Result: a 90% market share in a massive new channel led to total increased volumes of 500% at an FMCG manufacturer. However, this was an unexpected side effect of an effort to transform the speed of decision making for winning tenders and contracts.
The situation. Tim Richardson, now director and founder of GrowthPath, served in Europe as Financial Controller for the Consumer channel of Philips Lighting. In this role, he led the profitability analysis of Europe-wide tenders to supply branded and private label products to retailers such as Tesco, Carrefour, Auchan, Rewe, B&Q etc. This was frustrating. Volumes of these tenders were large enough to have a significant impact on factory load, so insight into fixed and variable costing was important. As well, packaging requirements were important and highly variable. On top of that, each retailer had different logistics models.