FMCG industry – how do companies adapt to the market?

Restructuring

The FMCG industry is trying to make up for the losses lockdowns caused in numerous European countries, while selling of consumer goods is massively moving to the Internet. According to OECD.com, “in the EU-27, retail sales via mail order houses or the Internet in April 2020 increased by 30% compared to April 2019, while total retail sales diminished by 17.9%”. Online commerce is booming and this trend is expected to continue after the pandemic.

The FMCG sector sees e-commerce tools as a new opportunity for development. According to Fieldcircle, companies are now investing in tools that will allow for live data analysis, sales volume prediction and estimation of missed opportunities. Modern technology is expected to facilitate the FMCG sector through:

These needs are mainly related to the optimization of company processes such as the search for financing or business partners, sharing confidential documentation in projects involving many parties and the remote work of enterprises. One of the solutions that meets these needs that are currently available is the Virtual Data Room system, which allows to shorten the time of procedure, reduce its costs and ensure information flow control - comments Dorota Wójtowicz, Senior Business Development Specialist at FORDATA.

Not only the e-commerce sector is gaining importance (online and mobile payments, marketing and analytical platforms that facilitate sales, etc.), but the entire infrastructure, including warehouse space and logistics.

FMCG - not all industries go through COVID-19 identically

Although the situation of producers and suppliers has been supported by the increase in online sales, some companies in the FMCG sector are not able to take full advantage of the benefits of e-commerce. Particularly, these are the producers and distributors from the food sector, who base their sales on catering, restaurants, hotels and the event industry – which all are still having a hard time coping with the effects of the pandemic. In the entire FMCG sector, especially small food producers have been badly affected by the effects of the lockdown.

The restructuring of the FMCG sector is therefore driven not only by the optimization and searching for new – mainly online – sales channels but also by enterprises’ strategic adaptation which results in taking up processes such as Due Diligence, audits and the sale of an enterprise. This process includes both “regular” consolidation processes as well as the distressed sale of companies which suddenly found themselves in an unexpected and tough situation, such as small local vendors.

Due to a reduced traffic and the introduced restrictions, many companies have faced the challenge of restructuring and are now looking for quick ways to get out of the situation, also through sales – comments Dorota Wójtowicz.

The unexpected situation faced by small suppliers – not only those intending to sell due to lost liquidity, but also consolidate – requires advisors involved in these processes to react quickly to the company’s needs in order to restore its functioning.

As a solution that helps improve operational efficiency, identify opportunities and establish supply chains, Virtual Data Room is one tool that will also support advisers and company owners in conducting the restructuring processes faster

FORDATA VDR system can be launched in just 15 minutes without any implementation and provide support to companies wishing to share confidential company documents with outside parties, e.g. auditors or potential investors. The platform can be used for 1 month, which is a great advantage in the case of projects of small volume and short duration, such as the sale of a family business. There are many companies on the market that are potentially at risk and in which succession has not been established. Shortening the sales process in their case means lower costs of proceedings.

Fast and hassle-free restructuring

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