The Consumer Packaged Goods (CPG) Industry and Solution Providers
By Jay R. Jeffreys, PE; Director, Wonderware Solution Provider Programs
Table of Contents 1. The CPG Industry ................................................................................................................................... 3 2. Industry Comparisons ........................................................................................................................... 4 3. What CPG Companies Need from Solution Providers ................................................................ 5
The Consumer Packaged Goods (CPG) Industry and Solution Providers
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1.
The CPG Industry
The Wonderware Solution Provider Program currently
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The non-cyclical category includes beverages, tobacco, personal products, office supplies and food items. The Industry Browser information tools at the Yahoo! Finance Industry Center (biz.yahoo.com/p/3conameu.html) may surprise you in terms of the relative sizes and profitability of some segments in the Consumer Goods categories. For instance, the top five segments by market capitalization are as follows:
The Consumer Packaged Goods (CPG) Industry and Solution Providers
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Segment Auto manufacturers Food – major diversified Cigarettes Beverages – soft drinks Cleaning products
Market Capitalization ($B) 296 281 269 266 205
The largest segments are not necessarily the most profitable, however. The top five segments by overall profit margin are: Segment Cigarettes Cleaning products Beverages – brewers Beverages – soft drinks Confectioners Net Profit Margin (%) 17 13 12 11 10
Somewhat surprisingly, the largest segment by market capitalization – Auto Manufacturers – is one of the least profitable at just 1.8%. The sizable and highly visible – but keenly competitive – Electronic Equipment category is squeezed down to just 2.5% overall net margin.
3.
What CPG Companies Need from Solution Providers
For our Consumer Packaged Goods customers to succeed, they must deal with a number of internal and external pressures and demands. Those internal drivers include: Protecting or increasing profits
industry covers services and platforms with a vast variety of focal markets. The portion of the
The company was recently presented an opportunity by its largest retail customer to significantly increase its share in their private label manufacturing. The prospect of growth was risky, since it
Kerin, R. A., Hartley, S. W., & Rudelius, W. (2013). Marketing. (11th ed.). New York, New
The top four; Deer Company, CNH industry, AGCO Corporation and Caterpillar are generating half of all revenues in the same industry.
In this report I will be comparing methods used by two different retailers on how they distribute two chosen products, of my choice, in two different retailing sectors. Seeing as the food and clothing sector both have very different styles of how they meet their product requirements, I will compare Tesco and JD; The products from these two companies itself that I’m going to compare is ‘Tesco Value Bread’ and Nike hoodies.
CompuCo is attempting to move from a domestic producer to that of an international producer. In order to achieve this feat, the company must have an international focus in regards to its overall business operations. It is quite apparent from the case, that CompuCo does not have the will or desire to be proactive with its international subsidiaries. In order to achieve greater international success, Dr. Durand must first alter the company culture. First, all international subsidiaries should be treated as a primary business irrespective of their individual performance. It seems, through reading the case, that much more emphasis is placed on French product development and applications that is given to its international counterparts. This is a detriment to business as many of CompuCo's international customers have differing tastes and sentiments in regards to product offerings. The case cites numerous examples of this between both French and American consumers. French consumers, for example, like to read product manuals and prefer complexity over simplicity. Their American counterparts however prefer ease of use, and a simple design. The company was slow to discern these changes in consumer demands and elected instead to emphasize its French product design. This created consumer ill-will and
In terms of industry profitability, it appears that profit margins have a tendency to fall. This is because competition is high and customers tend to buy low-priced high-value items. The average gross margin and net profit margin is 37.1% and 14.3%, respectively (MSN Money, 2010).
Defining the industry: Both concentrate producers (CP) and bottlers are profitable. These two parts of the
CGC had to be on the leading edge of the latest technology and also exceed the customer’s expectations. Research and development was a critical part of its success and future success that CGC had to place major focus on. They had to maintain their market edge plus solidify their hold as the market leader by consistently releasing new models that differentiated it from competitor’s products and CGC’s own products as well. If a product stayed in the market too long, the sales would eventually peak and then start a downward trend, so getting out at the peak is the key.
As marketing manager of the RBG business, Ivan Guillen must propose a solution to repair Pillsbury refrigerated baked goods (RGB)’s business performance. Since the refrigerated-cookie product line consisted of 62% of RBG’s unit sales and over 75% of the company’s profits, Guillen found it appropriate to alter this segment in the market. Proposing this idea to GMCC would require Guillen to consider all the challenges he faces. Guillen will have to discover a strategy to increase household penetration since it has fallen to 24% in the past few years. The lack in market penetration has
The Net Profit Margin in 2012 was 10.5% while in 2013 it was 66.6%. This increase in the Net Profit Margin can be attributed to the increase in net profits after taxes despite the fact that there was a slight decrease in revenues.
Media Networks: This segment includes cable and broadcast television networks, television production and distribution, domestic television stations, and radio networks and stations. It is the largest segment, contributing 44% to revenue, and 53% to operating profit.
P&G is an international supplier of consumer goods it is a "global leader in health and beauty care products, detergents, diapers and food . P&G's presence in the hair care market in the U.S has been strengthened by innovative technology BC-18 and the replacement of an old brand 'Pert' with 'Pert Plus'- a mild shampoo with a fully effective conditioner. P"G decided to introduce BC-18 in Europe. Traditionally, the European market is highly competitive the main rivals are Colgate, Unileaver, and L'Oreal. The European market is segmented (i.e. value based) and
– Current market situation: detailed consumer and business market segmentation and analysis of market drivers will be undertaken to identify the most valuable
Consumer behaviour is complex and a company has to fit their product more closely and satisfy their customer needs more fully than the