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Consumer Business

Global powers of the
consumer products industry.
Thinking inside, outside, and all around the box

Contents
Global powers of the consumer products industry –
top 250 consumer products companies, fiscal 2006...........3
The value of intangibles: understanding Q ratio.............20
Trends in the consumer products industry .....................23
Consumer business contacts . .........................................27

Consumer Business 2| .

9% 4 Nestle SA Switzerland Europe Food. Even long-stagnant Japan experienced growth far better than in recent years.300 3. Russia. United States North America Electronic Products 42.1% 8 Toshiba Corporation Japan Asia/Pacific Electronic Products 60.080 4. Big emerging markets continued to experience rapid growth in consumer incomes.0% 28 L'Oreal SA France Europe Personal & Household Products 19.966 2. Netherlands Europe Electronic Products 33.551 8.680 10. Drink & Tobacco 35. United States North America Food. DT rank FY06 net FY06 net FY06 sales Company name Country Region Product sector (FY06) sales (US$mil) profits (US$mil) growth 1 Altria Group.340 12. Inc.767 4.1% 20 Tyson Foods. Ltd.1% 7 Sony Corporation Japan Asia/Pacific Electronic Products 64. Japan Asia/Pacific Electronic Products 35.590 8.1% 26 The Goodyear Tire & Rubber Company United States North America Tires 20.4% 6 The Procter & Gamble Company United States North America Personal & Household Products 76. Drink & Tobacco 78.185 3.888 6.657 5. fiscal 2006 Strong consumer spending drives growth In 2006.198 5.3% 13 Motorola. Incorporated United States North America Food.V.7% 25 Michelin Group France Europe Tires 20. Drink & Tobacco 40.685 5. with millions shifting from poverty to the middle class.9% 10 Nokia Corporation Finland Europe Electronic Products 51. thereby stimulating expanded spending. Japan Asia/Pacific Electronic Products 77.1% 5 Matsushita Electric Industrial Co.7% 27 Christian Dior SA France Europe Fashion Goods 20. one of the fastest rates ever recorded. Japan Asia/Pacific Food. United States North America Food.085 13. Ltd. the global economy was very strong.6% 14 Japan Tobacco Inc. India.748 4. Drink & Tobacco 21. Drink & Tobacco 24. United States North America Electronic Products 57.7% 21 The Coca-Cola Company United States North America Food.0% 24 Mars. Economically. Drink & Tobacco 21.642 7.3% 11 Unilever Group United Kingdom Europe Personal & Household Products 49.583 2.8% 15 Canon Inc.3% 22 Fujifilm Holdings Corporation Japan Asia/Pacific Electronic Products 23.545 4. Inc.485 20. United States North America Food. Global powers of the consumer products industry Global powers of the consumer products industry – top 250 consumer products companies.625 7.407 12. Drink & Tobacco 25. with global GDP rising an astounding 5.847 2.777 1.137 5.774 877 11.311 12.7% 16 PepsiCo...582 720 5.658 6.088 5. In many countries. China. this was a good time to be in the business of selling consumer products.3% 23 Imperial Tobacco Group PLC United Kingdom Europe Food.879 3.120 -233 4.6% 2 Hewlett-Packard Company United States North America Electronic Products 91.836 2. the UK.050 10.028 1.916 1. Korea (South) Asia/Pacific Electronic Products 90. Relatively rapid economic expansion took place in such disparate locations as Argentina.2% 9 Dell Inc.725 732 11.7% e=estimate |3 .000 e na 16.7% 3 Samsung Electronics Co.126 2.7% 18 Sharp Corporation Japan Asia/Pacific Electronic Products 26.826 1. the UK. Canada.559 -196 -1.661 21.818 403 4.4%. This was especially true in Australia. Drink & Tobacco 101. Inc. Germany.799 6.8% 19 Bridgestone Corporation Japan Asia/Pacific Tires 25.9% 17 Koninklijke Philips Electronics N.476 10. and the US.2% 12 LG Electronics Inc. Korea (South) Asia/Pacific Electronic Products 49.120 2.258 -330 2. elevated home prices added substantially to consumer wealth. Inc. and the US. Spain.865 8.420 2.

