tendencies for the future of retail

1. Some
June 2015
Javier Perez de Leza
CEOFutureRetail
1

2. Javier Perez de Leza
CEO & Entrepreneur with 27 years worldwide experience.
Retail, FMCG, Hospitality. Board Advisor. Senior
Consultant. Internet expert.
Specialist in:
Business Strategy. Management. Marketing, sales and
Operations. New Business Development. Internet. Private
Equity, M&A and Restructuring.
Main accomplishments:
Successful Management expert who has led teams of up
to 25,000 members, while mentoring/assisting team
members in achieving a CEO position in other leading
companies.
Managed top companies (Metro, Costco, and Walmart) in
11 different countries.
Supervised investments in Europe, Latin America and
Asia.
Ample experience in Private Equity, M&A and
Restructuring.
2
Currently:
Compañía del Tropico http://goo.gl/3q5Fou
Board Member
The largest Cafeterias group in Spain with a network of more than 247 stores across the
Country. I was appointed by HIG capital as their Board Member. We are aiming to
double de size of the company in four years.
Bornay Desserts http://www.bornaydesserts.com/
Board Member & Share Holder
The oldest mid-size ice cream producer in Spain. Together with other two co investors,
we are taking in it out of receivership and considering a build-up project.
BodyBell www.bodybell.com/
Board Member
The leading perfumery chain in sales in Spain, with over 226 stores. Currently under
heavy restructuring.
Vitamin Well http://www.vitaminwell.se/es/
Board Member & Share Holder
Vitamin Well is a Swedish vitamin drink that leads its category in Europe. I have invested
in the Spanish branch in a start up face of the both the company and the category in
Spain.
Conde del La Monclova http://condedelamonclova.com/
Board Member
One of the Oldest Olive Oil `producers in Spain. I am helping to re-launch the brand.
WSI “We simplify internet” www.wsicorporate.com
Franchise Owner in Spain
WSI leads the global Internet industry offering best of breed Digital Marketing strategies
to suit the needs of multiple industries. I am running my own franchise.
Who is Javier Perez de Leza?

3. TRADITIONAL TRENDS
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Agenda
1. Organized HORECA industry tendencies.
2. Fast Moving Goods Industry trends .
3. My best practices as a Board Member.

4. TRADITIONAL TRENDS
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Organized HORECA industry tendencies

5. TRADITIONAL TRENDS
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Organized HORECA industry tendencies
• Restaurant architecture and design will embody both high-tech
advancements and low-tech hospitality.
• Combination of modern solutions like cashless payments as well as
the old-fashioned human touch.
• The lines between industry segments will blur further, with quick-
service chains adopting the upscale decor of casual-dining
competitors — localized through art and graphics — and full-service
and fast-casual brands adopting tools to speed up service.
• Quick-service restaurants will offer upgraded seating.

6. TRADITIONAL TRENDS
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Organized HORECA industry tendencies
• Continues efforts to reduce the costs and cut waste enhance
green credentials (investing in energy-efficient equipment
and materials)
• Advances in equipment and higher-quality prepared foods
from boutique manufacturers will allow restaurants to
reduce kitchen build-outs.
• As cleanliness and food safety draw more consumer
attention, microchip technology embedded in menus,
napkin dispensers and condiment service areas will alert
staff when they are near empty or need to be cleaned.
• The line between the front and back of the house will.
Customers will be seated in full view of the kitchen and
many concepts will add more tableside exhibition cooking.

7. TRADITIONAL TRENDS
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Organized HORECA industry tendencies
• The “green” halo will be a must: LED lighting, reduced-consumption
equipment, and savvy heating and air conditioning systems, they also will
recycle or compost all waste. And they will communicate that
environmental story to their customers.
• Provide support to the new technology, customers will not only ask for
free WIFI but for support to their electrical devices, from smartphones to
tablet computers, that demand charging, and even USB ports as an
amenity. With advances in voice recognition, drive-thru lanes will be
staffed by Siri-like software — not crew members — that will be able to
take orders in several languages. Digital ordering and payments will be
standard. “The smartphone will be the wallet of 2020.
• Electronic menus will be available with the tap of a finger, including links
to more information about the origins of the proteins and any local
ingredients and suppliers.
• Menus will be able to adjust their prices in real time, changing them daily
or even hourly by the penny, if they like.

