MARKET SEGMENT REPORT Consumer Products and Retail€¦ · the Consumer Packaged Goods industry has...

M A R K E T S E G M E N T R E P O R T

Consumer Products and Retail

I N D U S T R Y O V E R V I E W

Consumer buying behavior, competition among brands and digital transformation are collectively causing massive change in the CPG and Retail markets throughout the world.

The way products are being produced, sold and delivered is changing throughout the entire industry making CPG companies rethink their processes from beginning to end. Some of the most significant changes are happening in the food and product manufacturing space with automation and co-bots increasing speed and output. Job skills are evolving to become more

digital and machine focused to increase efficiency and employee productivity. The CPG workforce is responding with a demand for upskilling and reskilling in additional to new ways of work like freelancing. These changes are restructuring the talent and employer relationship completely in the Retail and Consumer Product vertical like never before.

The industry is also being heavily impact by changing regulations and trade wars between some of the world’s largest importers and exporters. Navigating these changes within a

tight labor market and high volume of job openings is proving to be a challenge among Consumer Products and Retail companies around the globe.

Pontoon is here to help our clients understand the changes in the industry and prepare for the future of work. We have the tools to implement MSP, RXO and Total Talent solutions that will ease hiring in a candidates’ market, reskill the workforce for future jobs and find alternate workers to fill any need a hiring manager may have.

As said recently by World Economic Forum:

The Retail and Consumer Packaged Goods industry will change more in the next

10 years than it has in the past 40 years





O U T L O O K B Y R E G I O N

The following sub-industries will see significant

growth throughout LATAM in the coming years:

Sub-sector Compound Annual Growth RateBeauty products sector 3.6% through 2021Consumer electronics sector 4.6% through 2023Food and beverages market 9% through 2023Non-alcoholic beverages sector 3.5% through 2021Nutrition and dietary supplements 8.8% through 2023

Consumer Confidence Index 2019 based on political and economic outlook:Colombia 105Mexico 100Peru 95Brazil 95Chile 90Argentina 70Venezuela 65

Source: Americas Market Intelligence

Challenges Within The Region

Taxes vary widely within countries, regions, cities and

rural areas

Poor infrastructure results in surcharges for goods

delivery up to 15%

P R O M I S I N G G R O W T H

Latin America and South America

Sources: LS-International, AmericasMIM A R K E T S E G M E N T R E P O R T


Stagnant growth in Consumer Products and Retail in Europe has been effected by: • Political uncertainty • Low consumer confidence • Threat of raising interest rates

U N S T E A D Y C O N S U M E R C L I M A T E S A L E S I N E M E A

Europe

Brexit Effects on CPG CompaniesProduct standard and safetyCurrently the UK is abiding by the EU’s product stands for safety and labeling Post-Brexit, products from the UK will likely lessen their adherence to the strict standards due to changes in production costs and varied marketing communication practices

On the other hand, E-commerce business is increasing a rapid pace

7 of the 10 fastest-growing companies in the Europe 500 are consumer brand manufacturers

Sources: Bloomberg, Deloitte, Digital Commerce360



Talent Shortage deepensThe UK will have a harder time filling roles at all skill levels in the CPG industry since EU nationals will no longer be able to easily work in the UK.

Two options to address this issue: 1. Prepare to provide visa sponsorship to workers willing to

come to the UK from outside the EU2. Relocate some operations outside the region where talent

is more available

G R O W I N G C O N S U M E R M A R K E T A C R O S S A P A C

Asia Pacific

ChinaConsumer buying power in China has significantly increased and will continue to do so in the future

2005 2016 2025

Annual Household Income in China

Affluent >222,000 renmnbi / > $35,000

New Mainstream 103,000 - 222,000 renminbi / $16,000-$35,000

Mass 37,000 -103,000 renminbi / $6,000 - $16,000

Poor <37,000 renminbi/$6,000

Maximum buying power

China’s consumerism has also been fueled by accessibility to a vast online retail landscape

$800 billiononline retail market – largest in the world

18%growth rate per year in 2017 and 2018

Automation in Consumer Goods manufacturing throughout Asia will cause of shift in the workforce

