Matt Collins (pictured), trading director at KP Snacks, explains how the supplier supports the trade by acting on insight to respond to, and influence, shopper habits.
The amount of business that KP Snacks conducts with cash & carries and delivered wholesalers has increased over the last five years, and there’s more growth to come, according to trading director Matt Collins.
“We are very passionate about wholesale – we champion it – and we think it remains a real growth channel,” he says.
“At KP, we are not a grocery-led business, we are a multi-channel-led business,” he adds. “We recognise the differences within wholesale, from national wholesale to independent wholesale, and from wholesalers supplying retail to those supplying catering, foodservice and the on-trade.
“I’m lucky to have a hugely experienced and dedicated wholesale team that really understands the channel and my role is to support them and to represent the channel internally, making sure it gets a good share of voice in our business.”
When the COVID crisis began, KP’s employees, including its field sales team, moved to home working straight away, but this was not detrimental to its dealings with cash & carries and delivered wholesalers; in fact, the opposite was true. “I think that having virtual meetings actually strengthened our relationships with wholesalers,” says Collins, who has been with KP for more than seven years.
“Everybody got to see people in their homes – we became a bit more aware of each other’s lives – and at the height of the crisis there was an opportunity to show that partnerships really mattered. We were able to collaborate even better than before.”
Although KP did make minor adjustments to its range to focus on the best-sellers, it kept its supply chain going “really well” by optimising output, Collins reports. “We heard a lot of stories in the trade about deprioritisation of channels in terms of production and stock allocation, but any choices we made at KP were completely equitable across the market. By default, because we champion wholesale, our supply to wholesale was excellent.
“We maintained our excellent service and availability throughout – there was no change to minimum order or consolidation of orders – and that continues today, even with the shortage of HGV drivers in the UK.”
When Collins spoke to Cash & Carry Management (mid-July), third-party agency Avansa, which works in wholesale depots on KP’s behalf to showcase deals, loyalty schemes and new products, was already back in the field.
KP is well aware of changes in consumer shopping habits precipitated by the pandemic, such as the increase in demand for sharing packs and multipacks, and it uses data and insight to guide its business and the advice it gives to its customers. It also meets with a panel of convenience retailers (both symbol group and unaffiliated) to discuss market developments though its Ambassadors Forum, which is part of its SnacKPartners category management programme. Feedback from the retailers can influence KP’s plans.
Collins says: “We recognise that convenience retailers don’t have rubber walls and that space is at a premium. It is about making sure the right space is allocated to the right range.
“Ultimately the pack format comes down to the occasion and the mission. Whether it’s multipacks, sharing packs or singles, the space should be adjusted according to what the pick-up is. We see a huge opportunity to help convenience retailers retain the bigger basket and top-up shop they gained during the pandemic.”
Over the past year, KP has seen surges in sales of many of its products, including KP Nuts and Butterkist, as well as £1 price-marked packs, and the company has recently expanded its Tyrrells range with £1 PMPs for three core flavours. “The results after only two weeks in the market are phenomenal!” Collins reports.
The launch of the Tyrrells £1 PMPs follows the successful introduction of the same format for Discos Salt & Vinegar and its “golden piece of innovation” for this year, McCoy’s Fire Pit, which has achieved sales of £3.2 million since launch (Nielsen) and is also available as £1 PMPs.
“When we bring out NPD, it is important that we do so in the right formats for the right channel,” says Collins. “We know that PMPs work really well in convenience – they reassure consumers of value and help retailers with the pricing. Equally, we have to make sure that there is the ability for everyone to make a competitive margin.”
To support retailers in recovering and driving their sales of singles, KP recently launched a ‘Win £2021’ promotion on Hula Hoops, McCoy’s, Skips, Nik Naks, Discos, and Wheat Crunchies in grab bags and £1 price-marked packs. Running until 12 November, the campaign offers shoppers the chance to ‘win the year in cash’ by texting a number highlighted on the special packs.
Collins points out that in the last 12 weeks, singles have grown by 37.8%. “We are seeing the single-eat occasion coming back as people are more transient, more mobile, but it is still down compared to 2019 – indexing at 80-82% versus 2019. However, because food to go was a hero category to drive footfall and rate of purchase, our view is that it will probably be back to 2019 levels by September/October,” he says.
As far as NPD is concerned, Collins believes it should meet certain criteria: “NPD in this category, as in any impulse category, plays a pivotal role but it’s about the right NPD – it’s not about bringing out ’me too’ products or proliferation, it’s about adding excitement.”
He continues: “The best way to win in the crisps, snacks, nuts and popcorn category is to make sure there is availability of the core range. The challenge then – with NPD, limited editions, etc – is to add value, not complexity. It is about understanding what consumers want and what customers want, and how we can best serve them.”
One important issue for KP is the HFSS (High in Fat, Sugar or Salt) legislation, which is expected to take effect in April 2022. “We have already been working towards it as part of our ‘Taste for Good’ strategy – it was one of the reasons for acquiring the Popchips brand, and we are working on some of our other products to offer a range of lines below 100 calories,” says Collins.
KP is waiting for feedback from the HFSS consultation and is considering how to embrace the legislation. “Part of that will be about reformulating existing products, part of that will be about innovating,” he explains. “Equally there will be a big chunk of the portfolio that isn’t right to become HFSS compliant because it delivers through taste characteristics that consumers don’t want us to change.”
Aside from HFSS-triggered developments, KP has plenty of activity in the pipeline, including a Tyrrells on-pack promotion starting in September to support the Licensed Trade Charity, which helps people in need who work in pubs, bars and breweries. The promotion will run on a number of Tyrrells 40g flavours that are popular in the on-trade.
Tyrrells is one of eight brands that are currently promoting KP’s sponsorship of The Hundred, a new 100-ball cricket competition. Over the next five years, this partnership is aimed at inspiring people to get more active, while driving sales of KP’s core range.
Moving into the autumn, the supplier will be supporting Butterkist with an on-pack promotion that will add value to the family sharing occasion, and there will activity around the back to school occasion and Christmas. In addition, KP will continue to run bespoke promotions with individual wholesalers.
Collins concludes: “Without our trade partners we can’t win. Wholesale is a dynamic and exciting channel and it is incredibly valuable to us. It will continue to form an important part of our strategy and plans.”
KP has a four-pillar plan to make the most of the crisps, snacks, nuts and popcorn segments:
• More from core – focusing on the best-sellers that consumers want day in, day out.
• Sprinkle of NPD – bringing out NPD that is going to add excitement and incremental sales, and be on-trend, sustainable, heavily supported, in the right format and the right case size.
• Events and activation – maximising events, bringing excitement to store, and driving weight of purchase, such as by ‘perfect pairings’ – KP Nuts with beer or McCoy’s with a soft drink in a meal deal.
• Insight-led – understanding market trends, data, insight, shopper habits and consumer habits.
Tel: KP Snacks (0845) 601 7583
Published Date: August 9, 2021