple c-stores and will drive base sales of the bestsellers,” she notes. The packs also allow retailers to make a “significant margin”, thanks to a new case size containing three free packs (15 packs for the price of 12). Also for the convenience sector, pladis is rolling out a new McVitie’s PoS display unit. This is not much wider than a packet of biscuits, but in trials it delivered a 4.8% category uplift, equivalent to an annual increase of over £700 in sales CCM per store.

For further information: Bahlsen (01923) 728500 Burton’s Biscuit Company (01727) 899700 Mars Chocolate Drinks & Treats (01753) 550055 Mondelez International (08702) 400861 pladis 020-8234 5000 Unisnacks (0800)195 6438


THE NO1 MEDICATED

CONFECTIONERY

*

Fastest selling product in the market**

• Soothing relief • Clearing menthol action • Sugar free options available

STOCK UP FOR THE COLD AND FLU SEASON For great category advice go to deliciousdisplay.co.uk * As defined by Nielsen MAT to w.e. 26.08.17 **Soothers blackcurrant Nielsen MAT to w.e. 09.09.17


[ OTC REMEDIES ]

Take a dose of healthy sales Wholesalers can help their retail customers tap into the trend of consumers choosing to treat minor ailments themselves by offering the key brands in each OTC remedy category. hile over-the-counter (OTC) remedies may not have been a core category for cash & carry/wholesalers or convenience retailers in the past, consumer trends are changing, with less reliance on doctors and pharmacies for medicines and treatments. Consumers are instead looking for the ease of selecting effective and recognised treatments in their local store. Indeed, research has shown that 92% of consumers want to take more responsibility for their own health and would be prepared to purchase OTC remedies for treatable illnesses rather than using NHS services (PAGB). “OTC medicines are most often a planned purchase, with a distressed shopper needing quick, convenient and effective relief to treat their symptoms,” points out Jon Atkins, customer business manager at GlaxoSmithKline (GSK). “This leads to a high conversion factor, with 88% of shoppers buying a product once in store, if they can find the one they are looking for (GSK internal research). “However, as shoppers will mainly have a brand and product in mind when entering a store, it is vital that a retailer stocks the well-known and trusted market leaders. The wholesale channel is at the heart of maximising this opportunity by ensuring they have the brands, formats and varieties that retailers need to stock to meet customer needs.” According to GSK, pain and coughs and colds are among the most frequently suffered ailments and are also the most treatable through self-medication. Therefore, these categories are the most important for wholesalers and retailers to focus on. However, shoppers will also be looking for products to treat symptoms including cold sores, indigestion and heartburn, allergies and cuts and grazes. To unlock sales, wholesalers and retailers should ensure they have a strong

W

Top 12 OTC remedy categories in impulse (Nielsen May 2017)

1

Medicated confectionery (£30.8 million)

2

Adult oral analgesics (£29.5 million)

3

Cold & flu decongestants (£15.7 million)

4

Indigestion remedies (£8.5 million)

5

Paediatric analgesics (£7.1 million)

6

Cough liquids (£5.1 million)

7

First aid (plasters, cream, liquid) (£3.9 million)

8

Anti-diarrhoea (£2.8 million)

9

Hayfever remedies (£2.8 million)

10

Oral lesion & toothache (£1 million)

11

Upset stomach remedies (£684,000)

12

Topical analgesics (£624,000)

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Both brands are benefiting from heavyweight media support.