Drink & Tobacco 9.080 441 26.002 786 4.0% 74 Reckitt Benckiser plc United Kingdom Europe Personal & Household Products 9. Drink & Tobacco 12.437 467 13. Drink & Tobacco 12.4% 62 Fomento Economico Mexicano S.456 3.099 225 -0.000 e na 7.143 5. Japan Asia/Pacific Food.071 1.0% 55 General Mills.2% 38 NIKE.767 e 1. Drink & Tobacco 15.6% 60 ConAgra Foods.1% 54 adidas AG Germany Europe Fashion Goods 12. United States North America Electronic Products 19.007 3.917 287 4.964 -388 -7. Japan Asia/Pacific Home Furnishings & Equipment 18. Inc. United States North America Food. Drink & Tobacco 14.2% 69 Dean Foods Company United States North America Food.8% 50 Cadbury Schweppes plc United Kingdom Europe Food.004 1. Drink & Tobacco 17.350 318 16.718 2.121 -121 -8.0% 46 Kirin Brewery Company.. Drink & Tobacco 17.989 38.2% 39 Henkel KGaA Germany Europe Personal & Household Products 16.1% 57 Sara Lee Corp. Drink & Tobacco 12. Drink & Tobacco 9. Heinz Company United States North America Food. Drink & Tobacco 10. Drink & Tobacco 9.362 e 2. United States North America Food. Drink & Tobacco 9.252 e 50.5% 63 Tchibo Holding AG Germany Europe Food.9% 56 Asahi Breweries.422 na 21. Drink & Tobacco 12. Inc.A.J.1% 36 Kimberly-Clark Corporation United States North America Personal & Household Products 16.8% 68 BSH Bosch und Siemens Hausgerate GmbH Germany Europe Home Furnishings & Equipment 10.690 9. United States North America Food.883 21.238 1. Drink & Tobacco 10..775 554 6. Drink & Tobacco 11.0% 73 Vion NV Netherlands Europe Food.7% 53 The Pepsi Bottling Group.8% 64 Acer Incorporated Taiwan Asia/Pacific Electronic Products 11. Drink & Tobacco 18. United States North America Food.9% 61 Smithfield Foods.965 4.353 7. Inc. Mexico Latin America Food.774 4. Drink & Tobacco 14.782 743 5. Drink & Tobacco 10.747 1.028 765 3. Inc.242 17.004 7. Drink & Tobacco 12.0% 71 Ajinomoto Co.6% 42 Gallaher Group Plc United Kingdom Europe Food.717 1. Ltd.274 -601 -7.4% 59 Seiko Epson Corporation Japan Asia/Pacific Electronic Products 12.0% 52 Masco Corporation United States North America Home Improvement Products 12.Consumer Business DT rank FY06 net FY06 net FY06 sales Company name Country Region Product sector (FY06) sales (US$mil) profits (US$mil) growth 29 Coca-Cola Enterprises Inc United States North America Food.9% 45 Diageo plc United Kingdom Europe Food.483 752 2.6% 32 SABMiller plc United Kingdom Europe Food.6% 31 Sanyo Electric Co.5% 41 Altadis.8% 75 H.544 616 26. Inc.688 2.7% 35 Groupe Danone France Europe Food. United States North America Fashion Goods 16. Spain Europe Food.222 87 18.620 1.991 3.907 1. Drink & Tobacco 19.144 6. United States North America Food.668 623 52. Drink & Tobacco 11.A.326 1.B de C. Limited Japan Asia/Pacific Food.6% 44 Lenovo Group Limited Hong Kong Asia/Pacific Electronic Products 14.109 523 3.6% 33 Whirlpool Corporation United States North America Home Furnishings & Equipment 18. Japan Asia/Pacific Food.1% 47 Electrolux AB Sweden Europe Home Furnishings & Equipment 14.574 845 13.5% 51 Eastman Kodak Company United States North America Electronic Products 13.590 161 9. S. Ltd.1% 48 Svenska Cellulosa AB SCA Sweden Europe Personal & Household Products 13.960 8.7% 67 Kao Corporation Japan Asia/Pacific Personal & Household Products 10. Drink & Tobacco 15.V.7% 72 Groupe Lactalis France Europe Food. United States North America Food.442 1.4% 40 Anheuser-Busch Companies.3% 34 British American Tobacco plc United Kingdom Europe Food.147 15.354 e 1.2% 66 Associated British Foods plc United Kingdom Europe Food. Drink & Tobacco 13.730 522 7.315 1.1% 58 Colgate-Palmolive Company United States North America Personal & Household Products 12. Drink & Tobacco 16.804 -1. Drink & Tobacco 10.7% 70 Swift & Company United States North America Food.439 394 1.327 522 2.594 5.7% 30 Apple Inc.492 9.094 6. Drink & Tobacco 15.0% 65 Kellogg Company United States North America Food. Inc.707 639 -1.778 515 1. Inc.2% 49 Sony Ericsson Mobile Communications AB United Kingdom Europe Electronic Products 13.3% 37 InBev NV Belgium Europe Food. Drink & Tobacco 11.1% e=estimate 4| .860 1. Drink & Tobacco 14.278 504 7.679 1.3% 43 Heineken NV Netherlands Europe Food.911 167 4.671 14.

