Phil Mellows examines the development of the wholesaling industry and how local firms are taking on the big national companies
Whether it is drinks, food or other goods, wholesale delivery to pubs is polarising into two kinds: the big national operation and the small local firm.
Both, of course, are also in varying degrees of competition with do-it-yourself, where licensees themselves take a trip to the cash and carry or even the supermarket.
In many ways, cash and carry purchases are a different market. Publicans trade their convenience for the levels of service they should expect from a wholesaler who not only delivers to the door, but might also be able to offer advice and other support. Although the big cash and carries such as Booker are also beginning to offer services of this sort.
What the trade demands from the wholesaler varies, depending on whether the pub is part of a managed chain or run by an independent licensee - a freetrader, lessee or tenant.
The latter will usually be responsible for organising their own supplies of products that fall outside any tie and because of their very independence represent a challenge for the wholesaler.
With the trend moving away from managed back towards leased and tenanted estates they are also growing in numbers. Thousands of pubs which only a year or so ago relied on centralised purchasing and distribution now require a service tailored to their own needs.
Non-food wholesaler King, for example, has recognised this by setting up new Express depots.
This development is paralleled to some extent in the freetrade. While the overall trend has been towards consolidation and the growth of national wholesalers such as Bulmers-owned Beer Seller, local beer wholesalers are once again springing up to offer the trade what they claim is a more flexible service.
The Brighton Beer Company, for instance, was launched earlier this year by Darren Read, who was business development manager at Tavern Wholesale, the national network which was broken up and sold in February.
With the help of ex-Beacon Drinks sales manager Paul Heward he has quickly built up a customer base of more than 300 accounts, all within a 20-mile radius of Brighton, and is enjoying his battle with "the big boys".
"Our low overheads mean we can beat them on price, and having a local focus means we can offer a same-day service, seven days a week, something they can't match," he said.
He has already expanded the Brighton depot and plans to open a second in Chichester, West Sussex.
He also wants to add wines and dispense gases to his portfolio.
"I believe everything goes round in a circle and we have gone back to the way the wholesale industry was when I joined it, 17 years ago.
"Customers want to have their local wholesaler back. They want a better service and they want to deal with human beings, not machines."
A similar philosophy is pursued by the 29 members of National Drinks Distributors, but as well as providing local service, they have some of the benefits of a national organisation.
In his new, bigger office in Aston-on-Trent in Derbyshire, chief executive Steve Graham carries out central purchasing, produces a brochure for customers six times a year and is working on some ambitious brand-building initiatives.
He is currently in talks with Oxfordshire brewer Brakspear to develop its cask ale into a national brand by making it readily available to each of the 29 wholesalers, which between them now have almost total coverage countrywide.
Most of them are also lined up to take part in a wine-buying group, and Steve is in negotiations with a French brewer to bring over a tequila-based drink which he believes will open up a new sector for PPL/PPS cross-over brands.
"Our members are proud of their independence and their ability to offer good old-fashioned service, but having an umbrella organisation gives them an extra advantage.
"Now that we have national coverage we also have an appeal for companies who need a route to market for their brands."
The plethora of small wholesalers are a local aggravation for the national networks trying to tie up distribution, but groups such as The Beer Seller continue to improve their operation.
The Beer Seller, which was purchased by Bulmers a couple of years ago, chiefly to give the cider maker a route to market for its brands, now has 19 depots employing 600 people.
It recently opened a new depot in Warrington to cover the North West and has reshuffled its South East network after picking up five depots from Tavern.
Where the national companies probably have the greatest advantage over the locals, however, is in wine wholesaling.
The two giants, Matthew Clark and Scottish & Newcastle's Waverley, have increasingly focused on wine in recent years as the UK market has grown.
They have taken responsibility for making sense of a confusing and fragmented marketplace for licensees who are having to battle against a poor image of pub wine, and they are making progress by working closely with the trade on wine selection, marketing and merchandising.
Waverley's research into wine consumption, in particular, is helping pubs to target their offering and make the most of the opportunity.
As well as wines, Matthew Clark Wholesale has made a point of developing the new, fast-growing FABs (flavoured alcoholic beverages) market and reckons that it supplies about one in four FABs consumed in the on-trade.
Its separate brands division recently clinched a deal with high street fashion house French Connection to launch an FCUK-branded FAB which will no doubt take up a central place in the Matthew Clark Wholesale portfolio.
More on our focus on wholesaling:
A look at non-food wholesaler King, formerly Autobar
With quality pub food on the rise, wholesaler 3663 is helping to lead the way
Brake Bros takes on the takeaways with the launch of a range of Indian dishes