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EXCLUSIVE INTERVIEW BULLA BOUNCES BACK WITH METCASH The question of whether to use direct to store delivery (DSD) or the services of Metcash has confounded many a company, with the answer often not clear-cut but influenced by many factors. To gain some clarity, Retail World chats to Bulla National Sales Manager for Retail Jason Currey about the Australian dairy company’s experience in this area. MBy Nerine Zoio. r Currey explains Bulla made the decision in early 2018 to change over to DSD using a third-party distribution company after being part of Metcash’s distribution centres (DCs) around the country for many years. However, Bulla felt “its projections were not coming to fruition” about a year into using DSD. This resulted in the dairy company returning to Metcash’s DCs in April 2019 following “strong” collaboration with the wholesale distribution company. Challenges, advantages and disadvantages of different approaches Mr Currey says challenges with a DSD model included questions as to whether Bulla would remain competitive on price, the manner in which promotions would be executed, whether any invoicing and delivery challenges would appear and whether they could be easily overcome, and whether the Metcash ‘charge through’ model would be usable. “Delivery challenges included questions as to what the frequency of orders would look like in comparison to products through DCs, especially in rural areas, as well as the flow on of fewer deliveries, which could result in out of stocks (OOS) and their potential impact on distribution,” he said. On a less mundane level, Mr Currey says that the possibility existed that retailers loyal to Metcash could “cease ranging of stock to those perceived as deserters”. Advantages of the DSD model, according to Mr Currey, include – in some areas – increased contact with customers, the ability to immediately respond to issues and for in-store reps to create orders “on the spot” for improved management of OOS, thereby ensuring adequate promotional volumes and NPD ranging. As to using Metcash DCs, he says the biggest challenge centres around compliance. He explains that it’s “vitally important” that Bulla works with all levels of the Metcash model, national office and state office and just as importantly those who run the stores even though it employs a field team to ensure products are consistently on shelves. “Relationships at all levels of the structure are key to success. This ties in with our view of the independent model as a triangle with the three points being the supplier, wholesaler and retailer, which are all charged with responsibilities,” Mr Currey said. “If the trio is aligned, success can be achieved!” He emphasises the numerous touch points from the national office down to the retailer can prove to be advantageous or 20 RETAIL WORLD NOV, 2020