VOW Wholesale: Meeting challenges head on

Dealer Support caught up with ADRIAN BUTLER MD at VOW Wholesale to see how the last few tumultuous months have been for them, and what the future might entail for the OP industry

How we looked at the beginning of the year was completely shaped by what we did in the latter part of 2019. Our focus was on sales growth and we put ourselves in the best position to achieve this through offering over and above growth incentive schemes for dealers. In addition, we saw a number of dealers winning large end-user contract business, utilising our WRAPIDE direct delivery service. This really resonated with our overall strategy of being the ‘warehouse and wheels’ for dealers, enabling them to take costs out of their businesses through relying on VOW for stockholding and despatch to their own customers. Through Q1 2020, VOW was in a position of growth and things were looking positive.

Then lockdown happened and we saw an overall volume drop of 42% pretty much overnight. We had to react quickly, as all businesses did. What followed was a review of all areas in the business and a scaling back to business-critical activities, including use of the government furlough scheme where appropriate.

Sales are now starting to recover and we saw a 30% increase YOY in June. It is worth stating that even preCOVID, 50% of what VOW sold was in non-traditional categories. Traditional OP is still very important for us, but we have not been a ‘stationery’ wholesaler for some time. The current environment is only accelerating the mix change.

I believe the way people work and the products that they need has changed, so moving forward the product range our customers can offer is going to be key. Resellers need to help their end-users feel confident about going back to the office as well as providing effective solutions and products for home working. The VOW products teams have put a lot of work into these areas in recent months and we have quickly brought to market new product ranges to support both focus areas.

From an operational perspective, we continue to listen to the feedback of our dealers and we are reacting to support changing customer dynamics. This includes building resources in our ADC warehouse to support an increased number of smaller orders for direct delivery being sent.

PPE, infection control and home working have become key product categories and we believe these ranges are here to stay. VOW having the flexibility to meet reseller and consumer demands quickly is key for us moving forward.

Within the space of a week we enabled around 500 people to work from home to ensure we could maintain our customer service and support functions. It was a fantastic effort by both our IT team to achieve that and by my colleagues within VOW to embrace a different way of working.

One of the key things that we did early on in April was a review of the products we were bringing in. Demand for traditional office supplies dropped, while demand for cleaning and hygiene products increased. What really helped us here was the flexibility within VOW and – as a wholesaler – our multi-category approach and supplier relationships.

We also changed the focus of our service proposition to meet the changing demands of our customers. Almost overnight we saw a significant increase in the number of dealers utilising our WRAPIDE service to deliver direct to their end-users. We in effect became their ‘warehouse and wheels’, enabling dealers to take costs out of their own business so they could continue to trade. We truly believe that the way people work will change moving forward and have adapted our own product offering and services in-line with this.

I’m definitely not going to gloss over the fact that the past four months have been incredibly challenging, but we’ve generally managed to meet these challenges head-on. The immediate drop in volume was the biggest of these issues and did require us to make some difficult decisions regarding the running of the business day-to-day at very short notice.

Not so much a lesson, but I think one of my key takeaways from the past four months has been the incredible capacity that people have to cope with change and to rally together when facing adversity. VOW is nothing without its people and all colleagues at every level within the business have worked incredibly hard to maintain our service offering throughout this period.

We’ve obviously had a number of conversations with dealers following the demise of Spicers. Some are new customers to VOW, but the majority are customers we have dealt with in the past or who historically split their business between both Spicers and ourselves. As you’d expect, we saw an increase in volumes immediately following the Spicers announcement, but we have taken a sensible approach to this and at all times have considered our ability to continue to service our own long-standing supporters.

I think there was a nervousness within the industry regarding the UK only having one broadline wholesaler left, but I do not see that as being the case. Spicers was not our sole competitor and has not been for a number of years. There are many competitors in the market that we are up against. These include regional players, operators in specific categories like FS and EOS and other distributors with slightly different models. We do not have a monopoly or guarantee of business, nor are we complacent in terms of picking up that legacy Spicers business.

With all of that being said, what has become very clear to me is that VOW has a huge responsibility to the industry. Many businesses and people’s livelihoods depend on us doing what we do and doing it well. We are very conscious of that and so doing the right thing informs all of our thinking.

Buy plenty of face masks and hand sanitiser in January! And toilet roll for that matter!

In all seriousness, I would want to reassure myself that regardless of what is ahead, VOW is a good business with excellent people and that we’re well equipped for what is to come.