Shipping to UNFI or KeHE? 3 Fulfillment Challenges Growing Brands Should Prepare For

Growing from a direct-to-consumer (DTC) brand into retail distribution is an exciting milestone. Working with a distributor like UNFI or KeHE can help put your products in front of a broader retail audience and open another channel for growth.

But it also introduces a different fulfillment model. For brands making the move into retail, there are two important questions to consider:

1. Which distributor makes sense for our business?
2. Once we have the opportunity, is our fulfillment operation prepared to execute it?

Getting the relationship with UNFI or KeHE doesn’t automatically mean the processes that worked for your DTC business are ready for distributor fulfillment. Before orders start moving, brands need to account for new requirements around how products are configured, prepared, labeled, documented, communicated and delivered.

UNFI or KeHE: How Do You Know Which One Is Right for Your Brand?

UNFI and KeHE are both major distributors serving retailers across the grocery and natural products space, but choosing between them isn’t necessarily a matter of determining which distributor is “better.” The right path can depend on your product category, target retailers, geographic goals, existing buyer relationships and the distribution opportunities available to your brand. In some cases, the retailers you’re pursuing and their existing distributor relationships may help determine which path makes the most sense.

As brands grow their retail presence, they may eventually find themselves working with both UNFI and KeHE. That creates another consideration beyond landing the business: Can your fulfillment operation support the requirements of multiple B2B channels while continuing to serve your DTC customers?

Before pursuing either path, consider where your target customers shop, which retailers you’re trying to reach, what distributor relationships support those retailers and what new operational requirements your business will need to meet.

Whichever Path You Take, Prepare for These Fulfillment Challenges

The exact requirements differ between UNFI and KeHE, but the operational challenges brands encounter tend to fall into a few common areas.

1. Compliance Requirements Change the Way You Fulfill Orders

Distributor fulfillment isn’t simply DTC fulfillment on a larger scale. UNFI and KeHE establish requirements that can affect product and case configuration, labeling, pallet preparation, documentation, product dating, routing, scheduling and delivery. Processes built primarily around picking individual units and shipping parcels directly to consumers may not account for those requirements.

That means your distributor requirements need to make their way into the actual processes happening inside the warehouse. The fulfillment team needs to know what it’s picking and how products should be prepared. Transportation partners need the appropriate routing and scheduling information. Systems need to support the required order and shipment information.

Knowing the requirements is one thing. Consistently translating them into execution is what matters.

2. Compliance Mistakes Can Turn Into Chargebacks and Added Costs

Those operational details matter because mistakes can have financial consequences. Incorrect labeling, shipment preparation, documentation, timing and other compliance issues can contribute to chargebacks, additional fees, receiving problems or delays. For a brand adding retail distribution, those costs can quickly take some of the shine off a new growth opportunity.

That’s why operational readiness should start before the first purchase order hits the warehouse. Rather than focusing solely on getting that first distributor order out the door, brands should think about whether they have a repeatable process for getting orders out correctly as volume increases.

The more orders you ship, the more important consistency becomes.

3. Integration Can Become a Bottleneck as Volume Grows

Physical shipment is only one side of distributor fulfillment. The information behind the order needs to move too. Electronic Data Interchange (EDI) can be used to exchange information between the distributor, brand and fulfillment operation, including incoming purchase orders and outgoing shipment information.

Brands can work with an EDI provider such as SPS Commerce to establish these connections, but integrations take time to set up. During launch, some processes may need to be handled manually while systems and automation are being established. That may work for a small number of orders. As retail volume increases, however, manual processing can require more labor and create more opportunities for error.

It’s worth asking early: If your UNFI or KeHE volume doubled tomorrow, could your current process keep up?

Rather Have an Experienced Team Manage It?

You don’t have to build distributor fulfillment expertise entirely in-house. FIDELITONE helps growing brands manage the operational side of retail expansion by bringing DTC and B2B fulfillment, distributor experience and integration capabilities together under one fulfillment partner.

Our team can help translate distributor requirements into day-to-day warehouse execution and support the EDI and shipment workflows needed to keep information moving between your systems and your distributor. That means you can focus on growing the retail opportunity while working with a fulfillment partner that already has experience supporting the operational requirements behind it.

Talk with FIDELITONE about supporting your UNFI or KeHE fulfillment needs.