Foodservice drives sales growth for wholesalers

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Sales at UK grocery wholesalers grew 0.3% to almost £30bn in 2016, driven by increases in the foodservice market.

According to IGD, the development of more clients in the foodservice market, which saw sales grow 2.1% in 2016, led to another year of sales growth for wholesalers.

IGD also forecast that the wholesale sector would continue to expand for the next four years, reaching £31.3bn by 2021.

James Walton chief economist at IGD said: “For another year, foodservice has lifted the wholesaling sector, representing the vibrancy of the expanding out-of-home customer. We’re also seeing growth in the chilled and fresh and beer, wines and spirits categories, demonstrating clear investment opportunities for wholesalers.

“One area of decline for the channel was tobacco (by -1.8%), but this is to be expected as new legislation brings in plain packaging and minimum pack sizes. Sales to the independent and convenience retail customer base also fell (by -0.6%).

”However, IGD’s recent survey indicates that four out of five (80%) wholesale suppliers remain optimistic about the future of the wholesale channel, including independent operators. Therefore, there is still plenty of opportunity for wholesalers wanting to drive growth in the independent market.”

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