Food Suppliers Squeezed As Recovering Supermarkets Push To Remain Competitive

Latest news of cost-increase resistance by buyers raise the following issues for NAMs:

Where at: Surprise, surprise! Whilst pragmatic NAMs do not expect retail buyers to roll over and accept cost-price increases, some state of equilibrium will be required to minimise supplier concentration and less choice…

Where headed: …if fewer, more powerful suppliers emerge in the coming months

Effect on you: Smaller players in niche categories can survive by optimising their (realistic) place in the market

Action: Time to revisit fundamentals of real consumer demand vs. available alternatives to define core proposition. Then numbers, numbers, numbers to calculate cost and value and build a financial rationale

Alternative use of redundant retail space?

    King's Mall, Hammersmith

Disappointing Results for Discounters whilst Tesco and Morrisons Continue their Recovery

Latest News of Christmas trading raise the following implications for NAMs:

Where at: The combination of intense price-warfare and consumer expectation ‘that 2017 will be more expensive’ gave a boost to most Christmas sales, while suppliers and retailers absorbed pent-up cost-price increases

Where headed: Q1 will reflect real world conditions in terms of price increases i.e. a re-set in relative performance where historical performance counts less..

Effect on you: Opportunities for pro-active NAMs while competitors await trends and perhaps an expectation of a return to normal

Action: Why not assume that you are re-launching everything in Q1 and re-assess your relative competitive appeal on that basis?

2017: When more is required, NamNews can help...

M&S Agrees To Grocery Price Rises Following Supplier Threats

Marks & Spencer has reportedly accepted wholesale price rises of up to 15% on some of its grocery lines after suppliers threatened to withdraw their products.

Where at: Clearly at the limits of supplier & retailer cost absorption, with ‘public’ announcements best left to the post-agreement stage

Where headed: Some face-saving rationalisation, knowing that scale savings rarely transfer directly into significant reductions in cost of production

Effect on you: opportunity for NAMs in other customers to watch from the ringside, and learn from premature moves

Action: Stick to defensible price increases based on latest analysis of competitor and customer financials…

2017: A year of political tweaking?

2017: a year for multi-tasking?

When Almost Right is not enough...