Categories
Featured

eVolution or reVolution?

\"\"BE THE FIRST TO GET ALL THE JUICY DETAILS!

[gravityform id=\”4\” title=\”false\” description=\”false\”]

Categories
Featured grocery

Four Forces Shaping Retail in 2017

\"revolution\"As we approach the end of 2016 and the start of a new year, predictions and lists for the year to come become prevalent. This list from Stamford Connecticut-based, Daymon reveals their prognostications for 2017. “There’s no denying that the fundamental rules of retail are being rewritten,” said Jim Holbrook, CEO, Daymon. “To stay relevant and successful next year, retailers and manufacturers must focus on these areas as they evolve to the new way of retailing.” The four forces shaping retail next year are:

Shopper Participation
Thanks to the digital revolution, shoppers feel empowered to take things into their own hands. Increasingly, they desire to influence not only their own choices but also broader positive change. To address this shift, retailers and manufacturers must move beyond traditional shopper segmentation and address commonalities in consumer need states that transcend demographics. They should work to tap into the new “participatory shopper” by providing opportunities for consumers to co-create and act as brand marketers.

Destination Retailing
In the landscape of ever-evolving physical and digital store formats, retailers must create attractive destinations to drive in-store traffic. Traditional definitions of categories can no longer dictate the journey through the store. Shoppers want tailored solutions that lead to experiences – not just transactions. Retailers should continue to focus on creating branded destinations with products and services that establish authority in high-volume areas of the store while also finding innovative ways to deliver differentiated solutions and shareable experiences.

Precision Wellness
Thanks to sophisticated wearable activity trackers, personalized DNA profiling, and other new wellness services, consumer self-knowledge is expanding dramatically. Consumers can now track daily lifestyle and dietary habits, scan their DNA for genetic markers of disease or dietary intolerance, and more. This trend is only set to grow, providing new opportunities for retailers to create personalized offerings for the self-aware shopper and to position themselves as partners in their customer’s wellness journey.

Redefinition of Convenience
In our increasingly digitized and urbanized world, the definition of “convenience” is rapidly changing. Much of this change is and will continue to be driven by new technology. To stay relevant, retailers and manufacturers must work to identify and begin investing in innovations that will help them commercialize the store of the future, giving customers what they want, when they want it.

Categories
grocery

Private Brand More Than Cost

\"Deloitte\"The retail landscape is evolving dramatically, as technology-enabled shoppers demand new products with higher visibility into how they are being sourced. Private Label continues to represent a significant opportunity for retailers to drive margin, differentiate products, and serve consumers’ wide–and changing–tastes.

Deloitte’s 2015-2016 Private Label sourcing survey highlights shifts in market trends and uncovers leading Private Label sourcing practices. With 388 respondents from Apparel, General Merchandise, and Grocery retailers, the 2015-2016 survey builds on the findings of our 2012-2013 assessment and dives deeper into industry trends, including:

  • More than cost: Retailers reported they are focusing efforts on product quality, speed to market and mitigating risk to satisfy consumers, with the majority ranking quality assurance programs as the top strategic response for the second year running
  • Fewer, deeper manufacturer relationships: With 3 in 4 retailers already or planning to consolidate vendors, the industry is placing bigger bets on fewer manufacturers, causing potential ripple effects that could upset the current sourcing landscape
  • Mixed success on reshoring: Reshoring production to domestic vendors was retailers’ top emerging response to market pressures with nearly one third planning to reshore in the future. However, across categories, only 50-70% of those attempting to reshore have succeeded
  • Movement in the source of supply: The survey captures retailers’ historical and projected sourcing footprints
  • The evolving sourcing organization: Retailers are making significant investments in advanced technology to manage private label sourcing, in addition to evolving the operating model, governance, and tax strategies

Explore the survey findings

2015-2016 Private Label sourcing survey

Categories
global

Aldi \”Like Brands. Only Cheaper\”

Due to the success of the \”Like Brands. Only Cheaper\” campaign originally launched in 2011, ALDI Australia has introduced a number of new TV commercials including one for its Ombra private brand sunscreen. The campaign aims to humorously point out the cheaper price options available at ALDI for very private brands found at other supermarkets.

