It’s easy to say that change is the new normal, but that doesn’t make it any easier for companies trying to steer a path through the storm. According to our latest Workforce Hopes and Fears Survey, 66% of employees have experienced more change at work over the last year than in the previous year. In addition, over the next three years, 50% of Canadian CEOs believe technology changes will drive them to reinvent in the way their company creates, delivers and captures value. So, it is fair to say that more change is on the way and in an unprecedented pace. Navigating the path to success is particularly difficult for small and mid-sized businesses in the consumer markets space, where retail and consumer packaged goods (CPG) companies need to juggle an array of challenges, including rising costs, increasing changing geo-political circumstances affecting cross border trade, lack of access to affordable capital leading to slower adoption of new technologies and shifting market trends. Rapidly changing consumer demands are also driving these companies to find ways to become more transparent, more sustainable, and more socially responsible in order to build the trust they need to grow.
And that isn’t all. Even as they’re responding to these macroeconomic pressures, addressing emerging issues and trying to take advantage of new opportunities, retail and CPG companies need to manage their evolving talent requirements. A complex combination of shifting employee demographics and motivations, rising labour costs increasing labour shortage, and critical skills gaps related to innovative technologies is only making this task more difficult. They need to do more with less.
This is where solutions that are specifically designed for mid-size companies come into play. Companies across the consumer markets space—and beyond—are turning to these technologies to get the most out of their operations and to enable their people to drive more value and to make better and faster decisions.
Having robust core business operations—like finance, procurement and supply chain management—are table stakes for most companies in the consumer markets space today. By embracing a cloud enterprise resource planning (ERP) solution that can simplify, streamline and, to some degree, automate your core operational functions, you can improve the efficiency of your organization’s key back functions while enhancing your focus on the functional activities that truly will differentiate you from the competition.
In a short timeline, a scalable cloud-ERP solution can help growing retail and CPG companies modernize operations, boost efficiencies, and lay the groundwork for innovative tools like GenAI – all at a manageable cost.
Tackling big challenges
How a cloud-based ERP solutions can help small and mid-sized consumer markets companies thrive
Over 50% of Canada’s GDP is driven by small and mid-sized businesses, including those in the retail and CPG industries. These companies have equally complex businesses and intricate processes as their larger counterparts, especially if they have ambitious growth targets in Canada or in other markets.
As the factors affecting the long-term success of companies are changing on a near-constant basis, a robust ERP system can be a major differentiator for organizations looking to grow. For some companies, it can even be key to their survival. According to our Global CEO Survey, 35% of Canadian CEOs believe their businesses might not be viable in ten years, highlighting the critical need for business model reinvention.
The right ERP solution can give companies a strong foundation from which to reinvent their businesses so that they can embrace the technology advancements, operational efficiencies and innovations they need to thrive long-term.
Discovering value: See what this looks like in action
Dive into our use cases to see how SAP S/4HANA Cloud Public Edition can strengthen your small to medium sized retail and CPG business, helping you thrive and grow.
Five key areas where SAP S/HANA Cloud can help small and mid-sized businesses in consumer markets businesses thrive:
Spotlight on SAP S/4HANA Cloud Public Edition
SAP S/4HANA Cloud Public Edition is an ERP solution that gives small and mid-sized companies looking to grow the technology foundation they need to thrive. It provides companies with a structured ERP approach and a range of functional modules (e.g., finance, sales, procurement, supply chain) that are fully modular and scalable so that they can hit the ground running with essential core capabilities—like finance—and then add on additional modules over time as they are needed.
The value of SAP S/4HANA Cloud Public Edition for your Consumer Markets organization
Helping you maximize SAP S/4HANA Cloud Public Edition
When it comes to enabling growth, a robust ERP solution can be a real gamechanger. At PwC, we can help you get the most from SAP S/4HANA Cloud Public Edition so that you can be confident that you have the technology foundation you need to scale and grow effectively. Whether you are a new start-up looking to establish robust financial processes from the get-go or a growing business looking to make your end-to-end processes more streamlined and efficient, we can help.
Our value extends far beyond ERP implementation. We leverage our extensive experience working with SAP solutions, our deep knowledge of leading practices both functionally and at an industry level, and proprietary accelerators—such as Cloud ERP Express, which is focused on core finance processes—to enable you to get the most from your SAP implementation both immediately and incrementally.
How we can help accelerate your path to success
Assessing your existing operations and challenges.
Defining your cloud modernization approach and a roadmap for change.
Evaluating the value of GROW with SAP and/or other ERP solutions for your goals.
Select the right modules for maximum ROI.
Equip you with insights and tools to speed up your ERP implementation confidently.
Utilize proprietary accelerators, like Cloud ERP Express, Industry Edge, and CPG Industry Edge, to fast track your implementation.
Demonstrating the value of SAP S/4HANA Cloud Public Edition
Below, we highlight a number of retail and CPG use cases to illustrate how we can help companies get the most out of their SAP S/4HANA Cloud Public Edition implementation.
Retail use cases:
Challenge
A retailer that already uses cloud SAP recently acquired a new brand that has been heavily reliant on manual financial processes historically. The retailer wants to quickly improve efficiencies within the brand’s financial processes while also making them consistent with other parts of their business.
Solution
By implementing the SAP finance module of SAP S/HANA Cloud Public Edition using our Cloud ERP Express package, a new finance system is set up quickly and in a way that readily integrates within their larger SAP environment.
Our team would work with the retailer to understand their strategic objectives, identify their key value drivers and pain points, build a realistic roadmap that considers both their immediate and future needs, and implement the solution quickly and in a way that is fully scalable.
