Retail business models are under pressure as they adapt to cost inflation, online and hard discount competitors, and rapidly changing customer needs. Instead of trying to squeeze more margin out of suppliers, we see the most successful retailers seeking joint solutions with their top suppliers. The value at stake is tremendous. For example, looking at just the fresh categories in UK, France and Germany alone, we estimate that in excess of $8 billion of combined contribution margin improvement is available from forming retailer-supplier partnerships.
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Retail business models are under pressure as they adapt to cost inflation, online and hard discount competitors, and rapidly changing customer needs. Instead of trying to squeeze more margin out of suppliers, we see the most successful retailers seeking joint solutions with their top suppliers. The value at stake is tremendous. For example, looking at just the fresh categories in UK, France and Germany alone, we estimate that in excess of $8 billion of combined contribution margin improvement is available from forming retailer-supplier partnerships.