Selling online for 20 years, US Foods has built ecommerce into a crucial channel where three-quarters of its more than 250,000 customers go online to order products from its base of 350,000 SKUs.
The distributor of food and related products, with more than $24 billion in sales for the fiscal year ended Dec. 29, 2018, has built up a strength in ecommerce sales to restaurants, corporate kitchens, grocers and others by learning what customers need and how they prefer to buy it, Gene Carbonara, vice president of ecommerce and digital, said during the B2B workshop track at the 2019 IRCE @ RetailX conference.
The company’s entry into ecommerce was prompted by major hotel chains, who needed 24/7 access to products ranging from food products and cooking equipment for their restaurants, in-room meal service and on-site convenience stores to hand soap and towels for their hotel guest rooms. “Our move to ecommerce was necessitated by our largest customers,” Carbonara said.
Helping out busy chefs
From there, US Foods went to apply what it learned about ecommerce to other customers as well, developing ways to help small as well as large companies better operate their businesses. Carbonara noted that 60% of restaurants fail within their first year, and 80% within five years, so US Foods has devised ways to help them better manage their product inventory and profit margins. “Many of our customers are chefs, so we help them with menu-planning and profitability,” he said.
One way is through developing customized product-ordering lists that organize the particular type of products a customer routinely orders. The distributor’s customers order 300 products in an average-size order, and assistance in managing product lists has shown to increase order accuracy and reduce the number of product returns.
For example, Carbonara said, “PF Chang can’t buy just any rice,” Carbonara said. “It needs to be standardized. Understanding your inventory is essential to running a business.”
Hold those French fries
The average customer orders from US Foods more than twice a week, and often needs to order quickly as if their “hair’s on fire,” he added. To help ensure they order what they need, US Foods uses data compiled on customers’ past orders to give them online alerts during the ordering and checkout process asking if they forgot to order a particular item.
The distributor has also learned to improve online product recommendations by combining multiple elements of information on products and customers’ needs, including sales reps, web analytics and current inventory records. Carbonara noted one example of how US Foods will recommend oven-baked French fries to a commercial kitchen based in a high-rise building. “We have to use all three elements,” he said, to realize that the customer serves French fries, but that it’s based in a high-rise building where it can’t use an oil-filled deep fryer, and needs to order only available French fries made for baking in an oven.
Even with its large volume of online orders, however, US Foods is still working to improve and increase the number of ways customers can order through self-service ecommerce to make their jobs easier. “We’re not quite there yet,” Carbonara said.
Other things it’s looking into include are wearable mobile devices customers can use to place online orders.
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