branded presence as market data suggests that OTC is a heavily branded category, with minimal sales in own-label. Within the wholesale & convenience channel there has been a decline of 3.2% in healthcare sales in the last year, although GSK brands are significantly outperforming this, with sales of its brands growing by almost 5% in the channel (Nielsen). Over the winter season, GSK is investing almost £3 million in promoting Beechams to help consumers understand the full portfolio and feel more confident in choosing the product that is most appropriate for their specific symptoms. The Panadol brand will also benefit from a major campaign in spring 2018, with poster advertising at locations such as bus stops and tube stations to promote the unique technology that enables Panadol to position itself as faster acting than other brands in the market. SHS Sales & Marketing has accumulated decades of experience working in the over-the-counter remedies sector, representing leading brands such as Lemsip, Beechams, Benylin, Panadol, Nurofen and Gaviscon. As winter begins to draw in across the UK, consumers are gearing up to fight the seasonal surge in cold and flu bugs and stocking up on gastro remedies ahead of Christmas indulgences. The SHS Sales & Marketing team will be out in force over the coming months, visiting thousands of depots and retailers to help them understand how to maximise the opportunity in the OTC category, which already delivers over £82 million a year to the wholesale and convenience channel (SHS/Nielsen). “The immediacy of relief that consumers can find from picking up a pack of paracetamol or a cough medicine from their local store is driving significant growth in the key categories such as cold and flu (+5%) and child pain relief (+6%), which is keeping up with, and even outperforming the sales performance in the grocery sector,” reports Andrew Freestone, commercial director at SHS Sales & Marketing. “The wholesale market is crucial in ensuring that retailers can access the breadth of product sub-sectors that customers now expect to find in their local store.”


Stock up now!


[ OTC REMEDIES ] He continues: “As SHS Sales & Marketing has developed the portfolio of leading brands it represents within the sector, the wholesale channel has been instrumental in providing feedback and insight across the total OTC category which has helped to better inform brand activity plans and product innovation. By working in partnership with the wholesale channel, retailers now have greater access to the right range of products and key merchandising advice to help drive sales to the consumer, supporting stronger pullthrough from depots and cash & carries.” According to the company, the highest concentration of OTC sales in the convenience channel are from adult pain relief, which is worth £30 million. Cold and flu and associated products also deliver significant sales with a combined total of £25 million, and sectors such as decongestants have grown by over 12% in the last year (SHS/Nielsen). Allergy relief is a relatively small sector in the channel with sales of £3 million annually; however, as more people suffer from a range of allergies across the year, it is growing by 13%, demonstrating customer need to access immediate relief in the most convenient location.

‘There is some seasonality to OTC fixtures and it is advisable for depots to flex space in their bays accordingly’ Andrew Freestone, commercial director, SHS Sales & Marketing The key brands within each of the core categories that depots are advised by SHS to stock are: a Pain relief – adult: Nurofen, No.1 ibuprofen brand; Panadol, No.1 paracetamol brand; Anadin, No.1 aspirin brand a Pain relief – child: Calpol, No.1 kids’ medicine brand a Cough: Benylin, No.1 cough mixture brand a Cold remedy: Lemsip, No.1 cold & flu brand; Beechams, No.2 cold & flu brand a Decongestant: Sudafed, No.1 decongestant brand a Medicated throat lozenges: Strepsils, No.1 sore throat brand a Allergy relief: Piriteze, No 1 allergy brand; Benadryl Allergy a First aid: Elastoplast; Savlon a Digestion and gastro: Gaviscon, No.1 indigestion brand; Imodium, No.1 anti-diarrhoea brand a Lip and mouth care: Nivea LipCare; Zovirax; Bonjela. The key advice that wholesalers can give to retailers is to make their fixture as visible and easy to shop as possible. “In visiting a convenience store to purchase OTC products, shoppers are not looking for the same sort of healthcare advice they would seek in a pharmacy; they want to review the available options from brands they trust and select the most appropriate product for their symptoms. Therefore, moving the fixture into a visible location on the shopfloor will help 34