810 576 8. Drink & Tobacco 7.946 245 3.0% 107 Scottish & Newcastle plc United Kingdom Europe Food. United States North America Food.637 170 16. Italy Europe Food.2% 99 Yamazaki Baking Co.7% 91 Coca-Cola Greece Europe Food.9% 94 BenQ Corporation Taiwan Asia/Pacific Electronic Products 6.366 97 1.344 e na 18.210 3. United States North America Personal & Household Products 6.343 766 3. Drink & Tobacco 6.8% 82 Dr August Oetker KG Germany Europe Food.2% 97 CJ Corporation Korea (South) Asia/Pacific Food.055 429 17. Japan Asia/Pacific Leisure Goods 8.9% 105 V.764 12. Ltd. United States North America Leisure Goods 5.1% 110 Shiseido Company. Drink & Tobacco 5.118 6. Japan Asia/Pacific Electronic Products 5.6% 93 The Estee Lauder Companies Inc.051 1. United States North America Personal & Household Products 7.677 480 7.663 158 -1.A. Drink & Tobacco 8.492 89. United States North America Personal & Household Products 6.216 332 13. Mexico Latin America Food. Drink & Tobacco 5.5% 95 Carlsberg A/S Denmark Europe Food.133 558 2.745 286 6. Inc.705 e 12. Drink & Tobacco 6. Inc.4% 81 Nintendo Co.873 204 5.038 456 8.318 6.1% 115 Hormel Foods Corporation United States North America Food. Limited Japan Asia/Pacific Personal & Household Products 5.016 118 -3. United States North America Food. Inc..0% 119 Pilgrim's Pride Corp. Global powers of the consumer products industry DT rank FY06 net FY06 net FY06 sales Company name Country Region Product sector (FY06) sales (US$mil) profits (US$mil) growth 76 Fortune Brands.5% 83 Orkla ASA Norway Europe Food.2% 77 Avon Products. de C.081 -1. Drink & Tobacco 5. Drink & Tobacco 6.432 839 7.2% 101 Alticor Inc.236 -34 -7.171 -89 5. Drink & Tobacco 8.5% 111 TCL Corporation China Asia/Pacific Electronic Products 5.138 534 10.314 226 7.884 -467 -9.1% 79 Pernod Ricard France Europe Food. Drink & Tobacco 7.8% 113 Grupo Bimbo C. Drink & Tobacco 6.920 366 8.A. Drink & Tobacco 6. Drink & Tobacco 5.443 40 1.3% 121 Maple Leaf Foods Inc. Drink & Tobacco 8.6% 78 Reynolds American. Drink & Tobacco 7.200 9 -3.081 e na -8. Inc.4% 98 The Black & Decker Corporation United States North America Home Improvement Products 6. United States North America Food.C.845 377 6.0% 106 Ferrero S.p.136 e 641 e 5.783 -58 6.845 333 8. United States North America Personal & Household Products 8.6% 100 Beiersdorf AG Germany Europe Personal & Household Products 6. United States North America Food.9% Middle East 118 Casio Computer Co.201 385 8.5% 109 Meiji Dairies Corporation Japan Asia/Pacific Food..F.510 1. Drink & Tobacco 7.769 830 24.043 469 12.1% 89 Campbell Soup Company United States North America Food.3% 112 Royal Friesland Foods NV Netherlands Europe Food. Corporation United States North America Fashion Goods 6.300 e na -1.6% 87 Arla Foods amba Denmark Europe Food. Drink & Tobacco 6. United States North America Food.988 -833 28.447 486 -1.1% 108 Pirelli & C.5% 103 Compagnie Financiere Richemont SA Switzerland Europe Fashion Goods 6.192 e 1. Inc.1% 116 Mattel. Inc. Inc. SpA Italy Europe Tires 6. United States North America Personal & Household Products 7. Drink & Tobacco 5. Drink & Tobacco 5.650 593 9. Canada North America Food.6% 120 Constellation Brands. Ltd.413 1.1% Africa/ 117 Steinhoff International Holdings Limited South Africa Home Furnishings & Equipment 5.923 111 6.4% 86 Sherwin-Williams Company United States North America Home Improvement Products 7. Drink & Tobacco 6. United States North America Home Improvement Products 7. Inc. Inc.275 89 -3.274 1.500 e na 7. Drink & Tobacco 8.0% 104 Dole Food Company.906 456 19.6% 102 Newell Rubbermaid Inc.0% 84 Uni-President Enterprises Corporation Taiwan Asia/Pacific Food.9% 88 S.0% 96 Pioneer Corporation Japan Asia/Pacific Electronic Products 6. Drink & Tobacco 8.8% 90 Land O'Lakes. Johnson & Son.3% 85 Mohawk Industries. Ltd.8% e=estimate |5 .5% 114 Molson Coors Brewing Company United States North America Food. Drink & Tobacco 5.5% 92 Nikon Corporation Japan Asia/Pacific Electronic Products 7..2% 80 Nippon Meat Packers Japan Asia/Pacific Food.V. Japan Asia/Pacific Food. Drink & Tobacco 7. Drink & Tobacco 8. United States North America Food.

