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Growth subdues for wholesalers on pandemic polarisation

The wholesale market has seen growth slowing in 2020 with a new report pegging the growth rate at 2.8 per cent, down from 4.4 per cent in the previous year.

According to the new UK Wholesale Market Report by Lumina Intelligence, double digit turnover growth for wholesalers serving the retail market has not offset huge declines in turnover for foodservice wholesalers.


“Retail wholesalers have seen unprecedented demand surges, which, as well as causing supply chain pressures, has resulted in strong growth across the year. For hospitality, the picture is a lot bleaker, with the ever-changing restrictions imposed since the start of the pandemic having a catastrophic impact on the industry, resulting in around a third of turnover being wiped out,” commented Blonnie Walsh, head of insight at Lumina Intelligence.

The report added that this polarisation caused by the COVID-19 pandemic has resulted in several major shifts in the industry.

These included increased reliance on wholesale delivery as consumers increasingly turned to convenience channel and foodservice wholesalers going direct to consumer to offset losses from hospitality closures.

The year has also seen hybrid wholesalers, the likes of Co-op and Morrisons, growing share of the wholesale sector, from 6.5 per cent in 2018 to 9.2 per cent in 2020. These grocery multiples aim to tap into the growth of the convenience channel, adopting wholesale as a new route to market.

“As we enter 2021, the measures the government intend to impose until a vaccine has been widely distributed remain unclear. The UK wholesale industry needs clarity to ensure it is as prepared as it can be to support grocery retailers and hospitality operators, rather than continuing to second guess what will happen next,” Walsh added.

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