< Back to news 19 April, 2017

Food and Drink Pricing Driven By Ever Changing Political Climate

Historically, food and drink pricing has always been driven by supply and demand and the cost of living. However, now more than ever, it has become driven by the ever-changing political climate, which presents a variety of challenges and opportunities for operators. Beacon's Alice Bexon explores...

With these structural changes to inflation, it has never been more important for operators to pay close attention to their purchasing and supply chain strategy. Above all, the first step in selecting a wholesaler should be to consider exactly what is needed and to understand what the key drivers are for your company – weather it is price and product selection driven, or led by customers service and support, delivery days and time windows or a variety of value added initiatives offered by a supplier.   

Shopping around: Should caterers go with a single wholesaler or cherry pick the best deals

I would highly recommend that operators concentrate on building a strong, long-term relationship with a single wholesaler, negotiating on price as hard as possible – bringing on a third party to support would be a key piece of advice. Working in this way means that operators can establish a relationship with their chosen wholesale partner, which will ultimately lead to an improved mutual understanding, giving the supplier a vested interest in your long term objectives and vision. Locking in long-term deals will give the wholesaler more leverage to better negotiate with their suppliers, with the ultimate aim of passing on cost savings to you, the customer. This is something that has enabled us to better service our customers in what has been a particularly challenging environment for the foodservice industry recently. What’s more, with longer term agreements comes the opportunity for operators to consolidate spend and capitalise on tiered growth rebate structures, which many wholesalers offer.

Overall, a strong relationship with a single wholesaler makes for a more consistent and robust supply chain, rather than “market stall” type trading, which often has few benefits but more cost and time implications. 

Veg Strip

Business support and market insight: Beyond price and range, how else can wholesalers add value for caterers?

Beyond price and range, wholesalers are able to offer substitutions to caterers for products that may be fluctuating in price, which is something we’ve seen a lot of over the past six to eight months. This is a much more efficient process when there is an existing relationship in place.

We are also seeing an increasing number of national food wholesalers, such as our leading suppliers Brakes and Bidvest, investing significantly into development kitchens. Customers can come into the kitchen and spend time with the Development Chefs to get inspiration on new menu ideas, using produce that is readily available to them. This not only allows wholesalers to showcase how its products can be used, acting as a sales tool for them, but simultaneously offers clients an added service as they can gather new ideas and expertise around strengthening gross profit.


NPD: Which areas are wholesalers focusing in in terms of product development? Comment/case studies:  Examples of operators working successfully with  wholesalers.

In terms of product development, we are seeing a shift towards ready meals, however not in the traditional sense. There is an increase in part-ready meals on offer in the market, for example pre-filled pasta that can then be covered with a fresh sauce and a greater concentration on sous-vide type proteins This is something that will become even more relevant when calorie-labelling legislation comes into force, as it helps to minimise the risk of displaying the incorrect calorie information, which will be particularly helpful for smaller businesses that may struggle with any penalties that could be in place.

To find out more about Beacon and how our expert team of buyers can help your busienss to run more profitably, call us on 01904 695588.

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