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CPG Execs Losing Sleep Over Growth Initiatives: GMA/A.T. Kearney Study

WHITE SULPHUR SPRINGS, W. Va. -- The Grocery Manufacturers Association (GMA) and A.T. Kearney yesterday released "Insomnia in the Corner Office," a white paper that defines the challenges and opportunities facing CPG executives. The survey found that nearly 30 percent of all respondents said their existing business models are the main barrier to growth.

"We undertook this effort with GMA to help cut through the noise and identify the top issues that are shaping the industry," Michael Lofgren, principal at A.T. Kearney, said. "Ultimately, we wanted to quantify the insight we gained from these leaders."

In open-ended discussions with 124 leading CPG industry executives, the No. 1 issue among all respondents was finding sources of sustainable growth. Other important issues included fostering joint collaboration efforts with customers and working closely with the government concerning regulations and trade policy.

"Insomnia in the Corner Office" also broke down the issues specific to the food and beverage and general merchandise/health and beauty care/household manufacturers (GM/HBC/household) sectors. Health and obesity were the biggest issues for food and beverage executives, and, aside from the issue of growth, the rising cost of commodities was the top issue that made the GM/HBC/household manufacturer executives interviewed rethink their commodity procurement methods.

"The report illustrates that CPG leaders are not indifferent to the challenges facing our industry," said GMA president and c.e.o. C. Manly Molpus. "We have a plan to meet these challenges, and are moving forward with a robust strategy for 2007 and beyond."

As CPG executives look to the future, survey respondents identified several top-tier issues that have intensified over the years: responding to globalization and its impact on competition, with most executives citing China as an example; gaining a better understanding of consumer demographics and needs; and bracing for the trend in channel fragmentation.
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