growth - grocery manufacturers association | gma · bcg document 12 lessons from breakout growers...
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For internal use only
Growth Against the Odds
October 2013 GMA/FMI Conference
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BCG document 1
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BCG document 2
Growth drives value
Sources of TSR, top-quartile S&P 500
0
10
20
30
40Change in annual TSR (%)
1990-2009
Revenue growth
Margin Free cash flow
10 years
74%
5 years
58%
3 years
50%
1 year
29%
Multiple
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BCG document 3
Improbable growth
5Y revenue growth (%)
5Y TSR (%)
–20%
0%
20%
40%
–20% 0% 20% 40%
No growth
Bad growth
Good growth
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BCG document 4
Tough odds for large CPG players
62.0 61.9 61.4 60.6
8.1 8.1 8.2 8.6
20
0
100
80
60
40
Midsize
Large
12.2
2009
$664B
17.8
12.1
$677B
2010
12.4
18.0
$703B
2011
12.7
18.1
$722B
2012
Extra small
Small
17.8
Change in share '09-'12
+.5 pt
+.6 pt
+.3 pt
-1.4 pt
$ sales % of total
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BCG document 5
In search of 'uphill growers'
• Previously stagnant
• Growth turnaround
• Sustained growth
• Created value
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BCG document 6
Porsche
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BCG document 7
Earning the "right to grow"
Porsche
1992
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BCG document 8
Porsche’s growth path
Maximize the core
Expand into adjacencies
Explore new frontiers
1 year
2-4
years
5+
years
911
Boxster
Cayenne
Panamera
918 Spyder hybrid
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BCG document 9
Breakout, sustained, profitable growth
Consistent growth Incremental launches
0
100
200
300
400
500
600
700
1990 1995 2000 2005 2010
Revenue - indexed
7
1 2
19
0
5
10
15
20
(%)
TSR 90-08
Cash
flow
Multiple Margin Rev
11
0
20
40
60
80
100
120
New vehicle sales ('000s)
12
10
08
06
04
02
00
98
96
94
92
90
Source: Global advantage database, BCG analysis, Porsche annual reports
Growth-driven value
911
Boxster
Cayenne
Panamera
924/944/968
Porsche
Auto and comps
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BCG document 10
Starting position matters
Competitive premium
Competitive stability
Low
Low
High
High
Stable low-premium
Turbulent high-premium
Stable high-premium
Turbulent low-premium
% o
f com
pani
es
48% %
of c
ompa
nies
83%
17% %
of c
ompa
nies
66%
% o
f com
pani
es
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BCG document 11
Competitive premium
Competitive stability
Low
Low
High
High
Stable low-premium
Turbulent high-premium
Stable high-premium
Turbulent low-premium
Starting position matters
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BCG document 12
Lessons from breakout growers
Stable low-premium
Turbulent high-
premium
Stable high-
premium
Turbulent low-
premium
• Reinvest in core and explore adjacencies
• Build a "bet portfolio" • Move quickly: kill or scale up
• Seek near
adjacencies • Maintain
core • Transplant
globally
Maintain/expand margin while growing
• Migrate
core: new frontiers
• Monetize poor portfolio
• Prioritize domestic
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BCG document 13
1. Clarify your aspiration
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BCG document 14
1. Clarify your aspiration
2. Know your advantage
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BCG document 15
1. Clarify your aspiration 2. Know your advantage 3. Widen your perspective
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BCG document 16
Wider field of vision
Where to play
Commercial initiatives
Maximize the core
Expand into adjacencies
Explore new frontiers
Organic innovation
M&A/ partnership
Business model
innovation
How to win
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BCG document 17
1. Clarify your aspiration
2. Know your advantage 3. widen your perspective
4. Force tough choices
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BCG document 18
1. Clarify the aspiration 2. Know your advantage 3. Widen your perspective 4. Force tough choices 5. Fund the journey
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BCG document 19
1. Clarify the aspiration
2. Know your advantage 3. Widen your perspective
4. Force tough choices 5. Fund the journey
6. Align vision and action
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BCG document 20
Integration of vision, choices, action
Purpose
Vision
Strategic choices
Initiatives
Enablers
Goals and metrics
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Thank you
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