Kom klinic 2012 finala
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Speed: The Consumer is Changing Faster than the Food Industry can change

Speed: The Consumer is Changing Faster than the Food Industry can change

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Kom klinic 2012 finala Presentation Transcript

  • 1. Speed: The Consumer is Changing Faster than the Food Industry can change Richard Kochersperger Summer 2012 1
  • 2. Industry Gurus 2
  • 3. Tell Me and I ForgetTeach Me and I Remember Involve me and I Learn Ben Franklin 3
  • 4. 4
  • 5. 5
  • 6. Goals/Objectives• Reality Check: An American Economic Perspective• View of the Food Industry: Retail/Foodservice Competitive Landscape? – Winners and Losers – Impact Players – New Developments• Speed: Key Issues and Opportunities 6
  • 7. Reality Check
  • 8. Federal Spending 8
  • 9. Reality CheckAmerican Employment??? 8.2• Available Workforce: 155 million• Unemployed/underemployed: 29.7 million• Real Rate: 19%• Rutgers Study: 2006-2011 – 27% of the graduating students have full time jobs – 33% are unemployed• The median family income dropped 39% since 2007 9
  • 10. Reality Check
  • 11. Reality Check 11
  • 12. Reality Check• 1 in 7 Americans; 1/10 Canadians are challenged to feed themselves• 2 Billion people worldwide do not have enough food to eat!• 40% of global food resources are wasted – Not harvested – Spoils – Thrown away 12
  • 13. The “Have” and “Have Nots”
  • 14. Food Inflation6.6% 14
  • 15. Industry Performance• Whole Foods: 9.5% • Wal-Mart:• Fresh Market 8.2% 2.6%• Costco 7.1% • Safeway: 1.0%• Dollar Tree 5.6% • Weis Markets: 0.9%• Target: 5.3% • Delhaize: Food• Food Inflation 5.2% Lion/Hannaford: 0.6% • Ingles: 0.1%• Publix: 4.2%• • Tops: 1.8% Fresh and Easy: 3.6% • Roundy’s: 2.1%• Ahold: 2.9% • Supervalu: 5.1% 15
  • 16. Closing ThoughtExcellence is not a skill.It is an attitude.~Ralph Marston 16
  • 17. 10 Food Companies Dominate 17
  • 18. Food Retail Industry Graveyard 18
  • 19. Food Retail Industry Graveyard 19
  • 20. Food Industry E R 20
  • 21. Food Industry E R 21
  • 22. Food Industry Winners 22
  • 23. Foodservice Industry Winners 23
  • 24. Big Moves• Target goes to Canada: 130+ stores; rolls out P- fresh format across the US: 436/200+• Wegman’s moves into Boston/King of Prussia• 7-11 Targets the Big Apple• Wawa goes South to Florida• Agro Trade shows up in Miami• America runs on Dunkin’• Family Dollar opens 500 new stores; Partners with McLane• Supervalu to Close Ohio DC 24
  • 25. Big Moves• Shop Rite grows in Baltimore• Harris-Teeter moves into Washington DC• Bottom Dollar to Eastern Ohio• Spartan intros Valuland• Aldi comes to Houston• Price Chopper Limited• Fresh Market opens in California• Couche-Tard acquires Statoil Fuel & Retail• Dollar General: 625 stores/40 DG Market• PFG buy Institutional Food House• US Food buys New City Packing 25
  • 26. Consumer Reports 2012• 33% changed primary • Wegmans 88 store • Trader Joe’s 86• 43% looking for lower • Publix 85 prices • Fareway 84• 25% poor selection, long • Costco 83 lines• 17% employee rudeness • Harris Teeter 83• Not enough checkouts • Raley’s 82 • Hy Vee 82 • Stater Bros 81 • Winco 81 • Whole Foods 81 26
  • 27. 2011 Retail Market Share Number of Dollar Share Annual Millions StoresTraditional Grocery 40,333 46.8% $480,138Total C Stores 152,513 15.4% $158,546Total Non Traditional 54,325 37.8% $387,529GroceryDollar Stores 23,418 2.1% $21,492Total All Formats 247,081 100% $1,026,215 Future of Food Retailing, 2011 Willard Bishop 27
  • 28. Future Growth 28
  • 29. Food Service Marketplace 29
  • 30. Closing Thought• FMI2012: Supermarkets Must Adapt to Stunning Changes, Sarasin Says• The store as we have known it for the last half a century is being redefined.• "No one is safe from the vicissitudes of change that continually rock this industry, in which technological earthquakes alter the landscape daily and sometimes even hourly.“ 30
