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ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??
Session co-chairs:
Joe Dybell, Tesco
Jonathan Pearce, Nestl
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ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??
1. Welcome by ECR Europe Executive Board members 5
2. Introduction by Session co-chairs 5
3. Benefits of SRP for the consumer/shopper 15
4. Retailer perspective 15
5. Manufacturer perspective 206. Panel Debate 25
7. Conclusions 5
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ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??
Philip Clarke
International and IT Director
ECR Europe Executive Board member
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ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??
Jacques Vincent
Vice-Chairman & COO
ECR Europe Executive Board member
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Introduction SRP is a reality today
Multiple solutions multiple points of view ECR Europe is mobilising the industry around
collaboration on this important topic
Principles
Functional requirements
Business case
Todays session - Need for clarity on who benefits
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SRP at the Moment of TruthA Shoppers Perspective
Tarun PatelHead of Supply Chain & ECR
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An Introduction to IGD
International organisation specialising in retailing,supply chain, category management, and shopper research
Over 600 members spanning the demand and supply chain
Manage ECR UK and are involved in ECR Europe
A team of 30 analysts, all with industry experience
Focus on the major international developments: Detailed insight on 100 international retailers and 39 markets
Discounters, Emerging Markets, Global Retailing, Private Label
SRP, Category Management, Availability, Logistics, Demand Forecasting
www.igd.com
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Agenda
Understanding the shopper issues France
UK Germany Spain
Views and feedback on SRP
Is the Shopper Ready for SRP?
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Effects of the SRP on the shopper
Yes, 22%
No, 78%
Source: IGDs International SRP Report, www.igd.com/srp
Has the industry assessed the effects of SRP on the shopper?
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IGDs SRP Shopper Research
Capturing insights directly from shoppers:
Quantitative Analysis
Spain Germany UK France
Qualitative Insight
Focus Groups Accompanied Shopping Trips
Source: IGDs International SRP Report, www.igd.com/srp
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I cant find the product I want in the store
52
37
10
2
41
50
8
1
28
51
16
5
33
51
13
3
0% 20% 40% 60% 80% 100%
Very frustrating
A littlefrustrating
Not very
frustrating
Not at all
frustrating
% Main Shoppers
France UK Germany Spain
It is easy to find the ham
aisle but not easy to f ind
which ham you want
Source: IGDs International SRP Report, www.igd.com/srp
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The product I want is often out of stock
62
29
8
2
59
33
7
1
51
37
8
4
43
35
13
9
0% 20% 40% 60% 80% 100%
Very frustrating
A li ttle frustrating
Not very
frustrating
Not at all
frustrating
% Main Shoppers
France UK Germany Spain
Im going to change the shop I
use because the one I go to now
never has everything in stock
that I want Source: IGDs International SRP Report, www.igd.com/srp
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Reaction to out of stocks
50
26
37
28
17
8
10
53
18
18
42
29
11
9
14
5
5
6
59
0 10 20 30 40 50 60
Buy the product from another
store
Buy a different brand of the
product
Wait until next time to buy the
product
Buy a different size of the
product
Do not buy product at all
% Main Shoppers
Spain
Germany
UK
France
Source: IGDs International SRP Report, www.igd.com/srp
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Top 5 out of stocks categories
France
28
24
23
20
18
0 10 20 30 40
Hair and Beauty
Household cleaning
Dairy
Frozen foods
Fresh meat and fish
UK
27
26
20
19
16
0 10 20 30 40
Bakery
Fresh fruit and vegetables
Dairy
Frozen foods
Fresh meat and fish
Spain
31
2423
21
19
0 10 20 30 40
Dairy
Bakery
Household cleaning
Hair and Beauty
Frozen foods
Germany
26
22
18
15
15
0 10 20 30 40
Fresh fruit and vegetables
DairyFrozen foods
Fresh meat and fish
Chilled Meals
Source: IGDs International SRP Report, www.igd.com/srp
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Views on Shelf Ready Packaging
0 10 20 30 40 50 60 70
Makes it easier to find products
Helps draw attention to new products
Stops the product getting damaged
Makes supermarket shelves look clean and tidy
Makes the shelves look more appealing
There is often empty packs on the shelf
Makes it harder to take the products from the
shelf
Too much packaging on supermarket shelves
% Main Shoppers
SpainGermany
UK
France
Positive
N
egative
Source: IGDs International SRP Report, www.igd.com/srp
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How does SRP make it easier to find products?
