• Key market insight• Balancing Risk vs. Reward• Understanding Challenge and Resolution• Leveraging established ROI models

HOW CAN SE GROCERS’S DRIVE CONSUMER TRUST THROUGH:

BRAND NEWSyour

A Private Brand Business Case Study

INCREASING SE GROCERS BRAND LOYALTY

Southeastern Grocers is poised to raise its visibility of unique, high-margin private brand items to more effectively compete within the industry. As Southeastern Grocers capitalizes on its deep understanding of current customer needs, additional focus will be placed on attracting new customers in the face of a rapidly expanding marketplace.

Issue 12

Private brand is a key driver of our growth Trace One has provided a system and solution for our needs.Jack Pestello, Senior Vice President Walmart

In a recent Trace One survey of over 3,000 global consumers, it was found that 23% of U.S. consumers buy private brands because of trust in product quality. While Southeastern products are low-cost, the company will need to continue to increase its private brand share to match the U.S. market share of just over 20%. Critical to this growth, is to focus on new ways to innovate, increase quality and offer more value to their existing and new customers.

An Evolving MarketAs the private brand market adapts to growing regulation changes and a more connected shopper, retailers need to prepare for the risks and rewards of a greater private brand impact.

45% 4,300 375,000

of consumers could recall a negative social media post

about a business in the past six months

views of a product recall notice posted on social media in less than one week

consumer views of a product issue posted and shared on social media 5 years after

it has happened

46.5%18% X%

U.K. / France United States SE Grocers

FINANCIAL OPPORTUNITYTHE SMARTER SHOPPERLEGISLATION AND RISK• Challenging economy• Growing private brand demand• Pressure on cost

• More diverse product set• Full ingredient transparency• Connected consumers

• Continual law change• Costlier crisis management (recalls) • Greater reputational risk

Social Media Impact Private Brand Market Share81% of PR professionals consider that social media has a more rapid impact on consumers than traditional media - A connected consumer can break years of trust in minutes via Social Media.

As they have for nearly a decade, private brands continued to be the principal growth engine in the U.S. rising to 21% market share in 2014 and are predicted to hit 35% in the next 6 to 8 years.

Pressure of legislation, increase of consumer demands and the opportunity to drive private brand revenue is creating a ‘perfect storm’ in the U.S. market.

There is a clear objective for U.S. retailers to grow private brand share to be more in line with the mature European market.

Risk Reward

How do I balance out

business risks?

Evolving LegislationRecalls/Withdrawals

Consumer AwarenessNon Collaborative Suppliers

Team InefficiencySlow to Market

Competitive Threat

Keep up-to-date with Regulation Improve Efficiency & Reduce Errors

Drive Consumer TrustB2B Engagement

Cross Functional Team InvolvementIncrease Speed to Market

Decrease Cost of Sale

Risk vs. Reward

On April 13, 2015 Blue Bell recalled all of their products on the market made at all of their facilities. The Blue Bell Creameries recall cost over $200 million; 1,450 employees laid off; 1,400 employees furloughed. Blue Bell needs up

to $125 million to overcome the earlier recall crisis or be forced to shut down.

Consumer Reports survey names Wegmans best grocery store. Wegmans customers are provided with improved private brand quality, development of premium private brands,

emergence of new channels and the creation of new categories which has

added to the Wegmans brand strength.

As consumers demand more choice and retailers look to differentiate themselves, there is more risk than ever coming into the private brand business.

The challenge is to understand and manage the risks. Private brands have become increasingly innovative, with complex ingredients coming from new

sources. With these changes come inherent risks. Growing private brands will require using solutions to help retailers manage these risks and achieve greater financial returns.

In a connected world, it is more important than ever to understand and then mitigate risk.

With a growing private brand market and the potential to increase consumer loyalty, business rewards are greater than ever.

Trace One is our best solution to prevent risk and keep control over cost. Today, it takes us only 1 hour to manage an alert on an ingredient.

Hervé Gomichon, Quality Director, Carrefour

Increases vulnerability

to crisis

Introduces new levels / types of risk

Affects speed to market Ability to manage

process & cost

Increasing size of supply

chain

Growinglevels of

sophistication

Challenges vs. Business Resolution

• From ‘me-too’, to 3 and 5-tier programs

• Low levels of product knowledge

• Reputation starts to be a key issue

• Customers start to focus on issues

• Ad-hoc, silo and manual processes start to break

• Labelling errors and QA failures begin

• Strategies are needed for both pro-active and re-active crisis management

Private brands continue to represent outstanding value to the shopper. However, as retailers become more innovative with their private brands, the greater the risk and challenges. Despite these increased risks and challenges, rewards to the retailer are also increasing.

For every challenge there’s a resolution, and the hurdles of product development are no different. Business leaders can overcome these challenges by simply providing one clear vision to all stakeholders as well as making sure internal/external teams work efficiently and effectively.

SaaS Platform:• Provide real time information, to make better business decisions• Grow to meet the needs of the business, utilizing flexible scalability

Consistent Process:• Manage key steps throughout product development to mitigate

business risk• Increase speed, accuracy and drive standardization through

proven process

Clear Visibility:• Respond quickly to crisis and manage complaints by leveraging

one version of the truth• Proactive business and impact analysis enables faster identification

of issues and resolution, faster

Improved Collaboration:• Ensure internal teams work more effectively through collaborative

business planning• One centralized solution and knowledge base enhances

partnerships, strategy and innovation

Data Accuracy:• Manage ingredient statement, allergens and nutrition through

proven industry specification templates • Cut down on costly packaging labeling mistakes by utilizing

data directly from the source

Only through a combination of solutions process and collaboration is it possible to execute business resolution.

