by Megan Saunders, italianfood.net correspondent in UK
Many of Italy’s biggest success stories chose to enter the UK market with back up. Carapelli, now the UK’s second biggest olive oil supplier, did it. As did the world’s leading pasta company Barilla. And of course Illy coffee, which secured 54% of its global revenues through exports to markets such as the UK last year. All three Italian brands used a distributor to help them launch in the UK. Rather than invest millions in establishing their own sales and distribution network the approach allowed all three to build a brand and acquire listings without the financial risk. And the move has undoubtedly paid off. So what can a distributor do for an Italian brand? And what are the benefits?
TO AVOID LOGISTICS ISSUES AND TRADE-RELATED RISKS – A distributor acts as an intermediary between the brand and the businesses, or potential businesses, that wish to buy and sell their products, including supermarkets and food service operators. “They enable you to access international markets while avoiding logistics issues and many trade-related risks,” say business advice forum NI Business Info, while also allowing you to avoid currency related risks, and the bureaucracy of customs formalities and paperwork. And crucially “it would be easier for a distributor with an established reputation and contacts list to introduce a new brand to the market than it would be for you,” add NI Business Info.
CASE HISTORY: EURO FOOD BRANDS – Different distributors adopt different models. Some buy up stock and absorb all the risk – along with any potential profits. Others allow brands to hold onto the title of the stock but ask for payments for their services. And others take an equal risk with the brand taking a proportion of the profits only once a deal is done. That final approach is taken by Northampton based Euro Food Brands, the distributor behind some of Italy’s biggest brand exports to the UK. One of the first brands on its books was Barilla, tempted away from its previous distributor Parrish & Fenn by the smaller, more agile service at new starter Euro Food Brands in the nineties. And the pair are still working together more than 20 years later. In 2014 the distributor secured listings in 800 Tesco stores for the dried pasta supplier, its first foray into a major multiple. Proof this longevity is no one off Euro Food Brands also continues to work with Illy coffee, a relationship that began back in 1993. As the brand’s sole UK distributor the firm has helped build the premium coffee from a relative unknown to one of the UK’s most popular brands. UK volumes continue to grow for Illy at approximately 16% year-on-year, far ahead of many of its rivals.
RH AMAR – But they aren’t the only distributor with vast experience in Italian food. Famous for launching the first olive into the UK in 1955 RH Amar has specialised in Mediterranean foods since it was established in 1945. In 2014 it added to its Italian portfolio by signing up Italy’s top tomato brand Mutti. “With a record of supporting growth with eye-catching marketing throughout the globe, Mutti is well placed to make an impact in the UK market,” said RH Amar brand manager James Amar. And Mutti is in good company. They’ll join fellow Italian household names Saclà and Monini olive oils, also distributed by RH Amar. “RH Amar has an extensive sales team that cover the impulse convenience, and wholesale cash & carry customers for Saclà UK,” says Sacla’s Hannah Gutteridge. “They help build our distribution through these channels, and provide our supply chain logistics in to these customers. They are able to bring brands together to make customer meetings more efficient, and more importantly, provide consolidation in logistics that allow the supplier, and the retailers to benefit from efficiencies in supply chain, and back office operations.”
MORE SPECIALIST DISTRIBUTORS – Brands can also opt for more specialist distributors that work solely with Italian brands such as Villa Nova Food, Naturali and J&G Italian Food Distributors. “Our depth and range of knowledge, our collaboration with artisan suppliers along with our flexible approach, allow us to provide a bespoke service,” say specialists J&G. Whichever distributors a brand opts for though the benefit is clear, they won’t be going it alone.