3% 158 Jarden Corporation United States North America Personal & Household Products 3.8% 161 TCL Multimedia Technology Holdings Ltd. Japan Asia/Pacific Food.2% 150 Gateway. Drink & Tobacco 4.875 245 5.894 e na -1.950 47 4. Inc. Drink & Tobacco 4. Drink & Tobacco 3. Drink & Tobacco 4.2% 162 Sapporo Holdings Limited Japan Asia/Pacific Food.8% 166 Miele & Cie. Drink & Tobacco 4.967 e 730 e 9..Ltd.1% 156 Groupe Terrena France Europe Food.317 -12 -2. Japan Asia/Pacific Tires 4.4% 149 Husqvarna AB Sweden Europe Home Improvement Products 3. de C. Mexico Latin America Food. United States North America Fashion Goods 4.944 559 2.0% 126 Morinaga Milk Industry Co. Drink & Tobacco 4.911 na -22.994 255 3.2% 157 The Swatch Group Ltd.742 20 -4.0% 125 Bacardi & Company.587 e 396 e 4.A.849 663 12.711 243 3.100 e na -2.1% 130 Parmalat Group Italy Europe Food. Hong Kong Asia/Pacific Electronic Products 3.7% 127 The Hershey Company United States North America Food.000 e na 19.6% 137 Grupo Modelo. Japan Asia/Pacific Leisure Goods 3. Japan Asia/Pacific Food.403 e 208 e -1.552 e 58 e 1. Drink & Tobacco 4.4% East 129 San Miguel Corporation Philippines Asia/Pacific Food.295 401 14.5% 142 Sony Bmg Music Entertainment United States North America Electronic Products 4.789 e 41 e 8. United States North America Fashion Goods 4. United States North America Electronic Products 5. United States North America Fashion Goods 4.847 501 4.758 -322 -10.S. Drink & Tobacco 3. Drink & Tobacco 3.P.6% 144 The Yokohama Rubber Company Limited Japan Asia/Pacific Tires 4.670 -144 -6.918 94 -2.8% 153 Q. Drink & Tobacco 4.0% 133 Wm.0% Africa/Middle 164 Vestel Elektronik Sanayi ve Ticaret A.4% 131 The Clorox Company United States North America Personal & Household Products 4. Corporation Japan Asia/Pacific Food.7% 143 Polo Ralph Lauren Corporation United States North America Fashion Goods 4.672 e 11 e 18.2% 154 Nichirei Corporation Japan Asia/Pacific Food.6% Africa/Middle 128 Arcelik Anonim Sirketi Turkey Home Furnishings & Equipment 4. Drink & Tobacco 3.4% 132 Yamaha Corporation Japan Asia/Pacific Leisure Goods 4.0% 138 Campina Melkunie UA Netherlands Europe Food.574 1.883 199 10. Switzerland Europe Fashion Goods 3.6% 147 Levi Strauss & Co.5% 155 Mccain Foods Limited Canada North America Food. Inc. Drink & Tobacco 3. S.593 244 4.885 251 11. United States North America Food./DE/ United States North America Electronic Products 3. Drink & Tobacco 3.0% 124 Liz Claiborne.741 762 5. Inc. Drink & Tobacco 4.V.3% 151 PepsiAmericas.3% e=estimate 6| .3% 146 The Stanley Works United States North America Home Improvement Products 4.1% 163 Foster's Group Limited Australia Asia/Pacific Food.1% 136 Skandinavisk Tobakskompagni A/S Denmark Europe Food.4% 160 Alberto-Culver Company United States North America Personal & Household Products 3.6% 141 Itoham Foods Inc.580 e 126 e -0.7% East 165 Nisshin Seifun Group Inc. Drink & Tobacco 3.2% 140 Hanesbrands Inc. Drink & Tobacco 4.1% 145 Bongrain SA France Europe Food.499 -96 15. Inc. Drink & Tobacco 3. United States North America Leisure Goods 4.686 529 12. Inc. Japan Asia/Pacific Food. KG Germany Europe Home Furnishings & Equipment 3.9% 167 Harman International Industries Inc.193 149 -0. Drink & Tobacco 4. Turkey Electronic Products 3. Limited Bermuda Latin America Food. United States North America Home Improvement Products 5. Company United States North America Food. United States North America Fashion Goods 4.930 208 1. Inc. Inc.108 338 -2. Drink & Tobacco 4.6% 152 Namco Bandai Holdings Inc.981 10 3.109 290 3.2% 123 Kohler Co.772 205 6.5% 139 Chiquita Brands International.846 106 20.6% 159 Fenaco Switzerland Europe Food.918 62 0.107 239 -1. Drink & Tobacco 3.1% 148 Hallmark Cards.995 258 2.972 158 6. Wrigley Jr.551 312 9.7% 134 Jones Apparel Group.9% 135 Sumitomo Rubber Industries Ltd.039 9.258 140 10. United States North America Electronic Products 3. United States North America Food. Drink & Tobacco 4.Consumer Business DT rank FY06 net FY06 net FY06 sales Company name Country Region Product sector (FY06) sales (US$mil) profits (US$mil) growth 122 Lexmark International.314 e na -13.578 e na 7.