Taking advantage of financial rewards introduces a new set of challenges into the business.

Solution and Industry Leading Process

Specification Management

Proven knowledge from working with the world’s leading retailers and manufacturers, over the last 14 years.

Product Development Management (PDM) solutions have been specifically designed for fast-moving consumer goods retailers looking to manage or grow their current private brand programs.

PDM Consists of:• Product Lifecycle Manager (PLM),

an information management system that will integrate processes and data across the full product lifecycle.

In today’s fast growing consumer goods industry, high-quality and productive product lifecycle management requires the perfect control of product file management. Private brand PLM product specification manager centralizes all data related to product development and commercialization.A wide range of templates makes it possible to cover all product categories and accelerate the work of each party involved; reducing time-to-market by reaching the final specification more quickly.

Strategy & Planning

Supplier Selection

Specification Packaging Quality Management

Supply Chain Management

Food Supplement HPC Cosmetics OTC

• Specification Manager that will allow management of private brand product specifications efficiently and cost-effectively.

Project scopedefined

Manufacturer(s)selected

Specificationtemplate issuedfor completion

Iterative

New range

identified

Specificationcompleted

Specificationvalidated

Communication issued to

manufacturers

Productaudited Product

launched

Manufacturersidentified

Increase volume & efficiencyProactive search / react to issuesDrive consumer trust / reputationIncrease product quality

Private brand PLM is specifically designed for the retail/CPG industry to support the process of product development for formulated package goods. Combined with proven business process and a common collaborative platform, it allows for improving private brand strategies when required.

Industry tested and enhanced by retailers, for retailers.

A Proven ApproachTo drive high levels of user adoption, it is imperative to install an underlying support and management platform.

Business Socialization and Collaborative Engagement It’s no secret that collaboration comes with great benefits. These benefits have been well-documented and are linked to reducing complexity and costs of product development, reducing the need for input from wide and varied areas of expertise, as well as increasing the time to market.

Educate: Tailored training sessions based on user role, business process and configuration

Support: Dedicated support team available for user, technical and training support

Evolve: Continued program enhancement, knowledge updates and collaboration improvement

Manage:Account and program management, enabling ongoing planning

Food Service buyers & Product

development

Marketing &packaging

Auditing &testing bodies

Manufacturerfinished goods

Consumer Complaints

Product issuetracking

Collaboration Networkin the cloud

A Proven ApproachA tailored supplier collaboration program to drive business benefits for all parties.

LaunchCollaborative program that is tailored to retailer’s objectives

EducateSupport the suppliers with the required level of knowledge needed to succeed

MaintainPro-active and re-active support combined with a centralized knowledge base and dedicated program management

Improved collaboration can affect every interaction between a retailer and supplier. The higher their level of collaboration, the more efficient, cost-effective, responsive and innovative the product development process will be.PLM facilities can streamline this relationship through an easy to use, highly visual collaborative experience. Engaging within the network results in greater efficiency of every interaction between retailers and supplier partners.

Connecting all stakeholders in the product development process in a collaborative, scalable model.

Retailers and suppliers achieve private brand success when they share one version of the truth.

Scalability when needed• Phase based ROI approach• Proven implementation model for

Specification Management in 2-3 months• Scale when you need it and adaptation to

your business growth• Future proof

Depending on your private brand sophistication and need, the solution is designed to scale quickly, while maximizing ROI along the way.

Product Development Management

Tra

nsp

are

nc

y-O

ne

Onboarding / Collaboration / Program

SpecificationManagement

Product Life CycleManagement

2-3 months 3-4 months

Engage

Va

lida

tion

an

d N

ee

ds

An

aly

sis

Business Process

N N

Specification PLM Transparency

Scale, Vision and Return on Investment

Increase in suppliers’ engagement &

efficiency

Decrease in costs associated with finished

goods/raw materials

Improvement in crisis management &

recall reaction time

Current ROI figures based on $1B in private brand and current Trace One customer rate of return

What would it mean if your business could achieve the following goals ?Q Double your Private brand business. How

much would that add to your bottom-line? 3M

Minimize the time it takes to react to an issue. What would you save? 500k

Reduce your product purchasing price by 1%. What is that worth? 1.5M

Reduce product recalls by 50%. What impact would that have on customers? 750k

Average:

75% 0.5-1.5% 95%

Understanding risk and overcoming key business challenges results in the ability to maximize continual return on investment.

The Trace One application allows us to deliver on our consumer satisfaction promise. Alain Turenne, Senior Director, Product Integrity Walgreens

Clear execution and adoption ensures that theoretical ROI become actual business profit.

Growing sophistication is a continual process, ensure your business can scale when needed.

The World Leader in PLM Solutions

Recognition

Over 20,000 companies connected using

Trace One

100+ countries users presence

+$300B in Private brand revenue

managed

Customer Snapshot

Trace One leadership has a compelling vision and well-crafted strategy to further infuse PLM into the Private brand market.

Solution Footprint OverviewProduct Development

Product

Project Workflow

Workflow

Incidents Tests Audits

SpecSpec Management in PDM

Product Lifecycle Management in PDM

Pack Copy

Community

Packaging

Artwork

Analytics

Business Intelligence and Reporting

Collaboration with business partners

Supply Chain Visibility

Engage

Transparency-One

Benefits

SaaS Platform

Data Accuracy

Consistent Process

Improved Collaboration

Clear VisibilityDrive global consumer trust with Trace One

www.traceone.com

Contact For more information please visit: www.traceone.com

Email: info@traceone.com