零售商如何在供应商谈判中取得成功

© Oliver WymanGrocery retailers across Europe are facing the highest margin pressure they’ve experiencedin the last 20 years. Supermarket and hypermarket operators have seen hefty declines incommercial margin as consumers trade down their baskets (see here for more) — or, worse,switch their shopping destination to discount formats. Given the largely domestic natureof their business, most retailers are not diversified enough to balance shortfalls in theircore business.This stands in contrast to large fast-moving consumer goods (FMCG) suppliers, many ofwhich are benefiting from a global footprint and presence in a wide variety of channels.While grocery retailer profits strongly benefited from out-of-home restrictions in2021, the following year brought a strong swing back from large retailers to largemanufacturers (see Exhibit 1). And signs are that this trend will only accelerate in 2023.Retailers are eagerly anticipating the annual negotiations for purchasing terms in 2024 torebalance the margin distribution. However, most of the global FMCG brands see room forfurther price increases rather than any reason to cut back. We think that the only chancefor retailers to win back an edge in negotiations is a step-change of their capabilities inhow they approach suppliers.Exhibit 1: Analysis of large European FMCG manufacturers and larger Europeangrocery retailersProfit evolution2019-20221001009398961141171122019202020212022--6.4%5.6%15.8%--2.8%0.6%7.3%18.8%18.7%18.2%19.3%6.1%6.1%7.1%6.5%FMCG ManufacturersRetailRevenueYoYManufacturersEBITDA %margin1RetailManufacturersRetail+23%-1%Source: Oliver Wyman Analysis1. Total EBITDA of included companies relative to total net revenue © Oliver WymanSMALL ASSORTMENT ADJUSTMENT SCENARIOSARE NO LONGER SUFFICIENTConsidering adjustments to the assortment has always been part of the retailer’snegotiation toolkit. This often meant that brand product variants “#5 or #6 — such as“cheesecake-flavored yogurt” or “curry sausage crisps with herbs” — are called intoquestion, or the distribution of B- or C-brand portfolio products was to be limited to only thelargest stores. Such considerations used to have a relevant influence over the negotiationdynamics. Now, however, in more and more categories, many retailers are barely makingthe commercial margin required to offset the total operating cost. As this situation requiresa more radical improvement of purchasing cost, small assortment adjustment scenarios donot support the required negotiation power.Instead, retailers now need to consider more significant assortment adjustments, such asa complete delisting of B- or C-brands, replaced by strengthened private label alternatives.The complete delisting of a brand can support a significant volume boost for the privatelabel alternative, which in turn creates more scale in procurement and thus better margins.The better retailers prepare such replacement or shift scenarios, the more demand powerthey will have in the negotiation rounds. The well-known case of German supermarketcorporation Edeka replacing iconic Heinz Tomato Ketchup with a private label look-alike is anexample of such a bold move.To master such scenarios at scale, retailers will have to step-change their demand andassortment analytics, combining point-of-sale (POS) and customer data insights intostrong predictions on likely demand shifts resulting from assortment variations. We havefound that indicating the expected percentage retention of revenues in case of forcedbrand switches is a powerful starting point for buyers to enter negotiations (see Exhibit 2).Such calculations need to be complemented by analyses on the private label sourcing side.Retailers need to ensure they are prepared for brand-to-private label switching scenarioslike the one mentioned above for Edeka. © Oliver WymanExhibit 2: Illustrative Switching Matrix at brand level — % of brand 1 productsthat switch to brand 2 productsMoistureDry-skinDoveSoft & gentleMitchumSanexRight guardVaseline ic24 hourExpertUltra dryProtect 24RadoxBrand“a”Cann %# ProdsCann %Cann %Cann %Cann %Cann %Cann %Cann %Cann %Cann %Cann %Cann %Cann %Cann %Moisture66%4866%9%6%3%4%2%2%1%2%0%0%0%1%Dry-skin54%3215%54%8%4%4%2%1%2%1%0%0%0%1%Dove51%2115%12%51%4%4%2%1%2%2%1%0%0%1%Soft & gentle46%3017%11%8%46%3%2%2%2%3%0%0%0%1%Mitchum61%2411%7%4%2%61%2%1%1%1%1%0%0%0%Sanex40%2615%12%7%4%6%40%2%3%2%1%0%0%1%Right guard39%2223%10%6%4%5%2%39%2%3%1%0%1%1%Vaseline ic46%1013%13%8%3%4%3%1%46%2%0%0%0%1%24 hour66%2511%5%4%3%2%1%2%1%66%1%0%0%0%Expert30%913%8%5%2%11%2%2%1%3%30%3%0%1%Ultra dry9%814%9%7%2%19%2%2%1%5%15%9%0%1%Protect 245%1231%17%8%6%6%3%6%2%5%1%0%5%1%Radox20%820%15%9%8%5%5%2%3%3%1%0%0%20%Mum46%713%9%8%3%4%1%2%2%4%1%0%0%1%46%Natrel5%625%20%9%8%6%3%3%2%6%0%1%2%2%Triple dry76%55%3%2%1%4%1%1%0%0%1%0%0%0%Bionsen56%58%8%5%1%6%2%1%1%1%1%0%0%0%Source: Oliver Wyman AnalysisNote: Cann = CannibalizationSHOULD-COST MODELING ON A PRODUCT LEVELIS NO LONGER A “NICE-TO-HAVE“Aside from the assortment issues, the interpre