Dear Retailer
Why not keep our little mistakes secret by eliminating 'shout-over' and confining our dialogue to the check-out screen?
Have a User-friendly weekend from the NamNews Team!
Friday 31 July 2015
"Unexpected Item in the Bagging-Area"
Dear Retailer
Why not keep our little mistakes secret by eliminating 'shout-over' and confining our dialogue to the check-out screen?
Have a User-friendly weekend from the NamNews Team!
Tuesday 28 July 2015
A step beyond GSCOP?
Whilst the issue of supplier-retailer trading relationships has become ‘Agenda: Upper Quartile’, and the Code of Practice, in practice, is now being seriously considered by key stakeholders, it could be that suppliers are not raising their sights and expectations to a place that was always the aim of GSCOP, in spirit rather than by the letter of the Code.
Whilst it is obviously important for all parties to understand the detail and practical application of GSCOP, it is important to keep in mind that focusing on the ‘letter’ of the code in legal terms will at best slow down the evolution of what could, and should, be a basis for improved day-to-day dealings between suppliers and retailers.
Meanwhile, there is little point in criticising retailers’ legal departments for helping buyers to avoid falling foul of the letter of the ‘legislation’, that is what corporate lawyers do…. And besides, retailers need, and can afford to employ the best talent available in finding a way forward, especially in unprecedented times…
In fact, should the GCA team ever find themselves in a position to levy a fine of 1% of a retailer’s turnover, they will find themselves opposite a/the best-in-class legal team, entirely focused on provable ‘letter-of-law’ breaches, with the spirit-of-law aspects playing little, if any, part in the process.
The answer for suppliers has to be a company-wide emphasis on evolving a sustainable offer that represents a demonstrable edge over available alternatives, an advantage that is not easily replicated by the competition. In practice, this could mean a supplier has to construct their own portfolio re-set, stripping out any brand/SKU that fails to reach this standard, and live with the consequences.., before Tesco does it on their behalf.
This should be followed by re-negotiation of your existing supplier-retailer relationship to a point beyond GSCOP, a fair-play arrangement where each party’s reward is proportional to relative risk, and the partners collaborate because they want to be in business together, in the full spirit of a mutually productive working relationship…
Over-idealistic, naïve even?
Would you prefer having to refer to a lawyer’s ‘letter’ for every stroke, and a life where you best energies are wasted on second-guessing your ‘opponents’ on the other side of the buyer’s desk?
There is a better way...
Whilst it is obviously important for all parties to understand the detail and practical application of GSCOP, it is important to keep in mind that focusing on the ‘letter’ of the code in legal terms will at best slow down the evolution of what could, and should, be a basis for improved day-to-day dealings between suppliers and retailers.
Meanwhile, there is little point in criticising retailers’ legal departments for helping buyers to avoid falling foul of the letter of the ‘legislation’, that is what corporate lawyers do…. And besides, retailers need, and can afford to employ the best talent available in finding a way forward, especially in unprecedented times…
In fact, should the GCA team ever find themselves in a position to levy a fine of 1% of a retailer’s turnover, they will find themselves opposite a/the best-in-class legal team, entirely focused on provable ‘letter-of-law’ breaches, with the spirit-of-law aspects playing little, if any, part in the process.
The answer for suppliers has to be a company-wide emphasis on evolving a sustainable offer that represents a demonstrable edge over available alternatives, an advantage that is not easily replicated by the competition. In practice, this could mean a supplier has to construct their own portfolio re-set, stripping out any brand/SKU that fails to reach this standard, and live with the consequences.., before Tesco does it on their behalf.
This should be followed by re-negotiation of your existing supplier-retailer relationship to a point beyond GSCOP, a fair-play arrangement where each party’s reward is proportional to relative risk, and the partners collaborate because they want to be in business together, in the full spirit of a mutually productive working relationship…
Over-idealistic, naïve even?
Would you prefer having to refer to a lawyer’s ‘letter’ for every stroke, and a life where you best energies are wasted on second-guessing your ‘opponents’ on the other side of the buyer’s desk?
There is a better way...
Monday 27 July 2015
Ikea has created the kitchen of 2025 — and there's no stove or refrigerator
The article gives an overview and pics here, but if you really want to dig into the detail and methodology, best check the Concept Kitchen site.
This give details of
- Smart shelves with induction cooling replacing refrigerators
- Smart table with hidden induction coils to heat pots & pans, replacing the cooker
- Smart waste disposal to aid recycling
Over the top?
Perhaps, but what it could mean is more savvy buying and significantly less waste...
Add to this the increasing tendency for major grocery retailers to expand vertically into food processing to restore profitability, effectively withdrawing demand from the market.
In other words, branded food suppliers have ten years to anticipate and adapt to supply chain dreams that are fast becoming reality...
Why not try a what-if to explore how your encounters with the buyer will reflect the above developments in the coming years?