Drink & Tobacco 3.989 79 30. United States North America Personal & Household Products 3. Drink & Tobacco 3.964 e na 16.9% 196 Ebro Puleva S. Global powers of the consumer products industry DT rank FY06 net FY06 net FY06 sales Company name Country Region Product sector (FY06) sales (US$mil) profits (US$mil) growth 168 The Schwan Food Company United States North America Food. Korea (South) Asia/Pacific Tires 3.371 51 3.426 1. & J.9% 204 Puma AG Rudolf Dassler Sport Germany Europe Fashion Goods 2. Drink & Tobacco 3.339 208 11..8% 182 RPM International Inc.985 685 6.2% Limited 188 SanDisk Corporation United States North America Electronic Products 3. Drink & Tobacco 2. Drink & Tobacco 2.331 213 6. Drink & Tobacco 3. of Zhuhai China Asia/Pacific Home Furnishings & Equipment 2.7% Charoen Pokphand Foods Public Company 187 Thailand Asia/Pacific Food. Inc.304 67 10.7% 208 Pactiv Corporation United States North America Personal & Household Products 2. Drink & Tobacco 2.350 e na 21. Ltd.400 e na 0.358 3.423 -543 -13. Drink & Tobacco 3.900 e na 11.331 110 7.0% 212 Citizen Watch Co.7% 199 Research In Motion Limited Canada North America Electronic Products 3.3% 191 Barilla G e R Fratelli SpA Italy Europe Food.091 72 4.326 150 9.396 -31 9. Drink & Tobacco 3.4% 198 Carolina Group United States North America Food. Drink & Tobacco 3. Japan Asia/Pacific Electronic Products 3. United States North America Leisure Goods 3.2% 206 E. Drink & Tobacco 3.3% 201 KT&G Corporation Korea (South) Asia/Pacific Food.258 201 41.917 274 5...176 -10 1. United States North America Personal & Household Products 3.1% 174 Del Monte Foods Company United States North America Food.7% East 186 Royal Numico N.5% 210 JELD-WEN.9% 175 Perdue Farms Incorporated United States North America Food. Ltd. Ltd.903 33 10. Drink & Tobacco 2. Drink & Tobacco 2.3% 189 Inventec Appliances Corp.379 416 11.1% 181 Montres Rolex SA Switzerland Europe Fashion Goods 3. Ltd.977 e na 12. Inc.235 e 63 e -12.1% 193 Hasbro. Drink & Tobacco 3. Drink & Tobacco 3.5% 202 Katokichi Co.0% 173 EMI Group plc United Kingdom Europe Electronic Products 3.200 na 10.415 113 13.976 334 33.5% 184 SEB SA France Europe Home Furnishings & Equipment 3.077 261 2.067 163 11. Drink & Tobacco 3.435 na -40.0% 179 Hankook Tire Co. Inc.8% 197 Nissin Food Products Co.500 e na 3.0% 200 Gree Electric Appliances. Italy Europe Food.459 na 5. Inc. Drink & Tobacco 3. Spain Europe Food.4% 203 D Swarovski & Co Austria Europe Fashion Goods 2. United States North America Leisure Goods 3.9% 177 Essilor International France Europe Personal & Household Products 3. Japan Asia/Pacific Food.1% e=estimate |7 .182 e na -2.056 760 5.8% 209 Cremonini S.7% Africa/Middle 185 Groupe ONA Morocco Food. Japan Asia/Pacific Food.0% 176 Funai Electric Co.3% 205 Ashley Furniture Industries. Drink & Tobacco 3. Netherlands Europe Food. Inc.7% B & C Tönnies Holding GmbH 169 Germany Europe Food.4% 172 Armstrong World Industries United States North America Home Improvement Products 3. Inc.979 e -79 e 2. Drink & Tobacco 3.A. Japan Asia/Pacific Food. Ltd.V. Gallo Winery United States North America Food. Ltd.9% und Company KG 170 Austria Tabak GmbH & Co KG Austria Europe Food. Drink & Tobacco 2. United States North America Home Furnishings & Equipment 2.7% 195 Energizer Holdings. Drink & Tobacco 3.1% 171 Red Bull GmbH Austria Europe Food.1% 180 Kikkoman Corporation Japan Asia/Pacific Food. Drink & Tobacco 3. United States North America Food. United States North America Home Improvement Products 2.A.897 111 6.363 177 9..151 230 2.076 226 3.321 255 31.0% 183 Coca-Cola Amatil Limited Australia Asia/Pacific Food.927 e na 8.430 na 28.037 632 47.361 107 9.p.917 -113 -4.1% 194 Electronic Arts Inc. United States North America Home Improvement Products 3. Taiwan Asia/Pacific Electronic Products 3. Drink & Tobacco 3.. Japan Asia/Pacific Fashion Goods 2.4% 190 Coty.0% 178 Meiji Seika Kaisha.4% 207 Interstate Bakeries Corp.5% 211 PT Gudang Garam Tbk Indonesia Asia/Pacific Food.878 62 0.9% 192 La Coop Federee Canada North America Food.

