Factors that influence ranging with grocery retailers

 In Australia, NewZealand

We in New Zealand like to believe we have the most unique grocery trade environment in the world or at least in the developed world. Yes it is unique to some extent with the Foodstuffs North Island model, but nothing that can’t be overcome with some insightful strategies, having the right field sales team and a relevant commercial offer. There are a number of practical factors to consider when attempting to gain ranging with grocery retailers.As is expected a number of these factors are common across most developed markets, but we are unique. Needless to say different variables of different factors influence outcomes
Margin: This is critical as most retailers net profit margins are half and below of most FMCG manufacturers. Looking at it globally P&G for FY 14 had a net profit margin of 14.1{845d44a2f09c0018d802e19e78941a85dc2180e4ed7410cee0b34e8cb134ecea} while Walmart was at 5.7{845d44a2f09c0018d802e19e78941a85dc2180e4ed7410cee0b34e8cb134ecea}. Yes they are different businesses, but retailers have limited room to move in terms of margin when compared to manufacturers. Therefore, having your products offer above category average margin ticks the first box.   FMCG Consulting (NZ) – Read more…

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