Revenue growth & margin improvement

How can I continue to generate growth in this challenging environment?
As retail & consumer products companies continue to navigate through the downturn, it becomes critical to successfully manage margins. Margins are being squeezed from rising input costs (commodity and energy) and an inability to pass these costs along due to low inflation, consolidation in the industry which is driving greater operational efficiencies, and private-label competition displacing national branded products. In this environment, companies need to formulate and execute strategically aligned cost initiatives across the entire organization, to include HR, Finance, Operations, IT and Sales & Marketing. It is becoming increasing imperative to mitigate pricing pressure with reformulations, product innovation, supply agreements, changing product mix, and distribution channel collaboration. Proper planning and the implementation of effective cost reduction programs can help companies achieve competitive advantage and maintain profitable growth.

How PwC can help

Our retail and consumer professionals offer a full range of solutions to help positions your company for continued revenue growth today and in the future. Our experienced team of professionals can help you through our services related to:

• Increasing margin pressures

  Margins are being squeezed from an inability to increase prices due to low inflation, consolidation the in the industry, blurring of roles along the supply chain, and private-label competition, as well as rising input, commodity and energy costs. In today's environment, consumers are unwilling to absorb increases in price - further forcing retail and consumer companies to develop a pinpoint focus on cost management. Our professionals can help your company aggressively manage costs through process improvement , inventory management, technology and outsourcing solutions. By leveraging our services, your organization will be prepared to combat tightening margins and will benefit from a more efficient cost structure, as well as supply chain, process and portfolio improvements and other strategic savings opportunities.

• Globalization

  Competitive pressures, maturing markets, domestic market saturation, tightening margins and a need to grow top-line revenues are encouraging retail and consumer companies to pursue opportunities in the global market. The decline of the dollar has strengthened the global economy and put additional upward pressure on domestically produced products. To drive profitable growth, companies must have a strategy to capture emerging market opportunities, choose the ‘right’ market, and implement appropriate business models for new markets. PwC has professionals in over 160 local markets to help companies conduct risk and readiness analyses and to develop a roadmap to success from business case to the right model to logistics. Whether it is leveraging our HR specialists to help establish your people & culture change management, or working with our tax professionals on your tax strategy and global planning needs, we can help you find success in today's global marketplace.

• Consolidation: Acquisitions/Divestitures

  For the retail sector: As a result of more and more companies searching for the proper business model and portfolio mix to drive growth and bottom line results, there is an increasing volume of transactions in the industry. Retailers needing to increase sales and profit margins are expanding to global markets and consolidating to realize greater power in dealing with their suppliers. The key challenge lies in the proper execution at both ends of a transaction to include proactive planning, the correct targeting strategy, due diligence and execution planning. Our transaction services professionals can assist with the strategic, operational or financial aspects of a deal. They can help, with limited disruption to your core business to bring key deal issues to the forefront early in the process, enabling management and the investment bank to be proactive.
  For the consumer products sector: As more companies search for the proper business model and portfolio mix to drive growth and bottom line results, there is an increasing volume of transactions in the industry. Competitive pressures compounded by shrinking sales growth and profit margins are encouraging companies of all types to pursue consolidation. Consumer Products companies are under pressure to deliver cheaper priced products and to deal more efficiently with retailers, who want to deliver everyday low prices. The key challenge lies in the proper execution at both ends of a transaction to include proactive planning, the correct targeting strategy, due diligence and execution planning. Our transaction services professionals can assist with the strategic, operational or financial aspects of a deal. They can help, with limited disruption to your core business. to bring key deal issues to the forefront early in the process, enabling management and the investment bank to be proactive.

• Corporate social responsibility/Sustainability

  Social, human resource, environmental, and community responsibility concerns have resulted in new initiatives on sourcing, healthier products like right size portions, more efficient packaging incorporating recycled materials, cleaner manufacturing, less harmful emissions, and the use of renewable energy in manufacturing environments. Amid complex stakeholder demands and resource constraints, companies need to prioritize those initiatives that will provide an effective return on investment, while communicating transparently and effectively. Our point of view is that sustainability is an enterprise-wide issue - no longer just an environmental one - that impacts compliance, strategy, operational, financial and compliance issues. Through in -depth discussions on the components of sustainability, PwC can help you focus on three key areas - strategy, compliance, and reporting - and integrate change management that is rewarded by consumers, stakeholders and the financial markets.

• Organizational agility

  Today’s environment of constant, relentless change demands a new approach to business. To continue to experience revenue growth, R&C companies need to determine core processes that create the most value, align around them, and communicate a shared vision throughout the organization. PwC's point of view is that programs need to be developed to embed culture change into the DNA of your company. By leveraging PwC’s global resources experiences in designing metrics and rewards systems to effectively support corporate strategy, companies can properly align skills, organizational structure, incentive programs and corporate culture to their business objectives.

• Shifting consumer shopping and purchase patterns

  For the retail sector: Consumers are shifting their buying patterns in many ways as a response to the challenging economy and rising costs. Not only are they altering what and how much they buy, but they doing more comparative shopping, changing where they shop, reducing the distances they are willing to travel to shop, and are putting more consideration into the number of shopping trips they are willing to make. Retailers need to respond to this changing demand with increased emphasis on retail formats that are friendlier to this consumer change. Our professionals bring the appropriate skill sets to your needs by combing industry knowledge, business maturity and business process skills to help you to address and resolve customer and product profitability issues, and to establish proper measurement tools to provide visibility and assess ongoing performance against other objectives. By effectively managing these change events, companies can experience an accelerated execution of revenue growth and cost management strategies.
  
  For the consumer products sector: Consumers are shifting their buying patterns in many ways as a response to the challenging economy and rising costs. They are not only altering what and how much they buy, but they are also doing more comparative shopping,changing where they shop, reducing the distances they are willing to travel to shop, and are putting more consideration into the number of shopping trips that are willing to make. For manufacturers, this places an emphasis on product innovation and new category entrants to woo consumers, but it also raises new challenges for products with unique logistical requirements ( fresh produce, baked goods, frozen products, etc). Our professionals bring the appropriate skill sets combing industry knowledge, business maturity and business process skills to help you to address and resolve customer and product profitability issues, and to establish proper measurement tools to provide visibility and assess ongoing performance against other objectives. By effectively managing these change events, companies can experiences an accelerated execution of revenue growth and cost management strategies.

• Focus on health and wellness products

  Consumers are increasingly aware of the ingredients contained in products that they consume and use, want to feel good about what they consume, and are interested in the integrity of the supply chain and the source of the foods they are ingesting. Companies across the distribution channel are responding to these changing consumer preferences with product offerings that emphasize health and wellness as an important component of their products. We can team with your company to leverage new opportunities for product innovation, brand positioning, new messaging around product offerings, and supply chain issues to help you increase revenue opportunities.

• Media/promotional effectiveness

  Marketing and promotional spend is one of the retail and consumer industry's largest expenses. However, traditional methods and measures of advertising reach and sales uplift are not refined enough to satisfy the demand for managing such a large element of spend. Ineffective controls and lack of performance measurement can result in inefficiencies that reduce growth and profitability. As media outlets shift from traditional print to focused digital alternatives and as promotional spend gains focus with a reduction in brand distribution points through retailer consolidation, these areas will become even more important in the future. By facilitating the improvement of internal controls, reporting, and measurement of your promotional investment, we can help you gain awareness of your spend effectiveness and help drive better decision making.