Sunday 26 July 2015
Friday 24 July 2015
Amazon's Profit - a rounding error for Apple but proof of potential for the Stock Market
Amazon’s surprise second quarter profit of $92m, on revenue of $23.19Bn, a net margin of only 0.39% clearly leads the stock market to believe that the company is beginning to flex its latent profit muscles, adding $40bn to their market capitalisation, making them bigger than Walmart…
Reports in the New York Times confirm Amazon’s unchanging formula:
It is the leading e-commerce company, and e-commerce is going to be really big. Its dominant position will allow it to undercut competition and bring home large profits. In the most extreme case, it will control the delivery pipeline of goods into homes, kind of the way cable companies once controlled the flow of entertainment...
The stock market have obviously bought into the Amazon profit story, allowing the company to provide steady but minimal profits, re-investing surplus in innovations and experiments that normal companies can only dream about…
…Allowing Starship Amazon to continue on its mission of selling anything to anyone, anywhere, anytime, in whatever way they want to buy, forever?
BTW, in case you ever need reminding of their scale, Amazon have just opened a new multi-million pound fashion photography studio in London's Shoreditch as its fashion business continues to grow, and will produce half a million fashion images a year.
At 46,000 square feet (Asda-size), it houses 22 individual photography bays, a large state of the art editorial suite, video editing facilities, a creative fashion library, and office space for Amazon’s growing team of fashion creatives.
Please continue to watch this space...
Reports in the New York Times confirm Amazon’s unchanging formula:
It is the leading e-commerce company, and e-commerce is going to be really big. Its dominant position will allow it to undercut competition and bring home large profits. In the most extreme case, it will control the delivery pipeline of goods into homes, kind of the way cable companies once controlled the flow of entertainment...
The stock market have obviously bought into the Amazon profit story, allowing the company to provide steady but minimal profits, re-investing surplus in innovations and experiments that normal companies can only dream about…
…Allowing Starship Amazon to continue on its mission of selling anything to anyone, anywhere, anytime, in whatever way they want to buy, forever?
BTW, in case you ever need reminding of their scale, Amazon have just opened a new multi-million pound fashion photography studio in London's Shoreditch as its fashion business continues to grow, and will produce half a million fashion images a year.
At 46,000 square feet (Asda-size), it houses 22 individual photography bays, a large state of the art editorial suite, video editing facilities, a creative fashion library, and office space for Amazon’s growing team of fashion creatives.
Please continue to watch this space...
Tuesday 21 July 2015
NASA-funded study envisages a permanent Moon base within 20 years
According to Science Alert, a new economic assessment into the feasibilities of an ‘Evolvable Lunar Architecture’ base suggests that humans would be able to return to the Moon for approximately 90 percent less cost than previous estimates, which ran up to US$100 billion.
The new low-cost strategy would be possible due to leveraging partnerships with the private sector, and predicts that the US could lead an ‘International Lunar Authority’ comprising both public and corporate interests.
Time to begin to factor a re-born Tesco into your trade strategies, while others await a possible turnaround?
Monday 20 July 2015
Supermarket price wars fall-out: Food companies across the UK 'on brink'
A report by Begbies Traynor in NamNews says the number of food and drink manufacturers in ‘significant’ financial distress has risen by 54% in the past 12 months to 1,622, 89% of which are small or medium-sized suppliers and farmers dealing with the major supermarkets.
Given that branded goods suppliers need Net Margins of 5-10% to fund brand equity building, and - depending on category - stock rotation of 5-20 times per annum to meet availability KPIs, ROCE performances of 15 -25% to ensure an adequate reward for risk - and thus some local autonomy - it is fairly easy to assess the scale of the fall-out in your categories...
The key issue for suppliers is their own performance vs other companies in their categories.
In other words, check your company's UK figures at Companies House, for 2007 and the latest available - usually 2014 for most companies - allowing for issues re Corporation Tax (i.e. your company tax domicile arrangements can colour the reported performance at local level) but in general the figures will be usable for most companies in your category, especially in food.
Action:
Unless of course you prefer to believe the politicians and fly blind?
Given that branded goods suppliers need Net Margins of 5-10% to fund brand equity building, and - depending on category - stock rotation of 5-20 times per annum to meet availability KPIs, ROCE performances of 15 -25% to ensure an adequate reward for risk - and thus some local autonomy - it is fairly easy to assess the scale of the fall-out in your categories...
The key issue for suppliers is their own performance vs other companies in their categories.
In other words, check your company's UK figures at Companies House, for 2007 and the latest available - usually 2014 for most companies - allowing for issues re Corporation Tax (i.e. your company tax domicile arrangements can colour the reported performance at local level) but in general the figures will be usable for most companies in your category, especially in food.
Action:
- Check your own figures, 2007 & 2014
- Check three competitors on the same basis
- Assess relative strengths and weaknesses i.e. the relative damage done to date, the ability to continue funding price-cuts and especially the competitors' ability to compete in your category
- ...keeping in mind that the buyer is equally capable of investing a £1 per set of results, from the same source...
Unless of course you prefer to believe the politicians and fly blind?
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