Meat production doubled between 1988 and 2018 and increased 4 times compared to 1960, with only growth prospects in the future. By 2050, meat consumption is estimated to reach between 460 and 570 million tons per year. Compared to 2008, 570 million would mean a doubling of consumption.

We are talking about one of the categories in which there is the greatest competition and the smallest profit margins. Knowing this context, how can we help a meat production brand to optimize its portfolio and reach a double digit operational profit?

A commercial diagnosis is always the starting point in long range planning (LRP) programs, and this project benefited from a diagnosis on 4 critical dimensions, each of them being associated with 3 strategic priorities:

1. Commercial (intensive growth through KAM, extensive growth through increasing indirect distribution in certain channels, export partnerships)
2. Marketing (brand revamp through innovation/positioning/communication, differentiated proposals for retailer brands, frequent and loyalty promotional strategies)
3. Abattoirization (improvement of planning and allocation of resources, reduction of operating costs, participation in the innovation process)
4. Controlling and planning (correct definition of cost allocation rules + transparency in reporting, highlighting "profit opportunities" and "cost saving", leadership in planning and price strategy)

Analyzing each of the 4 dimensions, we arrived at the identification of growth barriers, structured in turn on 3 levels:

1. Organizational – structure and commercial capabilities
2. Structural (determined by the economic environment) - the unpredictability of the raw material and the competitive activity in retail
3. Conjunctural - accelerated development of private brands of retailers and increased competitiveness with reduced profitability.

Returning to the critical dimensions, in the first 2 - the commercial and marketing area - we carried out an exhaustive assessment through interviews with the commercial and trade marketing teams to understand what is the starting point and what type of effort is necessary to be able to move forward.

For the commercial policy, we analyzed a series of chapters with KPIs related to each of them, using the balanced scorecard methodology:

• Recommended portfolio/channel
• Execution per channel/segment
• Customer segmentation
• Pricing policy
• Promotional strategy
• Credit policy
• Service packages/customer segments
• Commercial contracts

For the same purpose, for the trade marketing dimension, we analyzed other chapters in order to identify nerve points and understand the level of effort required to grow. The elements evaluated through interviews according to the balance scorecard method were:

• execution of the brand in stores
• consumer/buyer activation actions
• planning at channel and customer level
• price/promotions/product strategy
• skills per role/function

Going further, we performed the same analysis for the marketing area, where we evaluated:

• market and consumer structure,
• brand positioning,
• the forecast for the next 3-5 years,
• strategic planning and marketing strategy,
• marketing objectives & KPI and the 4P mix,
• the innovation plan and marketing activities,
• budgeting of marketing activities,
• monitoring activities and KPIs

The results of the diagnosis of the commercial and marketing processes led to the identification of the nerve points in each function (commercial, planning, marketing) and the setting of directions for change.

One of these was the need to redesign an important part of the existing processes to better support the new growth model and strategic initiatives.

Other directions of change included:

1. Setting KPIs that help measure success on a specific project, the same for all functions involved in that project
2. Decentralization of decisions and the design of the governance structure and the systems that support it on critical business processes
3. Redesign of the routines associated with the main business processes (roles, objectives, agenda, decisions and expected results)
4. Establishing process managers and creating contexts that facilitate individual responsibility

Similarly, the same results of the diagnosis of the commercial and marketing processes led to the identification of some critical points in the investment policy, of which the largest share was a non-unitary price policy at the company level and reactive to the market.

Subsequently, the directions of change were established, which include, among others:

• Defining the annual investment strategy starting from the growth opportunities defined in the strategic route
• Optimizing and maximizing the impact of investments by consistently measuring ROI
• The redesign and reallocation of the cost structure

Putting together all the analyzes and their results, we determined which are the processes that must be defined for both demand-generation and demand-delivery, as follows:

1. 1. • Demand generation - back office processes (RTM, forecasting, promotion planning, pricing policy, and marketing processes (brand repositioning, product development, activity plan development)
      • Demand delivery – IKA processes (listing, annual negotiation, contract management, annual budgeting, promotion management, auctions), traditional trade processes (routing, contract management, annual budgeting), and export processes (customer recruitment, volume planning)

"The process of commercial, marketing and operational diagnosis is like an anamnesis accompanied by detailed clinical investigations for a diagnostic doctor. It highlights unseen injuries, identifies hidden opportunities and presents the path to increased profitability. For a meat producer, commercial and operational diagnosis opens the way to efficiency and innovation. Through careful analysis of processes and resources, we can eliminate losses (waste) and increase productivity, ultimately reaching cost optimization and an efficient strategic routing.

In addition, a long range planning process ensures companies that the strategies they develop today are prepared for the challenges of the next 2-5 years", says Polixenia Iordachescu, Managing Director of Growth Leadership Consulting, the first Romanian commercial consulting company that runs augmentation projects of business skills in international organizations on 4 continents.