Japan Asia/Pacific Food.0% 214 Lion Corporation Japan Asia/Pacific Personal & Household Products 2.716 205 4. Inc.8% 220 Toyo Suisan Kaisha.8% East 237 GuangDong Midea Electric Appliances Co.3% 221 Toyo Tire & Rubber Co.5% 238 Valentino Fashion Group Italy Europe Fashion Goods 2.A.0% 229 Dairy Crest Group plc United Kingdom Europe Food. Drink & Tobacco 2. Inc.464 45 18. Ltd.652 105 7.676 -79 24.7% 222 ITC Limited India Asia/Pacific Food. Drink & Tobacco 2.400 57 1.4% 215 Coca-Cola West Holdings Company. Drink & Tobacco 2.809 139 -2.6% 239 Qingdao Haier Co.5% 234 Glen Dimplex Group Ireland Europe Home Furnishings & Equipment 2.5% e=estimate 8| .785 171 87. Ireland Europe Food.455 na 0.8% 226 Cooper Tire & Rubber Company United States North America Tires 2. Mexico Latin America Food. Ltd. Drink & Tobacco 2.400 e na -4.3% 216 Gruma S. Ltd.V.854 44 15. Ltd China Asia/Pacific Electronic Products 2. Inc. Ltd.0% 217 Techtronic Industries Co. Japan Asia/Pacific Tires 2. Ltd.Consumer Business DT rank FY06 net FY06 net FY06 sales Company name Country Region Product sector (FY06) sales (US$mil) profits (US$mil) growth 213 World Co Ltd.3% 235 Spectrum Brands.697 133 13.572 88 2.A. United States North America Fashion Goods 2.552 -434 10.8% 219 Videocon Industries Limited India Asia/Pacific Electronic Products 2.0% 249 Quiksilver..438 e na -4..6% Africa/Middle 236 Tiger Brands Limited South Africa Food.9% Triumph International 240 Switzerland Europe Fashion Goods 2.751 61 -1.608 93 12. Limited Japan Asia/Pacific Food.4% 218 Brown-Forman Corporation United States North America Food. Japan Asia/Pacific Fashion Goods 2. Japan Asia/Pacific Food.0% 231 Thai Beverage Public Company Limited Thailand Asia/Pacific Food.3% 243 PT Indofood Sukses Makmur Tbk. Japan Asia/Pacific Food.V.728 106 12. China Asia/Pacific Home Furnishings & Equipment 2.743 52 6. Drink & Tobacco 2. Indonesia Asia/Pacific Food.3% 246 Rich Products Corporation United States North America Food.2% 245 Perdigão S. Drink & Tobacco 2. Drink & Tobacco 2.2% 227 Ito En. de C.0% 232 Unicharm Corporation Japan Asia/Pacific Personal & Household Products 2. United States North America Home Furnishings & Equipment 2.2% 248 Snow Brand Milk Products Co..396 316 22. Drink & Tobacco 2.414 83 16.819 65 33. Drink & Tobacco 2. Brazil Latin America Food.741 598 26.806 390 14. Drink & Tobacco 2. Hong Kong Asia/Pacific Home Improvement Products 2. Drink & Tobacco 2.6% 224 McCormick & Company. Ltd.362 93 32.0% 230 Irish Dairy Board Co-operative Ltd. Drink & Tobacco 2.566 na 33. Inc. Netherlands Europe Home Furnishings & Equipment 2.7% 228 Hunter Douglas N.584 147 11.3% 223 Onward Kashiyama Co. United States North America Food.9% 244 Prima Meat Packers. Japan Asia/Pacific Fashion Goods 2.8% 225 The Scotts Miracle-Gro Company United States North America Home Improvement Products 2.6% 250 Sichuan Changhong Electronic Co.816 147 10. Drink & Tobacco 2.0% 247 Makita Corporation Japan Asia/Pacific Home Improvement Products 2. Drink & Tobacco 2.7% 233 Yves Rocher SA France Europe Personal & Household Products 2.532 356 12.405 25 -0.606 410 5. Ltd. United States North America Personal & Household Products 2.629 328 9.8% Vertriebsgesellschaft AG 241 Nordmilch eG Germany Europe Food. Drink & Tobacco 2.841 50 -0.4% 242 Furniture Brands International. Drink & Tobacco 2.466 197 13. Drink & Tobacco 2.529 96 -5. Ltd..355 38 24.418 55 1. Japan Asia/Pacific Food..374 69 -1. China Asia/Pacific Home Furnishings & Equipment 2.586 266 3.

