For suppliers, Tesco creates a cheap route to market and in return for accessing it the supplier gives up his control over his brand. The independent channel, in contrast, is hard work and more expensive but he retains control. The integrated wholesale/retail model of the large supermarkets has been winning for 40 years. But if social networks are allowing consumers (shoppers) to undermine the rise of the big brand, how could this be exploited by smaller nimble businesses? An opportunity for the wholesaler in the new century.
“Twenty years ago I was driving boxes to the post office in my Chevy Blazer and dreaming of a forklift,” says Jeff Bezos in his most recent letter to shareholders. A blink later and he points out that the company has grown from 30,000 employees in 2010 to 230,000 now. But his ambition is the same. “We want to be a large company that’s also an invention machine. We want to combine the extraordinary customer-serving capabilities that are enabled by size with the speed of movement, nimbleness and risk-acceptance mentality that is normally associated with entrepreneurial start-ups.” Amazon is great at disruption because of its customers focus and the fact that the internet means it needs none (or very few) people between its warehouses and the shopper. The threat of Prime, its membership service, is the biggest challenge facing the UK retail market and the wholesale market by extension. It is both a direct threat and an indirect threat in that is inspiring countless numbers of othe...
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