Building a Sustainable Business Growth Strategy
Whether it is a sustained recovery of UK consumer confidence or a false dawn, the last 5 years has taught us to expect the unexpected and consider multiple options in our trading plans as suppliers.
Anyone reading the international, national or trade press at the moment can be forgiven for not knowing if their plans for the next 12 months are going to be enough to motivate shoppers or not. Trying to commit to a volume and profit ratio isn’t going to be any easier for 2025 than it has been since the UK locked down in March 2020.
On the positive side of things, the new GFK Consumer Confidence Index shows a steady improvement from September 2022 to July 2024. Asda’s Income Tracker shows a 13% increase in average household disposable income. So, your 2025 plans with strong volume growth should be all good hey!?
Quite possibly not. At Sellex, we believe that when discretionary goods demand is soft (there’s only so much you can put the current softness of demand down to people voting to attend Taylor Swift concerts instead of buying a new barbeque!) and there is the level of geopolitical uncertainty in the World (is the US economy heading for recession? – who knows!) it is prudent to go about your Category, Channel and Customer Planning in an equally rigorous and pessimistic way.
We still see so many plans built on a “this year plus a bit” mentality. I was recently reflecting on the nature of innovation with a highly respected Commercial Director within the Food and Drink Industry on the definition of innovation. So many people focus on new product innovation when there are so many levers that can be looked at in their existing businesses where a significant bottom-line improvement can be achieved. Innovation in ways of working can bear significant fruit and we feel that many organisations are still not adapting their ways of working to maximise sales and profitability.
Some questions to ponder (8 in total in true Sellex style!):
- Are your Customer Development team structures pointed at growth customers? Are you over or under-servicing customers? How are other businesses changing the structures of their teams?
- How "data rich" yet "insight poor" is your Customer Development team? We see only 5% of organisations using the full power of the data available to them – you don’t need additional software providers, just a great set of working principles
- How serious are your retail customers about making Retail Media a partnership, helping you to secure the very best volume driving opportunities in exchange for supporting a key strategic (and profit) lever for retailers?
- Is your Category Vision/Strategy fit for purpose in an environment where Brands are looking to reset the balance versus Private Label? – how close are you to shoppers in your specific category?
- We see Field Sales investments increasing dramatically right now – has it worked for you, how do you know what could have been achieved without it or by using more precise execution methods?
- Are your planning processes set up to quickly spot and respond to changing dynamics in the market? – with promotional frequency and depth already bumping up against retailer rules around price establishment – if you can’t promote more often, how are you going to ensure your promotions are maximised?
- How Commercially Confident are your teams in leveraging cross-functional relationships, with so many now stuck in 5 years of talking inflation/deflation?
- Are your trade terms still fit for purpose when additional promotional activity is the last thing your buyer wants to talk to you about ?– what are the levers that create joint value that can spice up the conversation?
Sellex exists to co-create Business Growth Strategies with clients. We want to inspire Commercial Confidence amongst Commercial Directors and Account Executive alike.
To learn how Sellex can help you. please contact us at info@sellex.co.uk.
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