• Low skilled workers will be displaced• Increased difficultly sourcing high skilled worker such as data

scientists and automation engineers

Source: McKinsey



C O N S U E M R M A R K E T C H A N G E S

North America

Traditional grocers are seeing tight margins shrink more and a shift in consumer buying habits

• Food-service revenues already exceed food-at home sales

• Almost half of US millennials say they rarely prepare meals at home

As a result, companies are employing less in-store workers and more digital customer experience workers, order fulfillment and delivery fleets

Consumers and companies alike want data privacy regulations implemented to protect personal data often exchanged during online purchasing transactions

60%

Nearly 60% of U.S. consumers believe the federal government should regulate how

companies use consumer data

66% of American companies believe the U.S. should implement regulations similar to GDPR, which was likely in response to recent Congressional hearings

and privacy disclosures

66%

Sources: DigitalCommerce360, McKinsey





I N D U S T RY O U T L O O K B Y R E G I O N

C O N S U M E R I S M H A S B E C O M E D I G I T A L

Future

Purchases become automated

Buying habits are tracked, ordered and arrive at your home routinely

“Alexa order my shopping list”

By 2020, more than 3.3 billion users will have virtual assistance on their devices

Mobile wallets are expected to surpass both credit and debit purchases by 2020

Past

Technology assisted purchasing

In 1994, 98 million Americans purchased $60 billion of products through phone ordering from catalogs and TV shopping channels

Amazon arrived in 1995

Present

Online shopping becomes personal

Consumers place value on having a custom tailored shopping experience

88% of consumers say they’re more likely to shop with retailers that deliver personalized and connected cross-channel experiences

79% of organizations that exceeded revenue goals have a documented personalization strategy

Sources: HostingFacts, Money.com, NChannel



N E W W A Y S O F S E L L I N G T O C O N S U M E R S

Direct-to-consumer brands

Directly to consumer selling-eliminating the retailer

Consumers appreciate the direct attention from the brand

and brands enjoy higher margins by removing the costly

distribution channels

75% of consumers prefer personalized

experiences from their CPG purchases

Pop-up storesLarge brands are launching experimental products in with temporary and fast go to market strategies

Create buzz

Sell limited quantities merchandise for a short time

Collect customer feedback

Close and move to another temporary location

Freelancers are the ideal workforce to staff this type of retail environment.

Benefits of freelancers include: o Flexible, on-demand scheduling

o Lower cost or no benefits to cover

o Understanding of a short term commitment

o Untapped worker pool (34% of the American workforce is freelancing)

Sources: Deloitte, VisionCritical, Inc.com



Selling products and goods seamlessly through physical and digital platforms

The Last Mile

In today’s demanding consumer market, companies deliver goods to consumers as fast as possible, with flexibility and cost efficiency

JD.com

In-trunk deliveries

In-home deliveries

Amazon DHL/ Amazon

Parcel Lockers

Fetcher

In hand delivery via smart phone

app locator

Consumers want simple but effective ways out of acquiring goods

Elements of omni-channel retailing include:

• Targeted product ads based on search history

• Buying capability across any digital platform, device or physical location

• Ease of ordering – payment options, one-click ordering, delivery options – curbside pickup and returns any way

Why is this important?

73% of shoppers reported using multiple channels to purchase goods Consumers expect 2-day or immediate delivery, this demand has spiked the need

for more drivers and many have been filled by the gig economy

O M N I - C H A N N E L R E T A I L I N G

Sources: Money.cnn.com, Shopify, UniversumGlobal



I N T E G R A T I N G N E W T E C H N O L O G Y

Co-bots

Robots and automated machines will work along side production workers in goods manufacturing environments and store operations

Walmart plan to deploy robotic janitors and Giant Eagle will have robotic assistants in their stores

In 2018 alone, the co-bot market grew by more than 60%, nearing $500M in global sales

Operational Data

Collecting and analyzing data to conduct sophisticated analytics

Tap into artificial intelligence (AI) to evolve product design better manage supply-chains and optimize shopping experience

