Food distributors are often a necessary part of taking your brand to the next level. Their relationships with retail outlets are invaluable to many up and coming vendors.
But using them correctly requires substantial effort and information. With seemingly hundreds of established and independent food distributors with varying connections, how do you choose when to use whom?
It takes specialized knowledge to assess each’s connections and network strength. However, this is a prerequisite for determining which food distributor to use.
Often the choice will vary based on your product, your market, and your desired customer. Because some distributors have unique connections to grocers or retail outlets, it is best to do your research before starting a new food distributor relationship to see which one is the right fit.
What is a Food Distributor?
Food distributors assist brands in getting more of their products on store shelves, big and small. There are hundreds of food distributors of all sizes.
They have relationships with a diverse set of businesses, from high-volume retailers to independent grocers. For emerging food and beverage manufacturers, distributors can be an essential part of increasing exposure and growing their businesses.
Since distributors take ownership of the product, they also stock inventory, take orders from retailers, manage inventory, and service retailers’ needs.
It is certainly appealing to have this long list of responsibilities taken off your plate. Still, brands need to realize that working with a distributor could mean losing control of the retailer buyer relationship.
Additionally, since distributors represent hundreds, if not thousands, of brands, smaller companies can get lost in the shuffle.
However, they are an almost universal part of establishing footing at up and coming food and beverage brands.
Managing relationships with food distributors can be complicated. Here is some of what you should know when beginning to work with a food distributor.
Overview of Independent Food Distributors
Smaller or independent food distributors have an entirely different set of connections. They typically work with specialized or regional grocery outlets in some regions of the country. These retailers are especially prevalent in the densely populated markets in the Northeast and on the West Coast.
If you are looking to get your product on specialty or independent store shelves, this type of food distributor connection can be invaluable.
However, you should note that most of these organizations do not service large retailers with the same regularity.
Benefits and Drawbacks of Regional Food Distributors
Because of their size and relationships, they have specific benefits and drawbacks. One of the most apparent benefits is their ability to find your brand shelf space at outlets unserved by large distributors like KeHe or UNFI. They also tend to set up more personalized relationships with customers and offer higher customer service levels because of this approach.
A common drawback of working with a smaller distributor comes from the same source as their advantage. Because of their size, they typically lack in streamlined processes and can more challenging to set expectations with than their larger competitors.
They may not work with you to find best-fit delivery appointments, which can stress your production facilities and supply chain. This challenge usually is due to a smaller customer portfolio, which means your product matters more disproportionally to them.
Similarly, they may only be able to secure your shelf space in one specific store in a particular area. Their relationships might not extend beyond their region.
It is likely best for brands to use multiple regional or independent food distributors. But managing numerous distributor relationships can be complicated and time-consuming.
Overview of Large Food Distributors
Food distributors are third-party entities that act as middlemen between your brand and a retailer. Large food distributors, like KeHE or UNFI, purchase products from vendors to disperse them among their established high-volume retail connections.
Who they sell to varies by the distributor as some have strong, singular connections with retailers as reflected in the UNFI and Whole Foods relationship. Whole Foods almost solely relies on its distributor, UNFI, to introduce new brands into the network.
When looking to secure shelf space at some of the largest retailers in the country, large food distributors are likely the choice to pursue. In cases like UNFI and Whole Foods, the distributor acts as a gatekeeper and is the primary route to get your brand in stores across the country.
Benefits and Drawbacks of Large Food Distributors
Just like small distributors, industry leaders have an advantage over their peers with their established relationships. But unlike the less sophisticated operations, large food distributors typically have nationwide connections that cover retailers regardless of their region. Meaning, UNFI can distribute your product as easily in California as it can in New York because of the organizations’ strong relationship.
This fact makes large food distributors an excellent choice for brands looking to break in and stay at sizeable retail grocery outlets. These larger distributors typically wield more influence and can get your organization more favorable outcomes at retailers. Some will even allow you to test products in different markets, which can be great when establishing a new line.
But again, there are a few disadvantages to working with large industry-leading distributors. Due to their size, working with big food distributors can often be an impersonal relationship. Communication with them can be a challenge. And they typically have stiffer penalties for missed appointments.
Additionally, because of their popularity, often you can find backed up delivery facilities, which can cost you in detention time or cause missed appointments.
Using them requires organizations to actively manage the relationship, which can be difficult for emerging brands because of the personnel it requires.
Work with a Logistics Partner to Manage Food Distributor Relationships
Irrespective of size or sophistication, food distributors, both big and small, are often a necessary part of a brand’s growth strategy. Many distributors function as gatekeepers at certain retail outlets. They are therefore needed to secure shelf space and increase exposure.
To get the most out of these relationships, you will need to actively manage the relationship effectively setting expectations and establishing a cadence of best fit.
Zipline Logistics works with every type of food distributor. We can help you create a distributor strategy that optimizes your production and supply chain functions, putting you in the best position to maximize the benefits of the relationship.
Interested in seeing how we can help?