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customers select their purchases quickly and easily. By moving the OTC fixture out from behind the counter, retailers have seen sales increases in excess of 40%,” Freestone reports. Freestone adds that, in laying out depot bays, it is advisable for cash & carries to follow a logical flow where products within a subsector are merchandised together with the national brands acting as signposts for the total fixture. “By creating this layout, depots inspire retailers to replicate the fixture in their own stores, creating an easy to navigate fixture where shoppers can quickly find what they’re looking for,” he says. “There is some seasonality to OTC fixtures, with a greater demand for cold & flu and indigestion remedies during the winter and allergy treatments in the spring, and it is advisable for depots to flex space in their bays accordingly to accommodate these changes in demand.” Ceuta Healthcare also points out the importance of increasing stockholding of relevant OTC products prior to Christmas and New Year. For example, convenience stores are often a destination for indigestion remedies, and Rennie is the market leader in indigestion tablets within grocery convenience with a 65% share. The fastest selling SKU, Rennie Peppermint 24s, is now available in a branded drop-feed unit. Studies have shown that placement of this unit next to curry sauces, food to go and other such categories can triple the rate of sale, reports Ceuta. Rennie is being supported by national TV advertising in 2017-18 as part of a £4 million spend. In the upset stomach remedy sector, Alka Seltzer is the market leader and, like Rennie, is available in a drop-feed unit. Demand for lipsalves also increases over the winter months. Lypsyl, which is on TV for the first time in 20 years, is available in a hanging card of 10 sticks. Congestion relief products make up 15% of the cough, cold and flu category. The market leader is Vicks, for which TV investment for the upcoming season (November to February) has been tripled to £3.5 million. Also in the decongestant sector is Olbas, from LanesHealth. New to the market is Olbas Nasal Spray, which works within just two minutes and is clinically proven to unblock nasal passages. It is available in a 20ml bottle, with an rsp of £5.99, and is suitable for adults and children aged six and over. “Many consumers will continue their everyday commitments while fighting a cold, so Olbas Nasal Spray provides an on-themove, quick comfort and easy-to-administer solution for blocked noses,” says brand manager Nikki Banwell. Earache can be treated without the need to see a doctor, says LanesHealth. Earex Pain Relief Ear Spray (rsp £9.99 for 15ml) is the latest addition to the Earex range and an effective all-in-one solution to help calm, soothe and reduce pain.


DON’T GET LEFT OUT IN THE COLD... PUT SOME HEAT INTO YOUR SALES WITH FISHERMAN’S FRIEND

• Sales of Fisherman’s Friend continue to grow • +4.8% value growth in 2016 v 2015 – our best year since 2000* • Rocketing by +14% (value) in impulse and convenience** • Strongest ever Cash & Carry promotions available for Autumn 2017 • Nationwide sampling campaign kicks off in November • £1 million January 2018 national TV advertising burst starring world-renowned tenor, Alfie Boe

GET ON BOARD & STOCK UP NOW WWW.FISHERMANSFRIEND.CO.UK U.K. Distributor – Ceuta Healthcare: 0844 243 6661 *Ceuta Healthcare, in-market total sales **Ceuta Healthcare, in-market sales, Jan-July 2017 v. Jan-July 2016


[ OTC REMEDIES ]

Medicated confectionery Medicated confectionery is widely recognised as a distress purchase and, as such, offers a big opportunity for wholesalers and retailers to capitalise on impulse sales during the autumn and winter cough and cold season, points out Martin Stimson, area business manager for Fisherman’s Friend in the UK. According to Impex Management, that was certainly the case during 2016, as sales of Fisherman’s Friend across all outlets increased by 4.8% compared with 2015, representing the brand’s best performance since 2000. Furthermore, the extended cold and flu season put the brand’s sales in the six months to the end of June this year ahead by 8% compared with the same period in 2016 – and by an even more impressive +14% in wholesale and cash & carry outlets. “Fisherman’s Friend has very high consumer loyalty within the UK, due to the brand’s iconic heritage and the ‘cult-like’ following of the UK’s best-selling flavour, Original Extra Strong, which contains more menthol than competitor brands,” says Stimson. “At the same time, we’ve introduced a raft of fruity variants over the years to appeal to shoppers who want the benefits of menthol but with a more subtle, softer flavour, and these are proving increasingly popular.” Visibility of Fisherman’s Friend will be bolstered this winter with a heavyweight marketing campaign featuring a combination of digital, social media and PR activity. This will include the brand returning to TV screens in the New Year with adverts featuring Alfie Boe – the third time the brand has teamed up with the world-renowned tenor. The £1 million burst of TV activity will run throughout January across ITV and satellite channels. In addition, Fisherman’s Friend will be running a ‘buy two get one free offer’ on retailer packs across key cash & carry accounts throughout the UK. Retailers will be able to purchase two boxes of Original Extra Strong and one box of the popular Aniseed variant for the price of two. All boxes also contain ‘24 packs for the price of 22’. This ‘best ever offer’ for Fisherman’s Friend will end on 30 November. “We feel that this is a great way to support Fisherman’s Friend,” says Stimson, “and it will give retailers an added incentive to make sure they don’t miss out on one of the category’s biggest success stories this autumn and winter.” 36