106 Makita Corporation 247 Sara Lee Corp. 20 Company SA InBev NV 37 Pernod Ricard 79 Unicharm Corporation 232 Coca-Cola West Holdings Interstate Bakeries Corp.A.A. 176 Mattel. Company 133 Dairy Crest Group plc 229 Qingdao Haier Co. Ltd.V. Inc. 235 BSH Bosch und Siemens Gruma S. S. Ltd. 193 Nordmilch eG 241 Techtronic Industries Co. Ltd. 245 Vertriebsgesellschaft AG Coca-Cola Hellenic Bottling Imperial Tobacco Group PLC 23 91 Perdue Farms Incorporated 175 Tyson Foods.. Inc. Inc. Inc. de C. Inc. 122 Samsung Electronics Co. 40 Estee Lauder Companies Inc. Heinz Company 75 Swatch Group Ltd. Mohawk Industries.A. 178 Co. 120 Procter & Gamble Company 6 164 Japan Tobacco Inc 14 Ticaret A. 243 JELD-WEN. 244 Itoham Foods Inc. Corporation 105 Richemont SA Polo Ralph Lauren Corporation 143 Ito En.. 31 Apple Inc. 194 Levi Strauss & Co. 53 Toyo Suisan Kaisha. 41 EMI Group plc 173 Lexmark International. Inc. Limited 125 General Mills. 202 World Co Ltd 213 Dean Foods Company 69 Quiksilver. 212 Hershey Company 127 Pactiv Corporation 208 Tiger Brands Limited 236 CJ Corporation 97 Hewlett-Packard Company 2 Parmalat Group 130 Toshiba Corporation 8 Clorox Company 131 Hormel Foods Corporation 115 Pepsi Bottling Group. 55 Meiji Seika Kaisha.V 43 Onward Kashiyama Co. Corporation 153 Kao Corporation 67 Wm.. 17 E. Ltd. 217 Chiquita Brands International. 179 TCL Corporation 111 Nissin Food Products Co. S. 139 Heineken N. Inc.A. 12 San Miguel Corporation 129 Altria Group.. 1 Essilor International 177 Lion Corporation 214 SanDisk Corporation 188 Anheuser-Busch Companies. 16 Triumph International Coca-Cola Enterprises Inc 29 240 Perdigão S. 205 Foster’s Group Limited 163 Matsushita Electric Industrial SEB SA 184 5 Associated British Foods plc 66 Fujifilm Holdings Corporation 22 Co. 216 Nestle SA 4 Stanley Works 146 68 Hausgerate GmbH Grupo Bimbo C..V.V. Inc. & J. Inc. 190 PT Indofood Sukses Makmur Tbk. 228 PepsiAmericas.. 116 Sharp Corporation 18 Avon Products... Inc. Mars. 90 RPM International Inc. Ltd. 85 Snow Brand Milk Products Co. Global powers of the consumer products industry Top 250 consumer products companies alphabetical listing Acer Incorporated 64 Eastman Kodak Company 51 La Coop Federee 192 Royal Numico N. 150 Meiji Dairies Corporation 109 Sichuan Changhong Electronic 250 Bacardi & Company. 209 Puma AG Rudolf Dassler Sport 204 Jones Apparel Group. Svenska Cellulosa AB SCA 48 Nikon Corporation 92 Canon Inc. 38 Campina Melkunie UA 138 Appliances Co. 76 Masco Corporation 52 Scotts Miracle-Gro Company 225 Ashley Furniture Industries. Inc.. Inc. 152 Spectrum Brands. 30 Fenaco 159 L’Oreal SA 28 Sapporo Holdings Limited 162 Arcelik Anonim Sirketi 128 Ferrero S. 249 Kellogg Company 65 Yamaha Corporation 132 Del Monte Foods Company 174 Reckitt Benckiser plc 74 Kikkoman Corporation 180 Yamazaki Baking Co. 242 Mccain Foods Limited 155 Sherwin-Williams Company 86 B & C Tönnies Holding GmbH und Gallaher Group Plc 42 McCormick & Company. Ltd Seiko Epson Corporation 59 Austria Tabak GmbH & Co KG 170 Funai Electric Co. Ltd.. 102 Steinhoff International Holdings 117 Cadbury Schweppes plc 50 Grupo Modelo. Ltd. 137 Limited Nichirei Corporation 154 Campbell Soup Company 89 GuangDong Midea Electric Sumitomo Rubber Industries Ltd. Johnson & Son.Ltd. Inc. Inc. Ltd Barilla G e R Fratelli SpA 191 Glen Dimplex Group 234 Michelin Group 25 Skandinavisk Tobakskompagni A/S 136 Beiersdorf AG 100 Goodyear Tire & Rubber Company 26 Miele & Cie.A. 3 Alticor Inc. Ltd. 