Advice for CEOs

A combination of the recovery of the U.S. economy, low interest rates and inflation, and the introduction of new products in the marketplace are all driving consumer product sales — but not for every business. In order to improve consumer products profitability and gain a competitive advantage, there are several components and strategies your business must follow.

In the first and second parts of this article, I discussed aspects of a successful strategy to improve profitability for a consumer products company: a strategic approach that integrates sourcing, distribution and retail, combined with intensive collaboration across your departments and with retailers. In this final part, I discuss the next step in building a successful strategy: finding the right balance between the retail and on-line channel.

In the first part of this article, I described the first step to implementing a successful strategy to improve profitability for a consumer products company, whether generic or branded: an approach that integrates sourcing, distribution and retail. In this part, I discuss the step two for improving profitability: coordinating between the different departments of your company and with your supply chain partners, especially retailers.

The rate of change in today’s business environment is faster than it has ever been - and getting faster. Years of experience as a CEO of consumer product companies selling to retailers and consumers have taught me that even very strong demand for your product is not nearly enough. The pressures of today’s market mean that, no matter how good a product or service you are selling, a strategy to improve profitability in customer package goods must have three components: a well-defined product strategy; a highly coordinated process across the supply chain that optimizes the product’s value and attractiveness to the end consumer; and the right balance between bricks and mortar and on-line retailing.