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Fisherman’s Friend is sold in more than 100 countries worldwide. Within the UK range, the best-selling varieties are Original Extra Strong, Sugar Free Blackcurrant, Aniseed, and Sugar Free Honey and Lemon. Ceuta Healthcare is responsible for the distribution of Fisherman’s Friend in the cash & carry/delivered wholesale channel. With most adults experiencing two to four colds a year, stocking winter remedies during the cold season offers retailers a huge opportunity as category sales increase, says Dan Newell, confections marketing manager at Wrigley. Wrigley’s medicated confectionery portfolio is currently worth £8.4 million and represents 9.9% of the total category (Nielsen). Lockets contains a soothing liquid centre and clearing menthol, whilst its double action formula calms stubborn coughs and colds and eases discomfort. Each pack contains 10 sweets and there are three flavours – Honey & Lemon, Extra Strong and Cranberry & Blueberry. Wrigley has a dedicated range of eye-catching PoS to help retailers make the most of their OTC remedies and encourage customers to buy on impulse. Newell comments: “Over-the-counter medicine is increasingly important for retailers to stock during the colder months as consumers become more reliant on stores that can cater to all of their top-up-shop needs. “Lockets is a trusted brand which helps many people get through the day, easing colds and coughs so families can get on with what’s important. With this is mind, our great range of PoS will support retailers and help boost their sales during the winter season. Having a fully stocked display will help maximise profit potential and guarantee repeat visits from customers.” Jakemans will benefit from a TV advertising campaign from November until midJanuary. This will be supported with out-ofhome, print advertising, digital and PR activity. The brand, from LanesHealth, comprises Throat & Chest and Honey & Lemon variants in 10-sweet stickpacks and Throat & Chest, Honey & Lemon, Cherry, Peppermint, Menthol & Eucalyptus, Blackcurrant, and Blueberry flavours in 100g bags. Jakemans brand manager Elizabeth Hughes-Gapper points out: “The local convenience store is often the first port of call when you experience the early signs of a cold, commonly characterised by a scratchy, irritated sore throat. Being close to home, convenience stores are perfectly placed to capitalise on consumers looking for remedies to relieve their CCM early symptoms.”

For further information: Ceuta Healthcare (0844) 2436661 GlaxoSmithKline 020-8047 5000 LanesHealth (01452) 524012 SHS Sales & Marketing (01452) 378500 The Wrigley Co Ltd (01189) 317030


DISPLAY HOTLINE 01788 545 573 | WWW.WRIGLEY.COM/UK


[ CONFECTIONERY ]

Sharing profits in confectionery

Holding steady with a value of more than £5.5 billion (Nielsen), confectionery continues to be a reliable category led by impulse, driving incremental sales. By responding to heavyweight investment by suppliers, wholesalers can create excitement in the category.

