SND: RNDC has placed a priority on e-commerce and digital transformation. What is the status of that effort?

Mehall: E-commerce has grown almost threefold since pre-pandemic, although it’s still only mid-single digits as a percentage of the business. We believe this channel will continue to see significant growth. Consumers are spending more time online, and that’s where a lot of decision points are happening. We’re investing in that area with eRNDC. It starts off with the B2B platform, which includes a buy-now feature and improves ordering and the overall experience for our customers. It also gives our sales reps additional tools to be effective at those points of sale and streamline the administrative aspects of the relationship with customers. In the last year we’ve seen traffic on eRNDC grow tenfold, and we don’t anticipate that slowing down at all.

SND: Supply chain issues have been one of the key challenges across the industry lately. Are you expecting improvement in that area as we get deeper into the year?

Mehall: I think 2022 could hold just as many surprises as we had last year. Freight rates continue to be elevated, and I don’t see that changing in the short term. That’s going to put more inflationary pressure on all tiers of the business, and the timelines and disruption around containers continues to be a challenge. It’s something that we’re monitoring very closely with our suppliers, as well as setting expectations with customers around how far out we need to be planning to make sure we minimize disruptions. Most of the consensus points to 2023 before we see any real material easing in the overall supply chain and the bottlenecks we’re experiencing.

SND: RNDC has begun assembling a portfolio of CBD products as consumer interest in the cannabinoid and wellness categories continues to grow. How is the outlook there?

Mehall: This is a fascinating space. It’s clear that CBD usage has climbed significantly since 2019. There’s more acceptance of it, especially with the millennial consumer. We want to explore, learn, and understand the category better. We have a few partnerships on the CBD beverage and seltzer side and we’re active in about 12 markets. The primary focus is around learning who the consumer is, the route to market, and the regulatory aspect. One of the things to keep an eye on is whether the grocery channel and club stores start to bring in CBD products. They have not done that to date, and everyone’s watching the retail environment to see how it develops.

SND: Competition is intense and constant across the wholesale tier. Apart from the sheer size of the company and its footprint, how will RNDC differentiate itself as a preferred partner moving forward?

Mehall: I look at three specific areas, all coming back to our aspiration to be the distributor of choice for both customers and suppliers. Our people and our culture, how we work together as one team across markets and focus on our commitment to execution and performance, is by far number one. The second part is about being consumer-centric, particularly with our capabilities around national accounts. This is where we continue to invest heavily to build out those capabilities as we integrate and bring enhanced resources into our new markets. And third is the organization’s and the ownership’s commitment to reinvest in the marketplace, not just in M&A, but also infrastructure. We’ve already committed to significant investments in California, Florida, and Texas—which are big growth areas—as well as some new facilities that we’re expanding and opening up this year in Kentucky and Georgia. We’re committing sizable investments in our infrastructure and people to make sure we’ve got operational excellence that differentiates us from the competition. We’ve got a significant amount of potential in front of us, and we’re looking to not only react to the evolution of the market but lead and transform the industry as we move forward.