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Consumer products companies continue to feel cost pressures.

Investors want to put their money in companies that are lean now and that have a plan to stay lean into the future.

Inflation in emerging markets means import commodity costs are rising. However, with slow annual GDP growth in North America and global economic uncertainty overall, these costs often can’t be passed on to the consumer.

In our survey, respondents cite availability and cost of raw materials as the biggest increase in risk over the next five years. In fact, 60% suggest that it will become increasingly necessary to secure a long-term supply of critical resources and commodities.

From a stakeholder perspective, investors continue to look for companies that operate as lean as they possibly can. They want to put their money in companies that are lean now and that have a plan to stay lean into the future.

Investment based on lean operations could drive increases in market capitalization and share price for the company.

 


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