C

hocolate has seen plenty of innovation from the major suppliers, proving that there are still opportunities in the category. Sharing remains a growth driver, and manufacturers continue to cater to the Big Night In mission with their NPD and format extensions. Mondelez International’s launches this year include tablets and sharing bags. “This year we brought even more of our hero brands to the bitesize category with Cadbury Fudge Minis, Cadbury Curly Wurly Squirlies and Cadbury Picnic Bites. All three brands are consumer favourites to recruit pre-family and younger families to drive penetration for the category,” explains trade communications manager Susan Nash. The Fudge Minis were launched early in the year, and have now been joined by Cadbury Curly Wurly Squirlies and Cadbury Picnic Bites 110g bags, rsp £1.99, while in the tablets sector, Cadbury Dairy Milk Tiffin has been reintroduced as a permanent addition. Marketing activity has also been a priority for the supplier, whose Cadbury brand has featured familyfriendly consumer campaigns such as the £4 million Cadbury Dairy Milk ‘Adopt a Cow’ and the Cadbury/ Merlin Entertainments ‘Free the Joy’ on-pack promotions. “Make the most of brand investment – have displays in-store when consumers will be most aware of products due to advertising or other media investment,” advises Nash. Storck UK is also investing in media activity with a £4.5 million TV campaign supporting the UK launch of its Knoppers brand, which has already seen success in 50 countries. Positioned as a lighter treat in the chocolate category, the product has 137 calories. “With Knoppers presenting a 61% incremental sales opportunity, we believe that the brand is set to continue this success in the UK,” says sales director Andy Mutton. The new product comes in singles (rsp 50p) and multipacks of four (rsp £1.25) and is being backed with display materials and sampling. Mars Chocolate NPD has catered for the indulgent treat with its on-trend Mars Chocolate Brownie, which is available in a standard and a price-marked single and multipack to benefit the convenience channel. “With so many priceconscious shoppers today, price-marked packs reassure them that they are getting the best value for money,” points out trade communications manager Bep Dhaliwal. 38

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Mars Chocolate has also achieved growth from its £1 PMPs, which include treat bags and block lines. While treat bags and pouches have seen Mars’ sales rise by 0.3% to a 41% share of the category, leading block brand Galaxy has generated sales of £218 million in a category that has grown by 2% (Nielsen). Ferrero’s activity has incorporated kids’ confectionery, with the introduction of limited-edition Kinder Surprise eggs featuring Hello Kitty and Hot Wheels toys, licensed under Sanrio and Mattel. The Kinder Surprise brand is worth £62 million, and Ferrero is supporting the launch with a £1.5 million media campaign including TV, digital and in-store activation forecast to reach more than 12.5 million people. The eggs have an rsp of 92p and PoS materials are available from the supplier’s trade website.

‘With adults making up two-thirds of Kinder Bueno consumption, we wanted to develop a campaign that would connect with them’ Levi Boorer, Ferrero’s customer development director Ferrero is also targeting adult consumers with its Kinder Bueno ‘Now That’s Adulting’ marketing campaign, aimed at 25-34 year old women. “With adults making up two-thirds of Kinder Bueno consumption, we wanted to develop a tonguein-cheek campaign that would connect with them and their daily lives,” explains customer development director Levi Boorer. The activity incorporates vlogger partnerships, social media, video on demand, experiential sampling and shopper media, along with free PoS materials.


STOCK UP NOW FOR CHRISTMAS

ON TV IN NOVEMBER


[ CONFECTIONERY ] Sugar confectionery With the UK candy market valued at nearly £1.3 billion, chocolate isn’t the only confectionery receiving investment from suppliers. Mondelez International has also focused on the sugar sharing category with the recent launch of a tropical variant of Maynards Bassetts Jelly Babies. “Previous line extensions from the brand, such as Berry Mix, have been highly incremental to the category (Kantar), and tropical is a top trending flavour for 2017 (Nielsen),” says trade communications manager Susan Nash. The 165g bags have an rsp of £1.32 and the launch is supported by a £6 million media spend during the year including TV, PR and digital activity, plus PoS materials. Wrigley recently added limited-edition Starburst Strawberry packs to its £18.5 million Starburst brand. These are available in 45g bags, 150g hanging bags and 165g sharing pouches. “Launching through route to market for independent and symbol retailers in single and hanging bag format, these rotational limited-edition listings are a great opportunity for retailers,” maintains confections marketing manager Dan Newell. Ferrero’s Tic Tac Mixers brand have also gone tropical with a Coconut to Pineapple flavour, replacing the Peach to Lemonade variant. Tic Tac Mixers is now worth £3.9 million, with growth of 7.5% (Nielsen), and the new flavour launch is supported with a digital campaign. “The flavour-changing experience of Tic Tac Mixers has driven 34% incremental category growth over the last year,” says customer development director Levi Boorer. Nichols, which owns the Vimto brand, has teamed up with Golden Casket Group to introduce Vimto Millions. The sweets target teenage consumers, tapping into Vimto’s popularity in this age range, and are available in 40g countlines (rsp 50p) and 85g £1 price-marked bags, as well as 227g and 2.27kg jar formats