8. TRADITIONAL TRENDS
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Organized HORECA industry tendencies
• Customizing the food to each customer’s individual likes. A
tap of the screen will change the menu to display only
vegan items, gluten-free items or both. Categories such as
appetizer or entrée will disappear as items become
sortable by the customer — by keyword, price, dietary
restrictions or whim — allowing customers to mix snack-
sized portions, small plates and large shared dishes as they
see fit.
• The emphasis on consistency in appearance among a
chain’s units will fade, restaurants will increasingly reflect
their local attributes. More local art and photography, and
regional architectural.
https://www.youtube.com/watch?v=DNz23XXLa1E

9. TRADITIONAL TRENDS
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Fast Moving Goods Industry trends

10. CONTINENT
FORMAT
PROFITABILITY
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Fast Moving Goods Industry trends

11. Retail Business Life Cycle
CONTINENT
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TRADITIONAL TRENDSFast Moving Goods Industry trends

12. Retail Business Life Cycle
FORMAT
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TRADITIONAL TRENDSFast Moving Goods Industry trends

13. Retail Business Life Cycle
PROFITABILITY
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TRADITIONAL TRENDSFast Moving Goods Industry trends

14. Retail Business Life Cycle
Wal-Mart Carrefour Costco Tesco
Sales (Billion$)
473.100 116.268 108.318 106.058
Stores
11.088 10.105 649 6.784
Countries present
27 34 9 13
Employees
2.200.000 364.795 186.000 597.784
%Sales out side home country
28,7% 52,8% 28,8% 39,8%
%EBITDA
7,5% 4,9% 3,8% 7,8%
Market value (Billion$)
238.790 21.703 54.567 24.373
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TRADITIONAL TRENDSFast Moving Goods Industry trends

15. Brand Value US $ Billion
1. Amazon.com, Inc. $37, 628
2. Wal-Mart Stores, Inc. $37,277
3. Tesco plc $21,834
4. Carrefour SA $13,754
5 eBay, Inc. $10,731
The Top 5 Most Valuable Global Retail Brands 2012
Retail Business Life Cycle
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TRADITIONAL TRENDSFast Moving Goods Industry trends

16. Future comes from smaller stores and internet
Wal-Mart Looks to Grow by Embracing Smaller Stores
and internet sales
• This year, for the first time in its history, Wal-Mart
will open more smaller grocery and convenience-
type stores than supercenters. At 10,000 to 40,000
square feet, its Wal-Mart Express and Neighborhood
Market concepts are a fraction of the size of a
200,000-square-foot superstore.
• Last year, Wal-Mart pulled ahead of Amazon in terms
of its web sales growth rate. According to data from
Internet Retailer, the chain's online sales in the year
ended January 31 rose 30% to $10 billion. Amazon,
by comparison, posted a 20% gain on $68 billion in
revenues from sales of electronics, media and other
products during the year ended Dec. 31Wal-Mart is testing smaller stores such as this
'Walmart To Go' in its hometown of Bentonville,
Ark. Wesley Hitt for The Wall Street Journal
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TRADITIONAL TRENDSFast Moving Goods Industry trends

17. “A” brands and Private label will continue to grow
• The recession served to intensify the dance, and private
label led for a time. Today, the choreography is more
nuanced, with “A” brands and private label each playing a
role in an elaborate show, and the consumer is at center
stage
• While some industry experts believe that private label has
“had its day,” IRI believes that private label and “A” brands
marketers can enjoy mutual growth by not simply co-
existing, but rather evolving and working together
• Consumers have embraced private label as a viable
money-saving option, yet “A” remain critical.
• Manufacturers and retailers must work together to
provide a balanced assortment of “A” and private label
solutions, targeted at the store level, to offer solid value
to key and high potential shoppers.
• There's is less and less space for “B” and “C” brands.
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TRADITIONAL TRENDSFast Moving Goods Industry trends

18. Fresh produce is a main driver in deciding where to shop
Read more: http://www.businessinsider.com/trends-that-are-
changing-grocery-stores-2014-4#ixzz3GnzavxPC• Fresh produce is a main driver for consumers in
deciding where to shop
• Seventy-five percent of consumers say the
produce department is the most important,
followed by fresh meat, poultry, and seafood
(60%); store brand products (36%); local farm
foods/produce (35%); and the in-store bakery
(29%), according to a Packaged Facts survey
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TRADITIONAL TRENDSFast Moving Goods Industry trends

