Gross Margin Improvement: Operational and Financial Analysis for a Consumer Brand
A leading consumer products supplement brand engaged Clarkston Consulting to complete an operational and financial assessment to identify and prioritize projects for gross margin improvement.
Over the past five years, the supplement market has undergone significant changes through product innovation, shifting consumer behaviors, and increased competition from multinational corporations. These evolving market dynamics have introduced cost pressures, compelling the company to focus on improving gross margin, optimizing profits, and reinvesting in the business to facilitate rapid growth.
Faced with uncertainty about which projects would yield the most significant financial impact, Clarkston Consulting conducted an assessment encompassing the company’s current plan of initiatives. Additionally, internal executive interviews were conducted to pinpoint gaps and opportunities, and the company’s current state was benchmarked against industry best practices.
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Clarkston Consulting identified immediate improvement opportunities and devised a series of medium and long-term strategies spanning various functional areas. This holistic approach triggered a thorough reevaluation of their operational framework, an expansion of their existing operational principles, and a more efficient utilization of their systems, all aimed at augmenting gross profit.
Thanks to the above steps, as well as through an exhaustive analysis of operational and financial metrics, the project culminated with quick wins and recommendations across multiple functions, including Supply Chain, Quality, Fulfillment, Production, Packaging, Facilities, and more.
Clarkston’s recommendations included a thorough identification and analysis of current and future projects, an exhaustive market scan that examined best-in-class nutritional and supplement companies, and additional gross margin improvement opportunities.
