Created on 6/9/2016 1:37:55 PM
MISSISSAUGA, ON -- Sustaining growth and increasing profit margins are significant challenges for CPG companies globally, making the need to re-think our approach to the market even greater. Thought-leaders shared insights with FCPC members on the “New Normal,” citing key changes affecting industry and the impact these changes are having on our industry.
Jaya Pandrangi, Principal, Strategy& (part of the PwC network) presented strategies for lean, cost-effective CPG organizations. Followed with a Q&A session with Dan Magliocco, President of Mondelez Canada and Lino Casalino, Partner, Consulting and Deals at PwC. They discussed the CPG world's widespread restructuring activities and continued pressure on cost structures. "You can’t cut your way to prosperity," Magliocco stated. "You need to grow and extract more value." He said that change is a "constant" today, not an "episode," adding, that "it is the new normal."
“Innovations with ‘premiumization’ drive tremendous growth,” said Rick Winslow, Senior Vice President of Sales Effectiveness & Technology Enablement at Nielsen. “For example, pink Himalayan salt costs three times more than regular salt.” Winslow and Tom Hansson, Managing Director at Strategy&, spoke about how leading CPG companies are innovating, offering new products and “stepping out” of traditional channels to grow and outperform GDP. “Cultural reboot on innovation is equal to cost reduction,” said Hansson.
K.B. Clausen, Principal, Strategy&, and Dina Ignjatovic, Economist at TD Bank, told the audience that CPG organizations are particularly susceptible to fluctuations in commodities and the Canadian dollar – with exporters primarily winning while importers are mostly losing. Their presentations outlined tactics, such as integrated margin management, for minimizing the impact of such fluctuations.
Robert Baker, Director, Strategy&, shared and analyzed trade investment survey results from Canada and the U.S. In a moderated session, Eric Sweezey, Director of Finance M&A Integrations at The Hershey Company, outlined how some CPG companies are using analytics to inform their trade investment decisions to create win-win scenarios for their organizations, their retail customers and the consumer.
To sum up, a weak Canadian dollar, limited population growth and a highly consolidated retail environment are the “New Normal.” As an industry, we need to be more effective in managing people, our investments, our operations and our processes.
PwC is currently in the process of compiling a 60-minute Executive Briefing of their presentation materials and will make this available to FCPC member companies who either could not attend, or to attendees who are interested in briefing their colleagues or executive teams in a smaller, more intimate format. Anyone interested in receiving this briefing from PwC should contact Lino Casalino at 416-815-5263.
For more information about upcoming FCPC insight events, please click here.