Data Scientist and AI Engineers will lead as highest in demand skillsets

Robotic Process Automation

Speeding up and improving accuracy of invoicing and accounting tasks

Back office reporting and data collection for historical analysis and future planning

54% of the work done in the Consumer Packaged Goods industry has the potential to be automated

The Retail Automation market will increase from $8.79 billion in 2017 to $14 billion by 2022

43% of CPG executives automate tasks primarily to cut costs and increase efficiency

Sources: Uipath, PeriscopeSolutions, Accenture



J O B S



479,667 jobs open in EMEA

Belgium 23,172France 115,219Germany 113,828Netherlands 16,141Russia 183,951Sweden 12,686UK 111,350South Africa 14,670

3,107,560 jobs open in APAC

Australia 55,986Philippines 17,221China 2,752,802India 100,762Japan 163,431Singapore 17,358

1,955,689 jobs open in Americas

North AmericaUS 1,780,486Mexico 48,694Canada 116,636

South AmericaArgentina 4,252Brazil 9,873Colombia 13,309

This map shows the number of positionscurrently open on TalentNeuron in Consumer Products & Retail in each country. Categories include:

• Sporting Goods• Tobacco• Supermarkets• Food Production• Consumer Electronics• Consumer Goods• Furniture• Retail• Food & Beverages• Consumer Services• Wholesale• Wine and Spirits• Luxury Goods & Jewelry

Source: TalentNeuron

E M P L O Y E R H I R I N GCurrent open jobs by country

O P E N J O B V O L U M E B Y S K I L L S E T S I N T H E U S

Popular positions requested by Pontoon clients

General LaborLos AngelesNashvilleSt LouisLouisville

MerchandiserSan AntonioNew OrleansChampaign- Urbana, ILLubbock, TX

Material HandlerNashvilleSan AntonioLancaster, PADayton

Route Sales RepDallasCincinnatiIndianapolisLos Angeles

Warehouse WorkerLos AngelesMiamiSan AntonioToledo




F U T U R E O F J O B S

Emerging OccupationsAdvances in innovation will require a re-skilled workforce responsible for harnessing the capabilities of that new technologies will bring to the Consumer Products & Retail sector

o Data Analysts and Scientists

o Sales and Marketing Professionals

o AI and Machine Learning Specialists

o Training and Development Specialists

o General and Operations Managers

o Ecommerce and Social Media Specialists

o Organizational Development Specialists

o New Technology Specialists

o Information Technology Services

o User Experience and Human-Machine Interaction Designer

Diminishing OccupationsRobotic Process Automation has replaced many of the functions traditionally completed within these roles. Reduced by 34% in 2018 and projection in 2022 show these roles down by 24%

o Data Entry Clerks

o Accounting, Bookkeeping and Payroll Clerks

o Assembly and Factory Workers

o Administrative and Executive Secretaries

o Material-Recording and Stock-Keeping Clerks

o Cashiers and Ticket Clerks

o Postal Service Clerks

o Garment and Related Trades Workers

o Business Services and Administration Managers

o Social Media StrategistM A R K E T S E G M E N T R E P O R T


S H I F T I N G J O B T A S K S

Augmentation of key job tasks in Retail and Consumer Goods in 2018 and 2022

Shift in tasks that have been done traditionally by humans will be completed by machines in the coming years

2018 2022

70%

76%

71%

30%

24%

29%

P e r f o r m i n g p h y s i c a l a n d m a n u a l w o r k a c t i v i t i e s

C o o r d n a t i n g , d e v e l o p i n g , m a n a g i n g a n d a d v i s i n g

C o m m u n i c a t i n g a n d i n t e r a c t i n g

50%

60%

60%

50%

40%

40%

Human MachineMachine Human

Source: World Economic Forum


Consumer Products and Retail June 2019

TA L E N T L A N D S C A P E



46,624,000 professionals in Americas

North AmericaUnited States 30,297,000Canada 4,018,000Mexico 5,046,000

South AmericaArgentina 1,408,000Brazil 5,855,000

26,882,000 professionals in EMEA

Belgium 777,000France 5,511,000Germany 3,983,000Netherlands1,010,000Sweden 844,000Russia 8,225,000UK 4,376,000South Africa 2,156,000

