The scale label: to your customers it's an insignificant detail, but to you it’s a vital part of your business. Your scale labels are everywhere. They’re in your deli, on your meat offerings and in your produce section. When the price of paper which creates these scale labels rises, then you have a problem that's anything but insignificant.
Understanding the scale label market
The old adage that less is more is certainly appropriate when describing the current state of the scale label market, where fewer suppliers account for more and more of the market's offerings. Unlike other printed products, many vendors choose not to deal in scale labels because of the product's notoriously low margins. And while only a few suppliers are active in producing this product, market prices have enjoyed relatively little volatility, especially compared to paper prices for other goods.
Yet it seems no good thing truly can last forever, and when the price of paper finally did increase, grocers couldn't help but take notice.
Banding together for a better solution
The price of paper for scale labels saw little fluctuation over the last three to four years, but last spring it jumped. For grocers, this price increase on an essential item was a surprising and unwelcome change that jeopardized their margins. To find a solution that would protect our customers, Topco Indirect went to auction with 10 customers and used the power of aggregation to find a solution that met our customers' needs and worked within their budgets. Four national suppliers responded to the attractive business our 10 customers offered. We pulled pricing and did a thorough price review of each supplier, offering to help our customers find the best match for their needs.
In the end, nine of our customers agreed to award their business to a single supplier and the power of the auction not only protected these customers from a price increase across the industry, it also reduced their previous scale label spend by 2 percent — a significant savings on this vital part of their business.
To learn more about how Topco Indirect can help you protect your margins and reduce the unexpected expenses on essential items, contact us today.
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