SAN DIEGO – Even with all the changes the grocery industry deals with, when it comes to working with grocery wholesalers one challenge remains for independent retailers: retaining their niche.
“We have to find that sweet spot where a retailer can still be unique but then still benefit from the economy of scale,” said David Smith, president and CEO of Associated Wholesale Grocers, in a supersession, Feb. 25 at the National Grocers Association’s annual convention.
Randy Arceneaux, president and CEO of Affiliated Foods, agreed, saying “Wholesalers have to be the bridge between independent retailers and suppliers.”
Four wholesalers spoke of their roles in helping independent retailers succeed, and two common themes emerged: Fresh food should be a differentiator and independents should be heavily involved in their communities.
“Meat and produce differentiates us,” Arceneaux said. “You have to dance with who brung ya.”
John Ross, president and CEO of IGA Inc., said despite all the challenges and competition, independent retailers are in a strong financial position.
He said the population continues to grow, and consumers are more passionate about food than ever, even if they’re not as knowledgeable as they think they are.
With many emerging competitors challenging independent retailers on price, grocery wholesalers can help keep them in a position to lower prices for consumers.
“We have a relentless drive to cut costs out of our system, to take every line item and look closely,” said Mike Stigers, executive vice president, wholesale, for UNFI/Supervalu.
Smith said NGA members have an advantage over larger competitors when it comes to making quick changes and investing in technology.
“Public companies look at technology different than independents,” he said, in that independent retailers don’t’ have to show immediate success but can afford to try different things until they get the right technology that will work long term.
Arceneaux said independents are in a solid position.
“We’re in touch with our customers,” he said. “The independent operator will always come out of top as a grass-roots entrepreneur.”