19. Coming Crises In The Retail Market and subsequent opportunities
• You Will Replace Your Staff With Technology
• A recent paper by academics Carl Frey and
Michael Osborne affirmed what many have
already felt intuitively; that up to 47% of jobs in
the United States are at high risk of being
replaced by technology within a decade or two.
• Activities to be replaced: check out, inventory,
replenishment, cleaning, security, signaling and
price tags.
• Opportunity: Improve your Customer Experience
• Services with potential to be improved: Personal
shopper, fresh departments, merchandise
returns, merchandise carry/delivery. Other store
services.
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TRADITIONAL TRENDSFast Moving Goods Industry trends

20. Coming Crises In The Retail Market and subsequent opportunities
• People Will 3D Print What You Make
• The cost of a good, consumer-grade 3D printer has
rapidly scaled to under $2,000 and is surprisingly
simple to use
• 3D printing ‘app stores’, where people download files
for objects that can then be printed, could become as
popular as Apple’s iconic application store, according
to Paul Gately, the European head of 3D Systems.
• Opportunity: Incorporate it to your your Business
Model
• For example, Toy manufacturer Hasbro recently
announced a joint project with 3D printing
company Shapeways called SuperFanArt.com,
whereby select artists will create unique versions
of trademarked Hasbro designs, which fans can
then order and Shapeways will print.
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TRADITIONAL TRENDSFast Moving Goods Industry trends

21. Coming Crises In The Retail Market and subsequent opportunities
• People Will Share What and How You Sell
• The sharing phenomenon is now spreading across just
about every imaginable category of goods and
services
• You cannot stop your customers from talking about
you on social media. Good or bad, they will tell the
world of their experiences.
• Opportunity: Facilitate The Sharing Of What You Sell
• Customer relationships don't just happen from one-
time meetings at networking events. What you need is
a plan to make those connections grow and work for
you.
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TRADITIONAL TRENDSFast Moving Goods Industry trends

22. Coming Crises In The Retail Market and subsequent opportunities
• You Will Be Forced To Tell The Truth
• What you make, how you make it, who you hire and
how you treat employees - even your company’s
political leanings, are all becoming readily available
information via a host of online sites and mobile apps.
There simply are no secrets anymore and if there are,
they’re liabilities in waiting.
• Opportunity: Turn Honesty Into A Competitive
Advantage
• Explore the aspects of your company or that have
traditionally been obfuscated or held from public view
the risks and liability associated with those things
eventually being discovered. Now consider the
potential upside to your brand in being proactively
transparent on such issues.
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TRADITIONAL TRENDSFast Moving Goods Industry trends

23. Coming Crises In The Retail Market and subsequent opportunities
The Future of Retail - The Experience is Everything
VIDEO: http://goo.gl/wwOazB
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TRADITIONAL TRENDSFast Moving Goods Industry trends

24. Path to Prurchase
We know that ever-increasing numbers of consumers are going online to help their
shopping, whether it’s to speed up a transaction, research best prices or seek reassurance
that they are making the right choice.
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TRADITIONAL TRENDSFast Moving Goods Industry trends

25. Path to Prurchase
• However, it is not the same across all categories and brand owners need to think
carefully about the right approach to take to ensure that their digital strategy
doesn’t distract from sales.
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TRADITIONAL TRENDS

26. Big Data
• VIDEO: https://www.youtube.com/watch?v=wXkfrBJqVcQ
Cognitive Computing: 5 Future Technology Innovations from IBM
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TRADITIONAL TRENDS

27. Customer Segmentation is a must
SEGMENTATION
• Over the years, the practice of segmentation has evolved
along the type of customer information that is available.
In the 1950’s market segmentation was based purely on
demographic characteristics.
• As information technology evolved in the 1970’s,
segmentation not only included demographic data but
psychographic data as well.
• The growth of purchase-behavior segmentation arose in
response to this information flow, giving companies the
ability to segment customers based on their age, income,
psychographic profiles and past purchase behavior.
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TRADITIONAL TRENDS