You can see what they are. If
information is on the lid it is good to
display them face out
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Makes the shelves look more appealing
3330 29
3330
33
25
30
18
32
34
30
23
0
5
10
15
20
25
30
35
40
Auchan
Carrefour
Leclerc
interm
arche
Tesco
Asda
Sain
sbury
Morr
isons
Aldi
Lidl
Plus
Mercadona
Carrefour
%M
ainS
hoppers
30% 30% 27% 29%
Source: IGDs International SRP Report, www.igd.com/srp
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Makes the shelves look clean and tidy
3634
29
39
25 2421
32
27
36 37
56
43
0
10
20
30
40
50
60
Auchan
Carrefour
Leclerc
inter
marche
Tesco
Asda
Sa
insbury
Mo
rrisons
Aldi
Lidl
Plus
Mercadona
Carrefour
%M
ainS
hoppers
30% 25% 33% 47%
Source: IGDs International SRP Report, www.igd.com/srp
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Makes it harder to take products from the shelves
4
8
1413
1211
18
11
8
13
8
13
21
0
5
10
15
20
25
Auchan
Carrefour
Leclerc
int
ermarche
Tesco
Asda
S
ainsbury
M
orrisons
Aldi
Lidl
Plus
Me
rcadona
Carrefour
%M
ainShoppers
10% 13% 9% 17%
Source: IGDs International SRP Report, www.igd.com/srp
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Safety
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Additional comments
Its good in the box once they
have enough staff to remove
the empties
The only problem I have gotwith it is the fact that the
manufacturers are going to
charge the supermarkets
more to make their job easier
for them but that price is then
passed on
It doesnt offend me as long
as its not all battered and
there is somebody coming
around to take the emptiesaway and that you have not
got to struggle to get what
you want
Source: IGDs International SRP Report, www.igd.com/srp
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Is the shopper ready for SRP?
Shelf ready solutions are on show
It affects the shopper!
Out of stocks and finding products are key issues
Get this wrong and the shopper will walk
One third of shoppers think there is too much packaging already
Shoppers do think packaging can make it easier to find product
But shoppers want reassurances that SRP wont cost them extra
Is shopper ready for SRP?
Thank you and please visit the
IGD stand at D1 for further information
www.igd.com/srp
Direction Gnrale
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XH - SRP Implementation Page 27Direction Organisation Systme et Supply chain May 30, 2006
Direction Gnrale
Shelf Ready Packaging
Carrefour
ECR Europe Conference
Stockholm, 30th
May
Xavier Hua Carrefour
Direction Gnrale
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XH - SRP Implementation Page 28Direction Organisation Systme et Supply chain May 30 , 2006
Direction Gnrale
Agenda
Objectives and guidelines
Deployment plan
Key learnings and
recommendations
Direction Gnrale
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XH - SRP Implementation Page 29Direction Organisation Systme et Supply chain May 30 , 2006
Initial objectives for SRP implementation
SRP project started in Carrefour end of 2004, being an element of ourstrategy
2- Clarify the legibility of the shelvesand improve the merchandisingstructure
1- Improve the price image ofCarrefour stores
4- Facilitate promotiondisplay and maintenance
of the permanent range
3- Improve the store operatingprocesses (out of date, shrinkage, outof stocks )
5- Decrease Supply Chain
costs
50%
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Direction Gnrale
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XH - SRP Implementation Page 31Direction Organisation Systme et Supply chain May 30 , 2006
Deployment plan
SRP is part of our global strategy and will be deployedacross all countries
France has been the first country where we started SRP implementation endof 2004Other European countries have come into the scope during 2005We are now starting the project in Asia and Latin America
SRP will be applied to all categories where it provides
benefitsFood categories have been prioritized in order to get optimal benefits,combining sales volume and shelf refilling complexity
Non Food categories are currently being analyzed in more detailsThe target is to integrate more than 50% of the volume in SRP (PAV), with anearly full coverage for Private Label Products
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Direction GnraleSRP international roll out
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XH - SRP Implementation Page 33Direction Organisation Systme et Supply chain May 30 , 2006
Supply Chain Groupe
Direction Gnrale
Supply Chain Groupe
Direction GnraleDploiement PAV fvrier 2006Dploiement PAV fvrier 2006
PAV colis Fevrier 2006 Groupe
24,33%
9,80%11,03%
16,47%
10,73%6,92%
14,72%
1,03%
9,94%
1,70% 2,58% 2,74%
9,96%9,40%
0,00%
5,00%
10,00%15,00%
20,00%
25,00%
30,00%
France
Hyper
France
Super
BelgiqueHy
per
BelgiqueS
uper
EspagneHyper
EspagneS
uper
Italie
Hyper
Italie
Super
Polog
ne
SuisseGrce
Portugal
Turquie
Hyper
Turquie
Super
Colom
bieBrsil
Argentine
CoreChine
Taiwan
Thailande
Singapour
Malaisie
Indonsie
0,00%
5,00%
10,00%15,00%
20,00%
25,00%
30,00%
% PAV colis Pays
% moy Groupe
PAV pal Fevrier 2006 Groupe
109
45
98
45
103
137
51
20
71
40
12
84
4
0,5
6%
0,3
2%
0,4
1%
0,0
4%
0,0
8%0
,25%
0,5
5%0
,24%
2,6
7%
0,5
8%0
,40%
0,3
4%
0,8
5%
020406080
100120140160
France
Hyper
France
Super
Belgique
Hyper
Belgique
Super
Espagne
Hyper
Espagne
Super
Italie
Hyper
Italie
Super
Polog
ne
Suiss
e
Grce
