WSJ Cites Distributors As Culprit for Grocery Price Increases – We Have the Solution

by: Grovara

Why does everything seem like it costs a lot more?

Because it does. Consumer prices have increased more than 21% since February 2020.

Price increases impacting a wide range of industries were a flash point in the recent presidential election, draining consumers and making many brands scratch their heads over the last several years. 

We have long been preaching about the wasted time and profit that has traditionally festered in exporting, where we first aimed our platform technology to streamline the sales processes and create efficiencies. Part of undoing that manual mess is moving away from the spreadsheets and emails of physical distributors and toward our solution, which automates many crucial steps like documentation, labeling, and communication.

Now, the Wall Street Journal chimes in how rising grocery prices plaguing the U.S. and beyond are largely due to a ragtag network of distributors with varying levels of sophistication, speciality, and integrity. According to WSJ:

The granola maker, Wildway Foods, said the cost of making the cereal hasn’t gone up that much, and that it isn’t pocketing more profit. It jacked up the price, it said, in large part to offset fees that piled up from a little-known link in the supply chain: grocery distributors.

Many small manufacturers that have raised their prices have another explanation. They say they also are being squeezed by the distributors who act as gatekeepers to many supermarkets. 

Distributors are the middlemen of the grocery business. They buy products from food makers—many of them too small to run their own distribution networks—then store, sell and ship them to supermarkets. A small number of them, including KeHE Distributors, C&S and United Natural Foods, or UNFI, sell to grocery stores nationwide.

These distributors take a piece of the action at every turn and provide very little in return, sometimes turning over a sale three or four times before product meets shelf. This waste is just one of many reasons why Grovara does what we do. Quite simply, there’s a better way, and we are proud to have developed it first and are now offering a safe, all-in-one way to conduct B2B wholesale transactions without blowing profit on middlemen or raising prices on customers.

Grovara’s technology platform and marketplace take specific aim at the manual processes, making it easier for brands to sell anywhere in the world without sacrificing profit:

  • Two-way discovery that easily and directly matches vetted brands and retailers
  • Pallet-Builder tool enables more accurate, efficient, and cost-effective ordering
  • Fast online global payment processing via Stripe – no waiting on wires or checks
  • Automated in-country registration and compliance and digital global fulfillment
  • Automated Document Manager and Audit Trail keeps transactions transparent and on-task
  • Data Insights on products and Performance Reports on sales keep buyers and sellers on track

Many parts of selling require a human touch – relationships, customer service, and marketing, to name a few. But those brands and retailers who continue to work out of spreadsheets and email will sell slower and less profitably than those using tech to move product. 

Over the last decade-plus facilitating B2B wholesale transactions all over the world, we’ve encountered the same bad actors that are threatening grocery prices as well as those who perpetrated the PPE crisis during the COVID-19 pandemic. For as long as prospecting, orders and payments are done out of emails and spreadsheets, risk will follow wherever there is CPG velocity.

The safety our all-in-one platform enables is being sought by some of the most innovative brands in the world, like True Citrus, Honey Stinger, and Nature’s Way, and operating in more than 40 countries. Our expansion into 10 new complimentary verticals over the next 12 months is a clear indication that there’s a need in the market for a safer solution powered by data and AI. 

And our platform is the only one that has it and can do it all. 

To book a demo, email us here.