What challenge(s) do our clients face?
An improper balance of speed of decision making due to lack of information and gaps in alignment between areas can drain money and morale impacting financial results.
For retail companies aiming to expand their footprint, having a clear and customer-focused growth strategy is essential. However, beyond definition, implementation is equally as challenging.
For companies pursuing an inorganic growth strategy, the identification and appraisal of worthy targets and ultimately the Post-Merger Integration (PMI) process becomes vital to success. On the other hand, for companies that decide to grow to expand their own operations, setting the right direction and ensuring alignment, coordination, and control of the day to day is essential to achieving positive financial results.
We see three common challenges our retail clients face when deploying and managing their expansion:
(1) Firstly, companies tend to underestimate the need to dedicate team and time to make growth happen. Expansion demands investment, not only financial but also in time and focus of the leadership and team.
(2) Secondly, companies often fail to sufficiently document the expansion process or governance to guarantee fast and precise decision-making. Many times the knowledge of the process is instilled in one person and there is centralization in decisions as well as the risk of losing expertise should they leave. The process from site prospecting to store opening is an arduous one as it involves many areas of the company.
(3) Lastly, given the number of stakeholders involved in the expansion process, there is often gaps in alignment and communication to guarantee visibility to all. Often key areas to the expansion (e.g. Operations, Legal, etc.) are not involved on the day-to-day, generating re-work and increasing risk and overrun.
How do we help?
Integration helps companies establish a solid foundation for consistent sustainable growth – structuring processes, ensuring visibility, control, speed, and alignment among areas, so no matter what the context, companies can adapt.
We are able to help our clients overcome these common challenges, and others involved in their Organic Growth Strategy implementation, through a holistic approach which strengthens your internal capabilities. We support you in translating strategy into execution through targeted and tailored actions across four levels:
- Strategy: Defining a clear growth strategy to guide the company and support expansion decisions.
- Process: Detailing the expansion process with clear deliverables, interdependencies, deadlines, and responsibles documented.
- Governance: Establishing a governance model for the different needs that aims to ensure control of the process, guaranteeing alignment between areas, problem-solving, and visibility for leadership decision-making.
- Organizational Structure: Ensuring well-defined roles and responsibilities between the different areas within the expansion process, as well as proper team sizing considering the client’s expansion strategy.
What are the benefits?
Acting simultaneously on these four levels allows our clients to lay solid growth foundations, giving the needed focus to its expansion and exploring the consequent benefits, such as:
- Revenue growth is driven by greater market coverage;
- Improved efficiency in expansion costs and timing driven by visibility and control of the process;
- Increased agility to respond to new customer needs and market niches, amplifying your reach;
- A clearer understanding of the growth strategy to be pursued;
- Improved buy-in and collaboration between all stakeholders involved in the expansion.
How does it work?
True collaboration, bespoke solutions and a focus on the future are key pillars for our delivery.
Across different industries, countries, and contexts, we have worked with our clients to truly understand their context and needs and equip them with the tools for continuous improvement and sustainable growth. So, no matter what the environment they face, they are able to adjust, learn, and execute appropriate growth strategies for the future.
To build up your expansion capabilities, we use a :
Along these three stages, we help you to tackle problems related to stakeholders’ involvement, execution speed, and information management while providing you tools to build up the needed capabilities, visibility and discipline to manage the expansion process.
One of the largest car rental companies, with operations across Latin America decided to redesign its expansion processes, structure, and governance to take advantage of the shift towards a sharing economy and reduced car ownership. The goal was not only to address current opportunities but also to lay solid foundations for the client to become a reference in organic growth.
Integration assisted the client in mapping the expansion process and how it intersected 23 business areas, structuring a governance model, and designing both expansion and maintenance areas. Using our proprietary methodology, we were able to bring the needed structure and speed to the process, guaranteeing alignment among all parties involved.
The new model resulted in a much more efficiency process and in just four months we supported the client in managing the opening of 80% of the points of sale planned for the year. The robust process promoted short-term results and also laid solid foundations for future growth.
After a few years without implementing any specific growth strategy, a Brazilian retailer decided to take advantage of the country’s recovering market and to expand its operations. An aggressive annual target of approximately 100 new stores in a year was established focusing mainly on small and medium-sized cities. This added a greater degree of complexity since the company operated mainly in large city centers.
Working with the client’s team, Integration assisted in designing the store opening process and restructuring the criteria used for choosing and approving the location of a new point of sale. With a clearer decision-flow and indicators that were able to translate the challenges and specificities of opening stores in small and mid-cities, we were able to bring consistency and speed on the approval of the expansion pipeline.
Until the client could establish its own team of PMOs, for 5 months we carried out the project management and during this period, opening targets were reached promoting revenue growth driven by the new points of sales.
A leading pharmaceutical retailer needed to structure its expansion process in order to guarantee its accelerated expansion plan and maintain market leadership. With an annual target to open approximately 150 stores, and specific monthly targets, the client hired Integration to support in the process to set solid foundations for its organic growth.
Integration assisted in three phases of the project: expansion process design and governance review, implementation, and further process optimization after a semester of the new process implementation. Firstly, we worked with the client team to map and document its expansion process involving more than 20 areas within the company (IT, Legal, Human Resources, Engineering, Sourcing, among others).
With a robust process designed and a management tool defined, we assisted in implementing new governance to sustain this process and to guarantee the speed and alignment among areas needed. Finally, after a period managing the process, we worked to optimize the process, making it more efficient.
The client achieved the expansion annual target and deemed the project a complete success. It has since become a reference case for PoS expansion in Brazil, with the retailer opening more than 200 stores per year since 2016.
Over the years, we have had the opportunity to support many retailers and services businesses to implement their Organic Growth Strategy. Working with companies from different sectors ranging from pharmaceuticals, supermarkets, and consumer electronics retailers to the gym and rental car chains has allowed us to gain in-depth knowledge of market dynamics and expansion specificities (licenses, timings, challenges, etc.) across several industry segments.
More specifically, through these experiences, our professionals have developed an understanding of local regulations concerning the opening of a new point of sale in the different Brazilian regions. This allows us to bring robust and customized solutions to our clients that take into consideration the market and geographical context.