Wholesale channel overperforms in Scotland versus England and Wales

Research commissioned by the Scottish Wholesale Association (SWA) has shown that Scotland is overperforming versus England and Wales in several route-to-market channels.

A wholesale channel update was presented at an online seminar during which insight specialists TWC and HDI shared details of how GB wholesale, convenience retail and hospitality is performing alongside an update of Scottish sales and trends.

Tanya Pepin, managing director of TWC, said: “TWC provided an update on wholesale sales performance based on access to data from 75 wholesalers across GB. Foodservice is currently showing strong growth while wholesale into retail is flatter. In both channels, Scotland is over-indexing on value growth.”

Colin Smith: ‘The findings from TWC and HDI tell us that there is optimism within the Scottish wholesale sector.’

However, according to TWC’s SmartView Convenience service, Scotland is the top-performing region in value for retail. Pepin continued: “TWC also used SmartView Convenience – our market read for sales through wholesaler-supplied symbol and fascia as well as independent convenience stores in GB – to provide an update on convenience retail performance as well as an insight into Scottish performance versus England and Wales.

“Again, Scotland showed strong results, with the largest regional share of convenience retail value sales of all GB geographies – and the best year-on-year results of all regions.”

The data further revealed that at a product category level, all impulse categories are in value growth for the latest 52 weeks and Scotland’s growth is ahead of the rest of GB. “In fact, across seven of the 10 core retail categories, Scotland is reporting stronger year-on-year results,” Pepin added.

She continued: “Finally, there is good news for Scottish wholesale-supplied symbols/fascias. Despite them having a lower share of stores numerically than England and Wales, they outperform on share of retail units sold, and Scottish symbols and fascias have more items in their baskets than their English and Welsh counterparts.”

Data presented at the SWA online seminar included card spending insight from the HDI Panel which tracks the day-by-day spending of 10.2 million people across 160,000 hospitality venues and over 40,000 grocery and convenience stores.

Mark Bentley, business development director at HDI, said: “Scotland’s hospitality sales grew by 2.1% year on year in Q2 2024, outperforming the overall UK hospitality sector. Pubs and bars led the market outperformance, followed by unbranded pubs and bars, casual dining, and coffee and sandwich shops.”

The last five years, Bentley pointed out, “have been an unprecedented period for the hospitality sector, with businesses needing to navigate the pandemic, cost-of-living crisis and continual curveballs”.

He added: “Inflationary pressures are one of the many challenges that businesses have had to navigate – the extent of this can be seen by the fact that the average cost of a main course in Scottish managed pubs and bars has increased by £1.51 (+14.2%) over the last two years. Drink prices in the same establishments rose by an average of 45p (+13.5%).”

However, Bentley pointed to growth opportunities: “Despite challenging market conditions, there are opportunities for growth in the hospitality sector. Key opportunities include focusing on winning market share and leveraging data to make better business decisions.”

SWA chief executive Colin Smith highlighted the current high levels of confidence among Scottish wholesalers. “This insightful market overview doesn’t mask the fact that businesses are facing significant cost pressures from high employee, materials and energy costs,” he said.

“However, the findings from TWC and HDI tell us that there is optimism within the Scottish wholesale sector and our performance versus England and Wales is heartening in a market that has witnessed considerable challenges and change over the last five years.

“Clearly, local and regional market dynamics are also at play, but this market review can help wholesalers focus on the key challenges and opportunities for growth at time when there is an evolving regulatory environment.

“That said, Scottish wholesalers recognise the need for strategic investment and growth.”