The latest featured a vampire who loves sunscreen but hates the living.

https://www.youtube.com/watch?v=yp5kULnFhm8

 

 

 

 

Categories
grocery

Volatility Squeezing Global Private Label Supply Chain

\"GroceryRising and increasingly volatile costs dominate retailers’ top challenges sourcing private label goods, while changes in consumer behavior fueled by mobility and online shopping are driving the strategic importance of private label sourcing, according to a new Deloitte study, “Private Label Sourcing: Strategies to Differentiate and Defend.”

“Rapid population growth, skewed to developing regions, is increasing demand on raw material sources while providing new markets for low-cost labor,” said Michael Daher, principal and Retail Sourcing Practice leader, Deloitte Consulting LLP.  “Additionally, online, mobile and social channels continue to disrupt the retail landscape.  As low-cost online competitors continue to expand across more categories, private label provides an opportunity for retailers to defend their marketshare by offering products that are exclusive to their banner.  But it’s not the ‘copy and paste’ private label we grew up with—these are innovative private label brands that require more sophisticated sourcing capabilities.”

Deloitte’s Private Label Sourcing Study – one of the largest and most comprehensive to date – analyzed responses from more than 260 executives from apparel, general merchandise and grocery retailers to uncover shifts in market trends and private label sourcing practices.
The survey asked respondents to rank their top market pressures.  Respondents indicated that raw material cost increases and volatility were considered the top market pressures, followed by rising labor wages and fuel price volatility.  Raw materials, production labor costs and transportation costs account for 80 to 84 percent of total respondents’ average product costs.

Retailers’ current response strategies do not appear to directly mitigate such pressures.  Roughly 7 in 10 respondents indicate that their organization’s response strategy is currently focused on enhancing quality assurance programs (71 percent), engaging in advanced planning/scheduling with vendors (70 percent) and enhancing ethical sourcing capabilities (69 percent).
In contrast, retailers are adopting new strategic responses that correspond more closely to the acute cost of pressures reported.  Retailers’ top three emerging strategies include: diversifying their country source of supply footprint (35 percent), re-shoring production to domestic vendors (33 percent), and consolidating vendors (28 percent).

“Re-shoring to local markets is becoming an increasingly attractive option for retailers looking to reduce transportation costs and for products with low labor intensity,” continued Daher.  “For retailers in sub-sectors such as apparel, which tend to have the most vendor fragmentation, cost pressures may incentivize vendor consolidation – especially when retailers desire to improve their leverage to negotiate lower costs, manage smaller order sizes and execute faster production cycles.”

Outsourcing of retailers’ sourcing activities continues to play a significant role. Virtually every sourcing activity was fully or partially outsourced more than 50 percent of the time, and for activities like raw material and finished goods sourcing, that number rises to more than 60 percent.  Several retailers are disterimediating their supply chain partners by establishing off-shore sourcing offices to “go-direct” to the manufacturers.
Ethical sourcing remains a top priority among retailers: a total of 92 percent of respondents indicate their organizations are either currently enhancing their ethical sourcing capabilities to address sourcing pressures or plan to do so in the future.

Deloitte’s study also found that, among the 94 countries noted as sources of supply, China, Mexico and Canada are the most prevalent.  However, after more than a decade as the undisputed leader as a sourcing and manufacturing base, China’s appreciating currency, economic growth and rising labor costs have begun to impact its dominance in the supply market.  Survey respondents indicate that other Southeast Asian countries – including India, Vietnam, Cambodia and the Philippines – are becoming increasingly attractive sourcing locations, particularly for apparel and softlines.

To download the full report, “Private Label Sourcing: Strategies to Differentiate and Defend,” with detailed survey results and strategies for retailers, visit: www.deloitte.com/us/privatelabelsourcing

About the Survey
The Private Label Sourcing Survey was conducted online by Deloitte and an independent research company throughout 2012 and polled 266 apparel, general merchandise and grocery retailers from 90 countries.