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(rsps £2.95 and 80p per 100g respectively). Marketing support includes a digital campaign and social media activity. Family toffee maker Walker’s Nonsuch plans to add two new toffees to its range in 2018, making a total of 14 varieties available in 2.5kg bulk bags and 10 in the 150g bag range. Export sales director Emma Walker comments: “The strong and robust varieties like Treacle and Liquorice are proving to be real favourites at the moment, along with the traditional English Creamy Toffee. We are also looking at extending our shelfready packaging, which helps retailers and makes the products stand out on shelf to create an impulse purchase.” Walker’s Nonsuch exports to more than 45 countries worldwide. Perfetti Van Melle has met the growing trend for portion packs and responsible consumption with its limited-edition party packs such as The Fab Mix, targeting opportunities over the festive period. The 45-piece CCM and 56-piece pouches have an rsp of £3.

For further information: Ferrero 020-8869 4000 Golden Casket Group (01475) 721099 Mars Chocolate (01753) 550055 Mondelez International (08702) 400861 Nichols (01925) 222222 Perfetti Van Melle (01753) 442100 Storck UK (01256) 340300 The Wrigley Co (01189) 317030 Walker’s Nonsuch (01782) 321525


[ SUPPLIER STRATEGY ]

Are your soft drink sales healthy? Chris Sanders (pictured), sales director at Radnor Hills, urges wholesalers to tap into the sales potential of school and hospital-compliant soft drinks. What proportion of your business goes through the cash & carry/ delivered wholesale trade? Around 50% of our business is now cash & carry and delivered wholesale trade. Up until about five years ago it was around 25%, so it has seen significant growth, as has our overall company turnover. How are you looking to develop your business through the wholesale trade? Which customer sectors are you specifically targeting? (For example, retail, foodservice, education, hospitals, licensed.) We are looking to expand and develop in all of the above sectors. In the retail sector we have a really strong children’s lunchbox offering as well as our premium adult soft drinks range, Heartsease Farm. We are market leaders in schoolcompliant drinks for the education and foodservice sector, having recently launched our Tetra Pak range, offering a drink suitable for primary and secondary schools in 125ml, 200ml and 250ml cartons. We have also developed a wide range of CQUIN (NHS) compliant soft drinks suitable for hospitals. Our portfolio of products also includes a selection of on-trade specific drinks that offer premium quality. Our Heartsease Farm range is included in this, and in January we will be relaunching the drinks with a new label design and reduced sugar content – making them even more appealing to the licensed sector. Have cash & carries tapped into the specific requirements of educational establishments and hospitals with regard to healthier soft drinks? How does this compare with foodservice delivered wholesalers that are used to these specific customer needs? We have found that cash & carries have taken a little longer to catch on to the need for healthier soft drinks in hospitals and especially school-compliant

research and in schools delivering taste tastes. We have even developed a specifically designed taste test app for our drinks so we can keep up with market trends and develop new products based on our findings. We try to be as creative as possible but often new listings can get blocked. We would encourage all wholesalers to be creative with their soft drinks ranges and not just stick to core brands and flavours.