28. Omni-channel
• The Omnichannel Shopper
• To turn one-time shoppers into life-long
customers in today’s retail environment, you
must first understand today’s shopper.
• Gone are the days when consumers completed all
of their shopping in-store, at the same few
retailers.
• Today, consumers have a plethora of options,
from where and when to shop, to whom with and
how often.
• In our omnichannel world, creating loyal
customers will come down to being relevant to
each shopper – whenever and however they
choose to interact with you, whether that’s in-
store, online, via email or on a mobile device.
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TRADITIONAL TRENDS

29. Omni-channel
• Globe Newswire: Only 5 Percent of Retail
Industry Has Fully Executed an Omnichannel
Strategy
• Survey Reflects Enormity of Change Required
and Need for Fundamentally New
Technology, Data Integration to Meet
Consumer Expectations
• "Omnichannel is about profitably building
the next generation of consumer experience,
and execution is apparently harder than the
ecosystem expected it to be," said Paula
Rosenblum, managing partner at Retail
Systems Research (RSR).
• From next-day delivery to in-store stock
visibility, retailers are disappointing
consumers with a mismatch of the services
they offer and the services customers
expect,
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TRADITIONAL TRENDS

30. FRESH FOOD HAS DIFICULTIES TO TRAVEL VIA INTERNET
• Food has been one of the last things to move online because
complex logistics for fresh, chilled and frozen products make it an
expensive business. Retailers are also reluctant to lose the
potential for the lucrative impulse buys that occur in-store.
• However, retailers in Europe and North America are now ramping
up their online food offer to compete with Amazon.com, which is
expected to expand its sale of fresh produce beyond a few trial
areas with the aim of complementing its non-food sales - and
eating other retailers' lunch.
• It has taken Tesco, Europe's second biggest retailer, 17 years to
bring its online grocery business close to the industry-leading
margins it used to make in its store business.Tesco made a trading
profit of 127 million pounds ($216 million) on online grocery
sales of 2.5 billion pounds in 2013, equal to an operating margin
of around 5 percent.
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31. Apple retail store
• Can Apple’s Success Be Emulated?
• The good design (airy interiors and attractive lighting,
a carefree and casual atmosphere); attractive
products (strong demand for the products) and focus
(a single brand with far fewer products) scale (only a
few hundred stores, and clever marketing (the Steve
Jobs factor).
• Yet firms that have tried to copy these features like
Best Buy and Microsoft, and had less success.
• This can lead analysts to throw up their hands and
declare that “it’s just magic!”, i.e. success that is
inexplicable by any rational process.
• 47,758 euros per m2
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TRADITIONAL TRENDSFast Moving Goods Industry trends

32. New technology in retail
• VIDEO: http://goo.gl/yqv3fU
• Interesting videos to be seen : “The Future in Store - Episode #1”
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TRADITIONAL TRENDSFast Moving Goods Industry trends

33. TRADITIONAL TRENDS
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My best practices as a Board Member

34. TRADITIONAL TRENDS
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My best practices as a Board Member
• One solution does not fit all. You should first find the strong and
weak points of the organisation in order develop your action plan.
Board Members are like doctors or medicine professors.
• Since we are a support to the CEO, knowing all key managers is a
must. To develop a good understanding of the business
development you should hear several opinions. The opinion of a
Board Member is only reflect to the CEO or other Board Members,
and never to the organisation.
• Visit company stores and competitors. Do it with management
and sometime unannounced and try to check if what you hear at
Board level is performed at floor level.

35. TRADITIONAL TRENDS
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My best practices as a Board Member
• Observe market tendencies and share them with the CEO
and the rest of the Board.
• Discussed company performance with the CEO continually.
Board meetings are the right place to officially agree the
company key decisions and not to discuss them.
• The key to understanding company figures is based on the
flow and not on a static view. The role of a Board member is
to help management anticipating tendencies. Management
is fighting the war day to day. The Board is like the Pentagon.

36. Coming Crises In The Retail Market and subsequent opportunities
• Survival Of The Fastest
• Every morning in Africa, a gazelle wakes up. It knows it
must run faster than the fastest lion or it will be killed.
Every morning a lion wakes up. It knows it must
outrun the slowest gazelle or it will starve to death. It
doesn’t matter whether you are a lion or a gazelle:
when the sun comes up, you’d better be running.
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TRADITIONAL TRENDS

37. TRADITIONAL TRENDS
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Questions and answers

38. TRADITIONAL TRENDS
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