  • 31. Amazon.com• Sales: $48 Billion • More e-books than• 55% North America hardcover and• 45% International paperback• Profits: $862 million • Wide variety of products: clothing,• Inventory Turnover shoes, sporting 11/33 days goods, FOOD!• Accounts Payable 72 days 31
  • 32. Amazon Supply 32
  • 33. Amazon Supply 33
  • 34. Amazon: My Habit 34
  • 35. 35
  • 36. 36
  • 37. Amazon: Zappos 37
  • 38. Amazon Quidsi 38
  • 39. Amazon: Kiva 39
  • 40. 2015: 3 largest in the World rd 40
  • 41. Continuous Innovation, 2020+
  • 42. World’s Largest E-Commerce Co 42
  • 43. • Walmart serves customers more than 200 million times per week at more than 10,231 retail units in 27 countries through 69 banners• WalMart employs 2.2 million associates globally, including almost 1.4 million in the United States.• Walmart is one of the largest private employers in the U.S., the largest in Mexico and one of the largest in Canada as well. 43
  • 44. Wal-Mart Financials 44
  • 45. Supercenter Source of Volume 13% Other Each new Walmart Supercenter Mass averages $1.7million in sales per week 33% 32% (roughly $900,000 in supermarket item All Grocery volume). Other Chains 22% If Walmart takes 5% to 7% of the $710 Walmart billion grocery industry in 2012, Walmart Discount will add $35 - $50 billion Stores Over 75% of Walmart Supercenter volume is being captured from retailers in other major channels. Source: A.C. Nielsen Channel Service 45
  • 46. 46
  • 47. 69 different bannersthrough out the World 47
  • 48. Wal-Mart GrowthFormat Actual Projected Projected 2012 2013Large >60,000 153* 120 130Format sq.ft.Medium/ <60,000 1 30 90Small sq.ft.Sam’s Club 9 9 15Total 163 159 235*43 remodels to Supercenters 48
  • 49. Walmart Innovations• Experimenting with grocery home delivery – San Jose, San Francisco, Chicago.• Introduced ‘Goodies’ – Subscription service for new products not carried in inventory 49
  • 50. Farmers Markets2011: 7,175 50
  • 51. Target • 462/200 stores P Fresh • 5% Redcards Rewards • Move into Canada • City Target: Chicago, NY, Seattle, SF, LA • Shopping on the GO • 5% of profits to back to communities 51
  • 52. Target Move to Food 52
  • 53. Which Food Store? 53
  • 54. Walgreens 54
  • 55. Walgreens 55
  • 56. Walgreens 56
  • 57. Trader Joe’s• 370 stores• $8.5 Billion sales• 4,000 sku’s• $1750 sales/per sq foot• Eclectic mix/Treasure Hunt• Hawaiian Shirts• Great Customer Service 57
  • 58. 58
  • 59. Dollar Stores 59
  • 60. Tesco 60
  • 61. Tesco Lost $1.2 billion 61
  • 62. Wegmans 62
  • 63. When thereIs no vision, the peopleperish! 63
  • 64. The Consumer Drivesthe Food Supply Chain 64
  • 65. Customer’s Perspective• Anytime: 24/7/365• Any Place: Format• Anywhere: geography• My Way! 65
  • 66. Future Food Shopping 66
  • 67. Self Checkout 67
  • 68. Scan-Bag-Go! 68
  • 69. Scan IT! 69
  • 70. Robot Shopping 70
  • 71. Next Generation of ShoppingTry on clothes in 3D, share photos with friends, and store wish-listed items on smart phones 71
  • 72. Next Generation of Shopping 72
  • 73. QR Quick Response BarcodeA QR code (abbreviation for Quick Responsecode) is a specific matrix barcode (or two-dimensional code) that is readable bydedicated QR barcode readers and cameraphones. 73
  • 74. Virtual Stores 74
  • 75. Automatic Shelf ReplenishmentEdeka/Witron:Germany 75
  • 76. Drive Through: Europe 76
  • 77. Drive Through: Auchan 77
  • 78. Food Comes to U! 78
  • 79. Everyone wants a piece of your business! 79
  • 80. Substitution: Big Box for Small Digital for Both 80
  • 81. Evolution of E/M/F Commerce 81
  • 82. E/M/F Commerce 82
  • 83. Evolving Marketplace 83
  • 84. E Commerce: Segmented 84
  • 85. Free Shipping: E Commerce 85
