There have been many discussions and articles debating how the ‘special relationship’ between manufacturer and retailer must evolve. In a time when the leadership teams in both hold some of the industry’s top talent, many of us are wondering what we can hope to see in the near future?
However, there is a feeling that the industry is in ’lockdown’; retailers and manufacturers are playing it safe and who can blame them when consumer trust is at its lowest? True innovation is limited and the weekly food shop has become very formulaic. It can hardly be described as ‘fun’ but with margins being eroded for both parties neither the retailer nor manufacturer has the investment required to create fresh and exciting ‘in-store experience’ on the scale that is required.
Plus, discounters continue to grow and communicate effectively with consumers - Aldi and Lidl having a combined market share of over 10% which has doubled in just three years. Almost one in two shoppers visit a discounter every four weeks, as the top four struggle to maintain profit margins whilst attempting to compete with the pricing tactics of the discounters.
So maybe the time has come for manufacturers to reassess; to review their definition of category management? Decide where to sell their brands and which retail partnerships to invest with for the future? Innovate to create value and real category growth for their consumers and customers? Whatever the decision, leaders have tough choices to make!
Alka Gandhi is a Principal Consultant at Berwick Partners and specialises in recruiting senior managers and leadership roles across the Consumer sector.