Challenges for retail and consumer product companies are many in today's business environment as a confluence of market forces have created an extremely difficult climate.
In mature markets, Retail sector companies are constrained in their ability to grow and maintain profit margins as a result of a deflationary operating environment, market saturation, slowing population growth, and more discerning but less loyal consumers. There are also the immediate concerns of growing competitive pressures, an increase in the number of alternative sales channels, a blurring of roles between suppliers and retailers, and particularly for consumer product manufacturers a shift in the balance of power to the retailers.
As a consequence, the strategic focus of the sector is moving towards the emerging economies and expanding consumer markets of Asia and Central & Eastern Europe, China and India in particular which offer new opportunities for growth through global sourcing, off-shoring and the development of modern retailing.
In addition, due to stakeholder demands and the resultant Sarbanes-Oxley legislation, the retail & consumer industry is also experiencing heightened regulatory pressures. These imply greater accountability and accuracy in the reporting of financial results under IFRS and US GAAP, increased levels of corporate governance and Board involvement, stronger internal control documentation and a greater need for stronger risk management practices across the enterprise.
Retail & consumer industry challenges
Market value recognition
Corporate/Brand reputation and corporate social responsibility
Supply chain optimization
Influence of new technology
Brand valuation and management
Enterprise risk management