342,325,395 professionals in APAC

Australia 2,125,000Philippines 315,395China 275,510,000Japan 7,606,000India 56,456,000Singapore 313,000

W O R K F O R C E S U P P L Y C H A I N

Talent by regionThis map shows the current workforce on TalentNeuron inConsumer Products & Retail ineach country. Categories include:• Sporting Goods• Tobacco• Supermarkets• Food Production• Consumer Electronics• Consumer Goods• Furniture• Retail• Food & Beverages• Consumer Services• Wholesale• Wine and Spirits• Luxury Goods & Jewelry


A V A I L A B I L I T Y O F T A L E N T B A S E D O N S K I L L S E T I N T H E U S

Highest supply of workers based on highest demanded skillsets by Pontoon clients in Consumer Products & Retail

General LaborLos AngelesNashvilleSt. Louis Louisville

MerchandiserNew OrleansSan AntonioRockford, ILLynchburg, VALubbock, TX

Material HandlerNashvilleSan AntonioMiamiLancaster, PA

Route Sales RepDallasLos AngelesCincinnatiIndianapolis Las Vegas

Warehouse WorkerLos AngelesMiamiSan AntonioVirginia Beach/NorfolkLas Vegas




T A L E N T T R E N D S

Custom and Creative Benefit Packages

In addition to competitive pay and traditional benefits CPG workers expect extra fringe benefits to when joining a new company

From a survey of 500 CG workers by Force Brands, these are the Top 5 most sought after benefits in 2020:1. Off-site social opportunities, like weekly cocktail parties (18%)2. In-office stress relief or fun (17%)3. Flex-time or telecommuting opportunities (17%)4. Tuition or continuing education reimbursement (16%)5. Paid sabbaticals for personal, volunteer, or professional

development reasons (16%)

Training and Development Opportunities

CPG workers are well aware of the digital evolution happening in the in industry. To continue to be valued, workers want to learn new skills and evolve their career paths in line with company initiatives

62 percent of workers say it’s important to develop their skills to be able to work with intelligent machines in the next three to five years

62%

Source: RecruitingDailyAdvisor



R I S K S & C H A L L E N G E S



P R E P A R I N G F O R M A J O R D I S T R U P T I O N

Intensifying Competition

Traditional retail and consumer goods companies now also compete for

talent against direct-to consumer companies, attractive start-ups, and

tech giants

“Acqui-hiring,” is the latest trend with large retailers

such as Target and Walmart. These companies acquire

start-ups mainly to attain their talent

New Technologies

Implementing and training employees on AI and automation will

keep workers engaged and minimize their departure to other firms

that are willing to reskill

Recent predictions estimate 25 to 31% of the 3.3

million business services jobs are at high risk of

automation in the next 10 to 20 years

“Continuing pressure on margins, competitors disrupting the market and the challenges of attracting new generations of workers mean business services need to improve productivity and efficiency to be profitable in future

Deloitte, The Connected Worker

Source: Deloitte, McKinsey



T R A D E T A R I F F S & P O L I C Y C H A N G E S

Consumer Products companies must prepare for risk scenarios where tariffs could severely impact their export and import business

US – Approximately 41 million American jobs are dependent on trade

Nearly one third of acres of farms in America is planted for exports. More than half of crops like wheat and almonds are sold outside of the US

Steve Madden: The shoe and handbag maker is preparing for the tariff to rise to 25% in January from 10%, creating an added $30 million headwind. Currently it sources only 16% of the affected goods from outside China; it’s now targeting to raise that to 40% or 50% next year, with Cambodia a big beneficiary

MillerCoors: Brewer says profit could fall by $40 million depending on how much aluminum prices rise

Procter & Gamble: Cites ‘meaningful’ impact of tariffs on a handful of products in Canada, which accounts for 3% of global sale

Coca-Cola: Raised prices for soda and other beverages to offset higher costs for freight shipments and metals used in its bottling systems

In a survey of 1,100 global companies – across all industries –found that boards spend less than 10% of their time on risk management

Taiwan – Giant Manufacturing: A 10 percent tariff would cost the industry an additional $100 million, and that figure would rise to $250 million if the duty rises to 25 percent, the company told the U.S. Trade Representative in a letter