products. One reason for this is that cash & carries have always historically stocked the classic carbonate brands and have not always branched out into the new and exciting options that are available to them. Booker is the latest cash & carry that has listed our schoolcompliant ranges in its depots and they are selling extremely well. How can cash & carries improve their sales of ‘healthier’ soft drinks? Point-of-sale material in cash & carries can be an important way of delivering strong messages. Not everybody knows what a school-compliant product is, how much sugar it contains, and what the minimum and maximum sizes are. When making school-compliant drinks there is an extra set of rules we must adhere to. With the right advertising it will make it a lot clearer for the customers to know what they are buying. Similarly, what more can delivered wholesalers do to increase their sales of these drinks? The biggest obstacle we find is wholesalers not necessarily jumping on board with new flavours. As a company we spend a lot of time doing market

Are there any cash & carries or delivered wholesalers you wish to highlight as being particularly progressive? Dunsters Farm (a foodservice wholesaler based in Bury) recently visited our site here in Powys. They brought their entire sales team to our factory and they had a tour, learnt about the heritage of our company and really got a feel for what we do. We have worked with Dunsters for around nine years now and have built a great relationship with them. We would encourage any other wholesalers that work with us to come and see what we do and how we get their delivery to their door. How will the forthcoming tax on sugary soft drinks affect your business? We have adapted very quickly. We had two of our premium ranges that contained sugar, as this was the best option for us to get the great taste that we wanted. However, we have worked a lot now with stevia, and we will be looking to reduce the sugar in all of our products and keep them below the 5% mark. Is there anything else our readers should know about Radnor Hills’ operation or strategy? Over the last six years we have really expanded our sales team as our sales and customer base have grown. For us it is all about building strong relationships and working closely with our customers to deliver the right product, at the right price, at the right time. CCM

www.cashandcarrymanagement.co.uk

October 2017

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[ PRODUCTS & PROMOTIONS ]

Responsible cleaning takes a step forward PRODUCT OF THE MONTH

Unpriced pack Boost Drinks has introduced a plain pack format for its Protein Boost milk drink, exclusively supplied to the independent channel. “Having seen a huge demand for our price-marked protein products, we felt now was the time to offer our customers a plain pack version to give them more flexibility,” explains Boost Drinks sales director Al Gunn. The new 310ml bottles come in strawberry and chocolate variants, in cases of eight, and can be stored on-shelf as well as in the chiller. Supporting marketing includes PoS materials, outdoor advertising, PR and a social media consumer campaign #MyNextSteps, where consumers have the chance to be recruited to participate in a 12-week programme to improve their health and fitness. Boost Drinks (0113) 240 3666

Delphis Eco has introduced the first 100% post-consumer recycled (PCR) plastic packaging, created after five years of research. With environmental concerns a major focus for suppliers, this breakthrough signals a possibility for change. “Waste plastic is a huge issue. We hope that international corporates will sit up and take note by embracing the responsibility to invest and drive a

paradigm shift on how we recycle plastic and use PCR waste,” says Mark Jankovich, CEO of Delphis Eco. “By driving this change to our packaging, we have taken 500 tonnes of carbon emissions out of the equation.” There are more than 35 products available in five-litre formats that cover washroom, personal hygiene, general, kitchen and specialist areas, including anti-bacterial sanitisers, descalers and combi-oven cleaners. Delphis Eco (0203) 397 0096

Thin fins

Winter dressing

Popcorn delights

Burton’s Biscuit Company has introduced sharing NPD from its Fish ‘n’ Chips brand. The new Crisp ‘n’ Fin are thinner versions of the fish and chips shapes, using a lighter recipe. There are Salt & Vinegar and Sour Cream & Chive variants, both 150g bags in cases of eight with an rsp of £1.59. Alongside the launch is a packaging refresh for the Fish ‘n’ Chips brand, which will carry a new logo. The activity is supported by a £100,000 campaign that includes in-store activation, PoS materials, and sampling and social media activity. Burton’s Biscuit Co (01727) 899700

Flagship Europe has extended its range by introducing a new dressing suitable for the winter months. The Lemon, Black Pepper & Chilli Dressing combines a citrus twist with a touch of fiery heat. The new foodservice product comes in cases of 10 x 500ml and can be used for dipping or drizzling, as well as for dressing salads. Flagship Europe offers a wide product portfolio to the foodservice market, including meat and poultry, savoury pastries, sauces, dressings, mayonnaise, seasonings and mini desserts.