  • 86. % of Total Category Sales Online 86
  • 87. On Line Food Sales 87
  • 88. Social Media 88
  • 89. Social Media 89
  • 90. Mobile EcommerceSocial media marketing is going to blow the shinglesoff the roof once people really figure out how to useit Megan O’Connor, Levi Strauss 90
  • 91. Mobile Ecommerce• Mobile Stats:• 5.9 Billion subscribers• 8 Trillion SMS messages sent in 2011• 11+ Billion apps downloaded, 1 in 4 never used again• The number of mobile searches quadrupled in the last year• 8.49% of global web site hits come from mobile 91
  • 92. FCommerce 92
  • 93. F Commerce 93
  • 94. Ipad/Tablet Changes the World 94
  • 95. Future Connectivityhttp://www.youtube.com/v/uIzNmVMOYm0&fs=1&source=uds&autoplay=1 95
  • 96. Key Observation• “Insanity: doing the same thing over and over again and expecting different results.” Albert Einstein 96
  • 97. Complexity
  • 98. 98
  • 99. Food Logistics Issues• Shortage of Human Resources• Energy• Environmental/Sustainability• Technology• Urbanization• Ethnic Demographics• Speed: the ability to react to make decisions, quicker, faster, more effectively than your competition! 99
  • 100. Work Force Shortage 100
  • 101. Driver Shortage• Estimates: As high as 400,000 by 2015• Government regulations will eliminate at least 5% of the drivers• Increase in freight rates at 5%/yr for inbound products• Increase in inventories to prevent outs due to shortage of drivers• Outsourcing will not solve the problem! 101
  • 102. DC: Automation Take Fingerprints off the Box! 102
  • 103. Transportation• Improve driver performance through education and training• Intermodal/Rail• Collaboration/Consolid ation• DSD strategy• Customer Incentives 103
  • 104. Energy 104
  • 105. Energy 105
  • 106. Alternative Fuels Natural GasElectric 106
  • 107. Green Supply Chains 107
  • 108. Smart Way Transportation• Aerodynamics• Super Singles• Auto Tire Inflation• Low Viscosity Lube• Hybrid Power• Automatic Transmission 108
  • 109. Technology 109
  • 110. Expanded Bar Codes 110
  • 111. Temperature Sensors 111
  • 112. RF-ID Alive and well!! Developments: – Eliminate the check out process at the store – Improve inventory management – Reduce mistakes unloading products inbound/outbound – Monitor temperatures throughout supply chain – Minimize paperwork 112
  • 113. Control Towers• Proctor/Gamble, Sysco, Walmart, Supervalu• Centralized Traffic and Transportation• Incorporates sophisticated software to analyze/see all routes/equipment; inbound and outbound• Optimize entire supply chain: Visibility and Control• National Bids• Convert to customer pick up• Full Trucks/Balance workload 113
  • 114. Satellite CommunicationsV to V: Cars, Trucks,Airplanes, Trains 114
  • 115. NanotechnologyContamination Sensors Pesticide ReductionAnti microbial Packaging Tracking, Tracing, Brand ProtectionImproved Food Storage TextureEnhanced Nutrient Delivery FlavorGreen Packaging Bacteria Identification and Elimination 115
  • 116. Urbanization 116
  • 117. Urbanization • Traffic • Smaller Stores/Trucks • Road Restrictions • Parking • Noise Levels • No Docks • Security • Congestion 117
  • 118. Urbanization 118
  • 119. U. S. Demographics 119
  • 120. U. S. Demographics 120
  • 121. Rise of the Ethnic Focused Retailer 121
  • 122. Speed: The Consumer is Changing Faster than the Food Industry can change 122
  • 123. Future FCPG Industry Supply ChainCommand Center InformationControl Tower Retailers ??????Strategic Hub Information The Consumer Information Suppliers Distributors Third Party Manufacturing Alliances, Network Partners Regional, global plants Bulk, Semi-finished, Information Filling Finishing, Information 123
  • 124. Closing Thought• It’s not the strongest companies that survive, nor the most intelligent, but the ones most responsive to change! 124