Impact
Gain visibility over the financial processes of the new brand quickly.
Achieve process efficiencies while reducing and, in some cases, eliminating manual effort.
Accelerate implementation using task automation, predefined reporting mechanisms and established processes.
Facilitate the use of consistent and comparable processes between existing brands and the new brand.
Establish the backbone needed to support retail sales process integration and real time reporting (e.g., margin, sales reviews).
Challenge
A retailer with both bricks-and-mortar locations and online sales wants to find efficiencies in their merchandising process, enable more customized pricing, and provide a consistent and seamless experience to its customers across channels (i.e., inventory visibility, pricing consistency).
Solution
Using SAP, the retailer can rapidly gain visibility into and improve their merchandising management processes—from assortment management and omnichannel pricing to merchandising analytics—while creating a more seamless customer experience.
Our team would help the retailer understand their current business processes and pain points and then leverage our deep knowledge of current and potential future business processes, the diverse retail market and customer buying trends to help them maximize value from their core merchandising functions and processes using SAP. We would also help the retailer understand how they could enhance the maturity of their merchandising processes and enable incremental value over time, both using SAP S/4HANA Cloud Public Edition modules and, if needed, additional tools or applications.
Impact
Enhance the maturity and responsiveness of merchandising processes.
Gain real time visibility into inventory to improve replenishment processes and reduce excess inventory.
Enable automation and analytics to better understand and respond to merchandizing trends.
Improve the customer experience across different buying channels.
Challenge
A retailer wants to improve its financial spend by putting better controls and guardrails in place to better manage its indirect procurement activities.
Solution
Using SAP, the retailer can leverage automation to improve processes and controls related to indirect procurement, so that they can better manage their expenses.
Our team would help the retailer not only move their procurement processes to SAP, but also help them understand leading practices around indirect procurement so that they can develop processes and controls that are clear and transparent, leverage existing contracts appropriately, and manage potential exceptions.
Impact
Obtain more visibility and granularity into both direct and indirect procurement.
Improve controls around financial spend and the effectiveness of expense management activities.
Enable procurement activities to leverage existing contracts and pricing where available.
Provide seamless integration between procurement and invoice management within finance.
Enable forecast-based replenishment and more efficient inventory management when paired with supply chain module.
Consumer packaged goods use cases
Challenge
A CPG company that sells both direct and through retailers wants to improve its pricing model to better incorporate distribution and supply chain costs based on whether their goods are being supplied directly to the buyer or retailer, warehouses, or distribution centres.
Solution
Using SAP, the CPG company can move away from a one-size-fits all pricing model; using the sales and supply chain modules within SAP, the CPG company can gain more visibility into their distribution costs, and build flexibility into their pricing model so that pricing better aligns with the buyer’s preferred delivery location or method.
Our team would work with the CPG company to understand how they can use SAP to not only gain better visibility into their end-to-end costs, but also to incorporate them into their pricing model and sales processes so that they can offer more competitive pricing options.
Impact
Gain transparency into the granular cost components of distribution in order to identify efficiencies.
Provide more competitive pricing that considers distribution costs based on delivery channel.
Support the identification of pain points to identify opportunities to improve efficiencies.
Challenge
A CPG company wants to improve efficiencies related to its trade management processes to enable contract terms to be followed, reduce penalties, and facilitate timely payment.
Solution
Using SAP, the CPG company can streamline how trade agreements are managed and controlled; the company can embed pricing details and specific requirements associated with different trade contracts into their core ERP system—which can, in turn, help drive efficiencies in accounts receivables by ensuring compliance with trade agreements.
Our team would work with the company to set up processes to incorporate trade agreement details into their ERP and to ensure appropriate controls are implemented to manage contract terms based on the company’s needs and on our familiarity with SAP, our extensive industry experience and our knowledge of leading practices.
Impact
Centralize trade agreement details in the core ERP so that related activities across functions adhere to requirements.
Leverage automation and technology controls to reduce manual effort related to reconciliations.
Reduce risk of potential penalties and/or delayed payments.
Improve accounts receivables processes and timing by reducing potential errors that would delay payment.
Challenge
A CPG company wants to integrate its production and manufacturing processes with the rest of its sales and distribution activities so that it can become more effective at planning, more efficient at procurement and replenishment.
Solution
By leveraging the core suite of SAP S/4HANA Cloud Public Edition modules—including Finance, Manufacturing, Procurement, Sales, Supply Chain—this company can significantly streamline their end-to-end processes and gain the transparency they need to align specific manufacturing activities (e.g., scheduling) to demand and become more efficient.
Our team would work with the company to understand their end-to-end processes, to identify their roadblocks to making their manufacturing and related processes more responsive, and help them structure their roll-out of different modules based on the ability to drive value quickly while laying the groundwork for incremental value to be achieved over time.
Impact
Gain visibility over their end-to-end operational processes and key dependencies.
Enable revenue optimization by improving forecasting, supply chain planning, production scheduling, and other processes.
Better understand pricing factors related to production and manufacturing in order to inform sales processes and trade agreements.
Ready to explore how your organization can thrive?
Connect with us for a 1:1 consultation where we’ll guide you through the next steps of your transformation and discuss what tools your company needs to thrive
Contact us
Partner, SAP Retail and Consumer Markets Leader, PwC Canada
Tel: +1 514 297 5610
Pinar Doğruer (“Doh-rare”)
Partner, Retail and Consumer, Consulting, PwC Canada
Tel: +1 416 687 8650