Portugal
Turquie
Hyper
Turquie
Super
Colom
bieBrsil
Argentine
Core
Chine
Taiwan
Thailande
Singapour
Malaisie
Indonsie
0,00%
0,50%
1,00%
1,50%
2,00%
2,50%
3,00%
nb PAV pal
%PAV Pal Pays
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Direction Gnrale
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XH - SRP Implementation Page 36Direction Organisation Systme et Supply chain May 30 , 2006
Thank You
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Shelf readypackaging
Graeme Carter, Procter & Gamble
ECR Europe Conference and Marketplace
Stockholm May 30, 2006
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Principle 1
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Principle 1
Retail Ready Packaging should only bedelivered where it adds value for the
consumer
Shelf Ready Packaging - A challenge
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Prod + Sales
Growth could
be
> costupcharge
Shelf Ready Packaging A challenge
VALUE CREATION FOR CONSUMER LOSS FOR CONSUMER
Productivity +
Sales Growth
>> cost
upcharge
Productivity
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Principle 2
Standardization will drive costs down
The impact of standardization
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Productivity +
Sales Growth
>> cost
upcharge
The impact of standardization
Lower supplier costs
Productivity
costupcharge
Advantage Challenge
VALUE CREATION FOR RETAILER LOSS FOR RETAILER
Test
VALUE CREATION FOR CONSUMER LOSS FOR CONSUMER
Principle 3
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Principle 3
When you decide to deliver RetailReady Packaging, make it a joint winner
How to win with Retail Ready
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How to win with Retail Ready
Packaging Deliver the basics:
Easy to find Easy to open
Easy to shelve
Easy to dispose Easy to shop
Avoid Industrial packaging or brown corrugate Present the right Brand image
No longer a differentiation now a cost of entry
Where to Win
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Where to WinExamples
Out of Scope
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pExamples
Industrial Packaging
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g gAn Example
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In summary
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y
Retail Ready Packaging should only be delivered where it
adds value for the consumer
Standardization will drive costs down
When you decide to deliver Retail Ready Packaging, make
it a win/win/win solution
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The How
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Colgate-Palmolive Company
Shelf-Ready Packaging
The How
Pelin KarakasECR Europe Conference, May 29-31, Stockholm
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Oral Care Personal Care
Home Care Pet Nutrition
2006: Our bicentennial anniversary
30,000 employees worldwide Markets in over 200 countries
Worldwide sales of $ 11.4 billion
Using SRP to create value for
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the shopper
Understand where SRP can improveefficiency / shelf availability
Leveraging the global expertise
Ensure a consistent implementation
With no cost to consumer
Colgates Response to SRP
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g p
A long-term project
Centrally driven
With a cross-function approach
The Roadmap
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Define good SRP for COLGATE
Evaluate portfolio, identify gaps
Leverage existing SRP
Implement quick wins Build the business case for high
investment projects
Think SRP in new project design
THE SCORECARD
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The Scorecard:
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Looks may be deceiving Dental Cream Stand-up Tubes
One-step replenishmentOpening is difficult: not quicker to shelf
Meets all other requirements
Action: solve opening issue
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What The Scorecard showed:
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Focus on the functional requirements
Every product needs to be evaluatedindividually
SRP is not black/white; its continuousimprovement
In Summary - SRP for Colgate:
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Understand the functional needs
Ask the question at new product
design
Multi-national, cross-functional
approach
Implement where it adds value for the
consumer
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ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??
Panel debate, Q&A from audience 25
Graeme Carter / Procter & Gamble
Joe Dybell / Tesco
Xavier Hua / Carrefour
Pelin Karakas / Colgate-Palmolive
Tarun Patel / IGD-ECR UK
Chris Lewis / Smurfit Kappa Group
Moderated by: Jonathan Pearce / Nestl
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ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??
Conclusions
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ProposedProposed ECR EuropeECR Europe PrinciplesPrinciples for SRP:for SRP: Always of value to the consumer/shopper, retailer andmanufacturer
In line with total supply chain efficiency principles Compliance with environmental legislation & public
policy concerns
Avoid fragmentation & complexity Maintain brand identity
Measure implementation
Need for long-term commitment
ShelfShelfReadyReady PackagingPackaging WhoWho benefitsbenefits??