Per the clients request, any identifying information has been excluded.

Our high growth retail client experienced a significant share price decline after missing earnings expectations. We identified the company’s core strengths and performance improvement options. The resulting broad-based performance improvement program created $2.5 billion in shareholder value

At A Glance

$2.5B

Shareholder Value Created

$81M

Annual Cost Savings

P&C Helps Its Client Take a Step Back to Realign Product & Pricing With Customer Strategy

Our retail client had enjoyed high growth and was planning to double its store count within 2-3 years, as well as increase diversification into new channels, products, and geographies. Unfortunately, they had failed to meet earnings expectations for the first time, causing a significant share price decline. Investors blamed a variety of factors including concept saturation and over-diversification.

P&C Worked With the Client to Address the Following Questions

  • How do we identify, prioritize, and resolve execution limitations that are blocking our ability to rapidly grow?
  • How can complexity be reduced to lower costs and grow the top line?
  • What changes should we make to our product and pricing strategies to align with our customer strategy?

P&C Identified the Client’s Core Strengths Before Articulating Its Performance Improvement Options

Appliance Retailer's Performance Improvement Boosts Shareholder Value

P&C Launched a Broad Performance Improvement Program for this Retail Client

Marketing/ Product Development
  • Consolidated and refocused marketing spend
  • Targeted programs b
  • segment to grow share of wallet and number of customers
  • Reprioritized R&D pipeline
Organization and Staffing
  • Restructured field front line management
  • Created performance management and incentive system
  • Optimized store level staffing by store type
  • Key driver of company store sales out-performance (~10% higher than retail industry average over multi-year horizon)
Sourcing
  • Centralized procurement function
  • Consolidated vendors
  • Re-negotiated contracts
  • Developed strategic supplier relationships
  • Drove $30M+ of annual savings after year one
 
Product Line Profitability
  • Assessed true profitability of all store level SKUs
  • Eliminated or re-priced 1000+ problem SKUs
  • Rationalized R&D Spending
  • Drove $11M of annual savings
Labour
  • Implemented store best practices
  • Enhanced store labor productivity by eliminating admin work
  • Increased store level automation
  • Saved $40M in annual labor staffing costs

 

Real Estate
  • Redefined store “full potential”
  • Assessed store portfolio and optimal real estate economics
  • Improved efficiency in leasing, construction and repair and maintenance
  • 20% annual R&M savings and a 5% increase in new store ROI
P&C’s performance improvement initiatives created $2.5 billion in shareholder value since the beginning of the relationship.

Further Reading

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