Wholesale grocery business has seen many fluctuations in the market but is still going strong. Industry experts and analysts study the markets and release new trends based on the current scenarios that govern the wholesale grocery business and the convenience stores. The wholesale grocery business has changed a lot for sure. But is it here to stay? What about independent stores? Will they survive?
There is no doubt that the wholesale grocery business is one of the most competitive businesses. But this is also true that this business has been around for centuries and still existing. The wholesale grocery business has continuously reinvented itself given the opportunities in the market as well as the changing trends in the market.
Gone are the days of goods arriving through ships and merchants haggling at the ports and the goods then being transported through carts. The merchant trade began this way – goods reaching one continent to another – creating a unique marketplace. But the 20th century changed all of this.
The changes in the wholesale grocery business that happened during and after the World War II established many grocers and establish big business conglomerates. The innovations that happened during those years helped to streamline the wholesale grocery business in a big way. New ways to cut costs, new types of warehouses, new product categories, creating the capacity to sell these new products and reaching out to convenience stores in new ways.
The changing face of the wholesale trade also affected the establishment of convenience stores. From independent stores in the neighborhood corners to high-end retail stores – all this happened as the wholesale grocery business changed over the years.
The present scenario
The wholesale grocery business saw a new trend in the late 20th century — the rise of the mass merchants. This affected the wholesale grocery business in a big way. Were the profit margins of the wholesale distributors affected as a result? Yes. Was the wholesale grocery business this changed forever? Yes again.
Distributors playing the role of wholesalers and reaching out to retail stores trough their own network of distribution was another huge change that the business of wholesale grocery has seen. Big establishments with their big budgets could establish their own distribution channels, which otherwise takes time and patience and of course money.
Big merchants can work out larger discounts and pass the same to the consumers. This is what their business model is based on – huge variety of products along with even bigger discounts to the end-users. Aisle upon aisles of products in every category coupled with huge discounts no doubt attracts customers but has this consumed the business of wholesale grocers and independent convenience stores. The answer is simple – no.
The 21st century is the age of the Internet. With the new technological advances made into this field emerged the online retail stores. Some big players emerged and countless small businesses opened and either shut shop or thrived – just as it happens for brick and mortar stores. But then who serves these online retail stores? Similar to large businesses that handle their own distribution and source their products from various places, these big retail stores also run on a similar model. But then there are countless medium to large establishments that rely on wholesale grocers to supply them the goods.
What the future for the wholesale grocery business holds and how it affects the independent retail stores?
With all the changes the wholesale grocery business has witnessed, one thing is sure – the business is here to stay. This business has survived the threats from big merchants and distributors. But with the changes in the wholesale business also came the transformations in the retail industry.
From small convenience stores serving the need of the entire neighborhood to high-end stores storing just about everything – the retail business has also grown by leaps and bounds. The convenience stores and big retail stores, both the models still need distributors to supply them with the products they sell. There is a need in the market for distributors catering to all sizes of businesses. Not only all sizes but all types of retail businesses.
The online retail stores also need distributors to purchase their stock. Be it food or groceries of all kinds – it is the wholesale grocers and their businesses that serve this market.
The wholesale grocery business is never going to cease to exist. The need of the hour is constant innovation. This business has survived threats from big traders and merchants. The wholesale grocers have faced the challenges from changes in the distribution business. But the truth is that this business is so big that all types and sizes of wholesale grocers can thrive in the competition provided they are willing to innovate to suit the changing need of the market.
A wholesale grocer who refuses to launch a website or doesn’t try to reach out to online retailers might miss out on big online business. If the wholesale grocery businesses during the war or in the 1990s didn’t transform their businesses or didn’t take advantage of the opportunities offered to them then they might have not become as big they could.
It is all about surviving the changing marketplace and embracing new technologies for innovations in the business. And this is also about relationships between wholesale grocers and the retail stores. This business relationship is an important factor that determines how the two fare and survive in a challenging market situation.
Constant changes that have happened with the independent store businesses have helped wholesale grocers a great deal. The more the independent stores thrive in this day and age of competitive and dynamic marketplace, the better it is for the wholesale grocery business.
Independent stores may be smaller in sizes but they also have low overheads. They have long-established relationships with their grocers and with timely innovations on the part of both grocers and the retailers; the future of this business is bright. The wholesale grocers as well as convenience stores are here to stay.