PepsiCo’s Pop Works & Company has unveiled two new ranges catering for the sweet treat and pure indulgence occasions in the popcorn market. In the last year, 25% of the growth in popcorn came from NPD, with Pop Works & Company contributing almost half of this. The new Glazed & Glory range includes Strawberry Cheesecake, Sticky Toffee Pudding and Toffee Apple variants (rsp £1.70). Alongside this range, the Drizzled Delights line-up includes Milk Chocolate & Caramel, Dark & Milk Chocolate and Dark Chocolate & Orange variants, all with an rsp of £2.

Flagship Europe (01252) 846500

PepsiCo (0118) 9306666

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[ PRODUCTS & PROMOTIONS ]

Holiday activity

Retro selection

Nuts for snacks

Hamlyns of Scotland has partnered with Forest Holidays to offer consumers the chance to win a three-night weekend or four-night midweek break for four people at the Ardgartan Argyll and Strathyre locations. In addition, the Hamlyns website is featuring a special discount at Forest Holidays for the duration of the promotion, which runs through the winter. “Forest Holidays is a great fit for the Hamlyns brand, and we’re confident that the competition will be really well received by our customers,” says Alan Meikle, managing director at Hamlyns of Scotland. Hamlyns of Scotland (01343) 541496

Mondelez International has introduced a new addition with a nod to the past in its range of festive selection boxes this year. For those consumers who enjoy a touch of nostalgia, the Cadbury Dairy Milk Classic Collection from Mondelez will bring back memories. The festive-release selection box contains Dairy Milk, Whole Nut, Caramel and Fruit & Nut bars in the iconic classic packaging, complete with tinfoil wrapping. Catering to gifting opportunities and part of the NPD that Mondelez has brought into its seasonal range, the 460g retro selection box has an rsp of £5.95. Mondelez International (08702) 400861

Whitworths has produced a new nut range specifically aimed at children from five years old, offering a low sugar and salt snack that is a natural protein source. Bright Little Nuts is available in three varieties – mini cashews, mini hazelnuts and almond halves – in 5 x 20g multipacks (rsp £2.59). The packs include collectable ‘My Amazing Body’ cards with quizzes, facts and games for children and there is an interactive website designed to further engage consumers. The launch is supported by a campaign incorporating sampling, video and social media activity. Whitworths (01933) 653000

Premium pets

‘Free-from’ fish

Skittle bottle

Nestlé Purina brand Gourmet has undergone a packaging redesign to enhance its premium credentials. The pioneer of the cat soup category, and winner of Product of the Year in the wet cat food category, has achieved a 15% market share (IRI) of the cat food market. Recognising the significance of 11.4% growth in the luxury pet food sector, new packaging aims to increase premiumisation on key brand elements with a new brand logo, food visuals and text positioning. The redesign is supported by cinema advertising running until December. Nestlé Purina (01787) 886000

Vestey Foods is now handling sales of Scandia Foods’ free-from brand Ockery. Its range of sustainably sourced fishcakes is catering to current dietary trends, being free from gluten, wheat, dairy, nuts and soya. The fishcakes are available in 2 x 90g, 4 x 60g and 6 x 30g sizes in Cod, Salmon, Smoked Haddock and Crab varieties. Michael Hansen, seafood category manager at Vestey Foods, says: “Ockery is all about simple, greattasting food that can be enjoyed by everyone, not just those people following free-from diets.”

CCEP has invested £6.6 million in an integrated marketing campaign for mixer brand Schweppes. A new, skittle-shaped bottle pays homage to the brand’s original design and a campaign featuring out-of-home, TV and cinema advertising, experiential marketing and digital activity accompanies the redesign. “The last quarter of 2017 is going to be massive for the Schweppes brand,” predicts customer marketing director GB Simon Harrison. “We’re confident the new campaign will drive sales and category growth for our customers.” CCEP (01733) 828000

Vestey Foods Scandia (01666) 577984

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