Deloitte SA Blog


Global Consumer Products industry shows glimmer of hope

global powers of consumer products

This overview of the global consumer product industry looks at the impact of the global economy on the consumer product industry and serves to unpack merger and acquisition and market capitalisation trends that affect the sector.

Click here to download the full report

Global Powers of Consumer Products 2014

Given the global economic challenges faced by consumer product firms, the top 250 largest global consumer product firms still managed to generate fair returns, generating sales in excess of $3.1 trillion measure from fiscal year of June 2012 to June 2013.

The Trends

Rising cost in raw materials and a bleak economic outlook curbed companies growths rates when compared to previous financial years however economist found encouraging signs of stability due to the posting of strong profitability figures.

The report found that well funded investors continued to source merger and acquisition opportunities which is highlighted by the completed M&A deals listed below:

  • 2012 : 1298 deals completed
  • 2011:  1274 deals completed
  • 2010:  1117 deals completed

The growing trend of such deals are found to be stimulated by low interest rates, increased credit availability, rejuvenated capital markets and in some cases sizable cash reserves held by firms which is surprising due to slow growth of the global economy.

Regional Trends indicated that African/Middle east companies lead the list for highest posted gains with a composite growth of 16.9% when compared to 16.8% and 5.6% growth rate of Latin American and Asian Pacific companies respectively. North American companies’ growth rates fell by 4% however it was found that they enjoyed robust profitability gains.

Industry Challenges

In order to manage and grow profits firms must look to diversify their approach into dealing with the constantly connected consumer. Global connectivity is on the rise and firms must meet growing consumer demands by adopting new strategies which include the use of end-to-end global supply chains, virtual market entry strategies, direct-to-consumer channels to name but a few.

An African Viewpoint 

There is notable absence of African headquartered Consumer Product Companies from the report.  This is largely due to the fact that these companies are either listed on a foreign stock exchange or that due to unfavourable currency exchange rates they are unable to meet the sales threshold of US $3000 million.

Deloitte South Africa will be releasing an African Powers of Consumer Products report later in the year which will look into the potential of African consumer product firms

If you have any questions or require a more detailed discussion, feel free to contact Rodger George (Africa Consumer Business Leader) at  or Clinton Houston (Consumer Product Specialist) at

Holding inventory in squirrel stores can cost your company severely


Inventory management is no oxymoron. Large international MROs have acknowledged the financial and organisational impact and value of proper control of inventory and yet, so many of the large organisations have only managed to succeed in the effective control of what is visible and in the direct control of the four walls of the warehouse.

This practice of only controlling the known stock in many instances is already well managed, with very little benefit to be derived from further optimisation. But what about the spares that are not reflected on the balance sheet? Those requested and bought, but never used, and not in the formal control of the warehouse?

By walking around the operation and looking into cabinets and open spaces, you are more likely than not to find parts lying in “informal” locations, not controlled and not reflected on the inventory management systems. Without assuming poor discipline and malicious intent to circumvent the controls and processes of the operation, have you considered “why?” and “what is the impact?”

Download the full article . . . .  Holding inventory in squirrel stores can cost your company severely

For a more detailed discussion on how Deloitte Consulting can assist your organisation in addressing the business challenges identified in this article, feel free to contact Ilse du Toit at and Clinton Houston at

How to advertise on a mobile phone and tablet

small screen

As a result of the mobile device phenomenon, advertising via phones and tablets has emerged as an attractive proposition for global brands to promote their products and services. The mobile device with its high daily use, large audience-reach and media capabilities is now top of mind for many brand managers, agencies organisations looking to influence the digitally connected generation.

Revenues from mobile media are expected to reach $150 billion1 by the end of 2012. Advertisers are starting to utilise the possibilities of mobile advertising with spend expected to jump 85.4% to $11.6 billion by the end of 2012.

With the more intelligent mobile advertising platforms finding their way into market, advertisers are now profiling users with the goal of providing more contextual adverts and increasing the likelihood of consumer engagement with the advert.

Read more . . . .    How to advertise on a mobile phone and tablet

For a more detailed discussion, feel free to contact the Deloitte Technology, Media and Telecommunications Leader, Mark Casey, at

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Is the Protection of Personal Information Bill a necessary evil or opportunity?

The corporate world is currently debating the Protection of Personal Information Bill (PPI) which will soon be promulgated. Much of this debate centres on how onerous the minimum requirements for compliance will be, how long organisations will be given to comply and what the cost implications are likely to be.

