Speakers:
Neil Austin – Global Head of Markets, KPMG in the UK
Willy Kruh – Global Chairman – Consumer Markets, KPMG in Canada
Pat Dolan – Head of Consumer Markets, KPMG in the US
Archie van Beuren – Former Chief Customer Officer, Campbell Soup Company, US Nick Debnam – Head of Consumer Markets – Asia Pacific Region, KPMG in China
George Svinos – Head of Retail – Asia Pacific Region, KPMG in Australia
Ian Pye – Former President, Central Food Retail Co., Thailand
Mark Larson – Global and US Head of Retail, KPMG in the US
Vicente Yanez – CEO, Mexican National Retail Association, Mexico
Ian Starkey – Head of Consumer Markets – Europe, KPMG in the UK
Neil Austin – Global Head of Markets, KPMG in the UK
I don’t think many companies’ medium to long term strategy has actually changed. I think they put on hold a number of initiatives but in other regards, if you’ve got a strategy which you want… says where you want to be in the next 10, 15, 20 years, providing you have the wherewithal to do it, you’re not constrained by cash or credit or whatever, most companies are continuing to go ahead and, indeed, the bad times can offer well structured, well funded companies a good opportunity to get in ahead of others.
Willy Kruh – Global Chairman – Consumer Markets, KPMG in Canada
I think many of our clients have changed forever. I mean, they’ve… some of them may have gotten a little complacent over time in the sense that things have been too good for too long, and you forget to do some of the really in depth planning that you need to do to really manage through tougher times. And I think some of this has really forced them to look and become more efficient and effective and be able to do more with less, and I think those lessons learned are going to put them in good stead for the future and be much stronger companies in the western part of the world going forward.
Pat Dolan – Head of Consumer Markets, KPMG in the US
As I’ve talked to our clients about that, again it goes back to real differentiation in the marketplace. The better performers have said, look, this is a very difficult time, we’re going to focus on the cost reduction and the productivity improvement of working capital area, but we’re not going to stop growth and innovation. We’re not going to stop, you know, focusing on performance management, we’re not going to stop looking at risk management in a holistic way. So their medium to long term strategies are still wrapped around those four areas, I think. In the short term they have focused, obviously, on the cost reduction area to make sure they can survive the short term.
Archie van Beuren – Former Chief Customer Officer, Campbell Soup Company, US
In terms of the economic downturn’s affect on our long term strategies, they’re minimal. Obviously, we want to use this time to motivate ourselves to make sure we’re as close to our consumers and our customers as we’ve ever been. But that said, the things that we value, building brands, delivering healthy products that will help our consumers lead healthier lifestyles, giving them great convenience and ultimately giving them great quality, those are things that are critical.
Nick Debnam – Head of Consumer Markets – Asia Pacific Region, KPMG in China
I think in the short term, people’s strategy has definitely changed. What I’ve seen is that for a number of the retailers, for example, they’re expanding in China. People have had very aggressive growth plans in the last few years. What’s happened is a little bit more commonsense coming into the decisions about where to expand, and maybe the hell for leather growth that we’ve seen in the last few years is slowing down, but I don’t see people changing their medium and long term strategy. People will still try and build their distribution and their sales network within China.
George Svinos – Head of Retail – Asia Pacific Region, KPMG in Australia
A lot of clients are now more focused on reality rather than wishful thinking and rather than just looking at growth for growth’s sake. So people are coming back to the fundamentals of why are we in business in the first instance. And a lot of largess that did develop over a sustained period of economic prosperity is really being cut back and I think people are amazed at how much I can, in fact, cut things back by and whether or not, you know, we really didn’t take advantage of the opportunity that, you know, such an elongated period of prosperity, you know, may have provided us.
Ian Pye – Former President, Central Food Retail Co., Thailand
We are very focused on being the premium quality food retailer and everything we do is about premium quality and giving the best service. Now we’ve got to offer a bit more value so we’re giving more incentives for our customers to trade up but, as I said, one third of our customers is spending up to 25% more. They’re the ones that are responding so they’re compensating for the ones that can’t afford to.
Mark Larson – Global and US Head of Retail, KPMG in the US
I think the stronger retailers and stronger companies in general, are seeing opportunity in the crisis so some of the strategies that the stronger retailers are looking at, one, is trying to gain market share. So they may have dropped their prices a bit to gain market share with the thought that market share gained now will be market share retained in the future. And they’re also, from a strategy standpoint, looking at growth through acquisitions because a number of their competitors are weaker, their stock valuations are down, they may be over-leveraged, so there’s opportunities for the stronger retailers to acquire some of their weaker rivals.
Vicente Yanez – CEO, Mexican National Retail Association, Mexico
In other crisis, there used to be, or in America or Europe or South America or Asia, and this time it’s a global one and I think the government must take actions in order not to happen this again. They have to put regulations to those creative financing that has been the problem for this but it will have an end and as many crisis, the stronger will survive and the fittest will survive and the companies will be more creative and more… they will benefit from this crisis.
Ian Starkey – Head of Consumer Markets – Europe, KPMG in the UK
The economic crisis has forced companies to look longer ahead through into their next refinancing, whether that’s debt or equity, take that longer term view and in the short term they’ve had to cut back on discretionary spending, whether that’s travelling or compensation or professional services expenditure, they’ve had to cut back.