China – Samsonite: Wholesale buyers notified in a letter than a 10 percent price increase is imminent if the U.S. follows through with tariffs on Chinese goods on Sept. 24

Source: Bloomberg Tariff Tracker



H E L P I N G O U R C L I E N T S S O LV E H I R I N G O B S TA C L E S



How to Close the Skills Gap

S K I L L S G A P

Growing the skills of the existing workforce

35%of the skills demanded for jobs across industries will change by 2020

World Economic Forum

Offer external training courses

to employees through General

Assembly

Inter-department shadowing

of colleaguesto develop

farther reaching skills

Learning and development

courses to develop skills of

existing workforce



1 2 3

T A L E N T S H O R T A G E

Managing the workload with fewer traditional workers

58%of companies said they use gig workers to access skills and experience that is not

available in their current workforce

Forbes

How to win the war for talent

Access to large pools of

freelancers candidates for

project based work

Re-skill existing

workforce with General

Assembly courses

Partner with Lee Hecht Harrison to

restructure the current workforce to

best utilize the employees



321

C O M P E T I N G F O R T A L E N T

Attracting talent in a limited market

Prospective candidates want to join companies that offer opportunities for growth and outlets for creativity

Organizations must set themselves apart from the pack to attract top tier talent

Fosters innovation

among your

workforce

Provides learning opportunities

for skills development with

General Assembly

Offers competitive

pay, benefits,

bonuses, incentives

Offers flexible

work

arrangements

Win talent with a strong employer brandPromote a workplace that:



1 2 3 4

Ways to prepare for the Gig Economy

In the United Kingdom, France and the Netherlands, freelance growth has outpaced overall employment growth.

“Legacy models of employment will be “dissolved and replaced with talent marketplaces driven by the surge of on-demand labor platforms and online work management solutions.”

Accenture

Freelancers will make up 50% of the workforce by 2025

Evaluate what part of the business can be outsourced to freelancer– project work, seasonal influxes

Tap into the freelancer talent pool by implementing an FMStool

W O R K F O R C E 2 . 0 F R E E L A N C E R S

New composition of the workforce



1 2

42

A D D R E S S I N G T R E N D S & C H A L L E N G E S W I T H

P O N TO O N ' S E C O S Y S T E M



G E N E R A L A S S E M B L Y

Building the talent pool by up-skilling and re-skilling

Pontoon’s partnership with General Assembly faces this issue head on. GA aims to identify skills that are most in demand then provide training to increase the number of skilled workers in a given market

Today’s talent shortage is being felt across the global and across all industries. Consumer Products & Retail is seeing the effects of advances in technology in many skillsets and not enough talent to keep up withthe changes landscape of this field.

Employees can enroll in programs while working in their current role with plans to transition into the new roles or expand responsibilities once the GA programs have been completed

We must focus on developing the skills within the current workforce as the world of work rapidly transforms

L E E H E C H T H A R R I S O N

Transforming the workforce

Lee Hecht Harrison has the expertise to guide organizations through strategic workforce transformation. With AI driven services including internal talent redeploy, outplacement and change management program, LHH will guide companies to be most effective in the current tight labor market

LHH has the capability to identify talentedcandidates through their powerful AI platformreaching of all levels and industries. Retaining and engaging talent is done through career development and coaching of both employees and leadership

Employers can leverage Lee Hecht Harrison’s industryinsight to optimize their workforce developing leaders be a consultative partner best suit business needs

“The alignment between organizational talent needs and an individual's career goals can be a potent force that not only prepares your organization to meet the challenge of business transformation, but also boosts engagement, retention and productivity.”

Melanie Stave SVP, Talent Development Practice Leader, LHH

T H A N K Y O U

+1 855.881.1533

[email protected]

www.pontoonsolutions.com

@pontoon2019



MARKET SEGMENT REPORT Consumer Products and Retail€¦ · the Consumer Packaged Goods industry has...

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Transcript of MARKET SEGMENT REPORT Consumer Products and Retail€¦ · the Consumer Packaged Goods industry has...