Want to learn more about the Protection of Personal Information Bill? Visit the Deloitte Protection of Personal Information Bill website or contact Dean Chivers at or Daniella Kafouris at

Some companies have chosen to take a ‘wait and see’ approach. “Those companies that see regulatory changes as an opportunity for increasing business value adopt a more positive, proactive approach and also spend considerably less in achieving compliance over the long term,” comments Dean Chivers, Director Deloitte Legal, at Deloitte. “They are able to link compliance requirements to the entire value chain of the business so that each functional area buys into its importance, realises the value that can be delivered to the business and collectively bring about change to realise this value.”

Chivers cautions that companies should implement PPI compliance as prudently as possible. “Be realistic – your organisation may not be completely compliant by the time the Act is promulgated. PPI is not exclusively an IT or legal or a process or a security issue, it’s a combination of all of these. Create the framework within which PPI will be managed within your organisation, and then build awareness amongst staff around both PPI and your entities PPI compliance framework. This will start to drive PPI issues into your framework, thereby facilitating a proactive, self-regulating model.

Chivers recommends that a response strategy be established, with the responsible person being one who understands what the law requires.

“Decide on your corporate ethics policy and define and communicate it, teaching your organisation to look out for problems,” says Chivers. “If and when a problem arises, react quickly and correctly to deal with it and close the loophole. Look for triggers that indicate your processes are not working properly.”

According to Chivers, the PPI Bill will be the catalyst for companies to add value while achieving compliance. They should engage with their customers in the process and use it as an opportunity to build customer trust in the company by highlighting the company’s efforts to treat customer’s personal information with respect and confidentiality.

The following are just some of many opportunities:

There is tremendous advantage to be gained from proactively engaging customers ahead of promulgation, for example:

  • Positive customer approvals are more likely to be obtained prior to promulgation and prior to the market being flooded with requests
  • Valuable insights can be obtained from a company’s existing customer database now, ahead of customer requests for data deletion.
  • Customers will become aware of the fact that PPI  will result in the protection of their personal information, something most  people will appreciate.
  • Companies who lead the market in becoming PPI  compliant will gain customer respect and loyalty.

PPI can also deliver many potential positives within a company, to name a few:

  • Technology gets the budget go-ahead for  middleware and data warehouses, new SAP modules, data security upgrades, etc, which  add value when linked to the overall business strategy.
  • Data analysis of personal information for  purposes of PPI compliance can yield significant useful information around  customers and markets.
  • Provides positive motivation to interface with  customers, alumni, potential employees, personal networks.
  • Employee files get updated and remain up-to-date.
  • Contracts are reviewed and updated and may even  be better than before.

Chivers recommends that the initial step should be a quick  start process prior to promulgation, followed by detailed design and implementation of value-adding initiatives. This will allow the company to gain  momentum and build a platform for future opportunities. Firstly, understand the  extent of PPI impact on customer and channel strategy, brand positioning and  employee proposition; determine possible impacts on people, processes,  technology and systems; and define key data requirements for business  sustainability.

Thereafter, look at the following opportunities:

  • Identify value-adds beyond minimum compliance
  • Design customer interactions to increase market share
  • Realign processes for a more customer focused organisation
  • Link to other initiatives such as process streamlining, productivity improvement and employee communication
  • Select technology to support more than just data integration, e.g. non-intrusive technology options ranging from cloud technology, to separate software and simple upgrades
  • Build the customer focused organisation by digging deeper into existing customer data
  • Use an approach that first establishes the organisational needs and gaps before moving to an ‘all ends at once’ implementation
  • Adopt a ‘build to last’ approach for ongoing organisational sustainability

In summary, organisations can gain measurable business performance improvements by approaching the Protection of Personal Information Bill as a strategic opportunity rather than an onerous compliance cost. Realising this potential value from the Bill, however, requires a shift in organisational mindset.

“Don’t be limited or restricted by your existing database,” says Chivers. “Use it as a contact list and first cut segmentation, design a meaningful database for future strategy and populate it by means of an automated permission campaign; don’t be restricted to a single tool or methodology – select those which are most appropriate for your needs; ensure your approach is strategic. Include change management in your implementation; don’t be purely focused on data analytics, ensure that your approach is aligned to your business priorities as well as people, process, technology and system enablers.

Chivers goes on to say “Understand how PPI affects your IT, legal, process and security options before jumping on the analysis bandwagon. Analyse the options and consider the best process for your company. There are a number of options, so give yourself the best chance of adopting the most appropriate one for your company.”

Want to learn more about the Protection of Personal Information Bill? Visit the Deloitte Protection of Personal Information Bill website or contact Dean Chivers at or Daniella Kafouris at

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