57 Arla Foods amba 87 Fomento Economico Mexicano Maple Leaf Foods Inc. 182 Ajinomoto Co. 207 215 Pilgrim’s Pride Corp. Inc..V.S. 223 Thai Beverage Public Company Christian Dior SA 27 231 Henkel KGaA 39 Orkla ASA 83 Limited Citizen Watch Co. Inc. Cooper Tire & Rubber Company 226 PT Gudang Garam Tbk 211 Jarden Corporation 158 Videocon Industries Limited 219 Coty. Inc. 93 Liz Claiborne. Inc. Inc. Ltd 81 Carlsberg A/S 95 Hallmark Cards.. Ltd. Inc. 124 Sanyo Electric Co. 71 Electrolux AB 47 Lenovo Group Limited 44 S.V. 224 Shiseido Company. 141 Vestel Elektronik Sanayi ve Constellation Brands.p. Inc.. 195 LG Electronics Inc. 123 Dr August Oetker KG 82 Rich Products Corporation 246 Koninklijke Philips Electronics N. 196 Land O’Lakes.. 134 Whirlpool Corporation 33 D Swarovski & Co 203 Q. 13 Communications AB Brown-Forman Corporation 218 Groupe Terrena 156 Namco Bandai Holdings Inc. Inc. Ltd.F. 227 Valentino Fashion Group 238 ConAgra Foods. Ltd.. Inc. Ltd. 157 Nintendo Co. Inc. 165 Casio Computer Co. Inc. Ltd. 239 Katokichi Co. 210 Vion NV 73 Cremonini S. Incorporated 24 Scottish & Newcastle plc 107 Asahi Breweries. 220 Coca-Cola Amatil Limited 183 Hunter Douglas N.p. Hasbro.A. Inc. Inc. 147 SABMiller plc 32 Altadis. Limited 110 169 Company KG Gateway. Inc.. 60 Prima Meat Packers. Inc. de C. 113 Newell Rubbermaid Inc. 230 84 Corporation Compagnie Financiere ITC Limited 222 Pirelli & C. 221 Coca-Cola Company 21 Husqvarna AB 149 PepsiCo. Inc. de C. 148 Swift & Company 70 Nippon Meat Packers 80 Carolina Group 198 Hanesbrands Inc 140 Tchibo Holding AG 63 Nisshin Seifun Group Inc. Limited Inventec Appliances Corp. 88 Alberto-Culver Company 160 Electronic Arts Inc. 78 Yves Rocher SA 233 Kohler Co. Inc. 151 Toyo Tire & Rubber Co. Inc. Inc.A.P.A. Inc. 121 Schwan Food Company 168 62 Armstrong World Industries 172 S. 126 Sony Ericsson Mobile 49 British American Tobacco plc 34 Groupe ONA 185 Motorola. SpA 108 103 V. Wrigley Jr. 77 Furniture Brands International. 56 Fortune Brands. 189 Colgate-Palmolive Company 58 Pioneer Corporation 96 Uni-President Enterprises Irish Dairy Board Co-operative Ltd. Ltd. Ltd.B de C. Inc 104 Reynolds American. Ltd.. KG 166 Smithfield Foods. 119 Unilever Group 11 Company. 61 BenQ Corporation 94 Gree Electric Appliances. Gallo Winery 206 KT&G Corporation 201 Royal Friesland Foods NV 112 |9 .J. 15 H. 135 237 NIKE. Ltd.A. 197 Charoen Pokphand Foods Public Harman International Industries TCL Multimedia Technology 187 167 Nokia Corporation 10 161 Company Limited Inc. Inc. 186 adidas AG 54 Ebro Puleva S. Limited 46 Limited Dole Food Company. Inc. 101 Energizer Holdings.C. 99 Dell Inc. 9 Red Bull GmbH 171 Kimberly-Clark Corporation 36 Yokohama Rubber Company Diageo plc 45 Research In Motion Limited 199 144 Kirin Brewery Company. Ltd. 118 Hankook Tire Co.V./DE/ Holdings Ltd. Ltd.V. 248 200 Black & Decker Corporation 98 of Zhuhai Molson Coors Brewing Company 114 Sony Bmg Music Entertainment 142 Bongrain SA 145 Groupe Danone 35 Montres Rolex SA 181 Sony Corporation 7 Bridgestone Corporation 19 Groupe Lactalis 72 Morinaga Milk Industry Co.

Kraft. geographies have helped to keep these companies on top.5% 6. Consumer it from the declining US tobacco business.7 17. Drink & Tobacco 101.7% 6.1% 13.1% 4 Nestle Switzerland Food. on average. Profitability was down slightly largest consumer products company in 2006.5% 7 Sony Japan Electronic Products 64. Private label at least $2.7% 1.453 8.6%. Total sales for the Top 250 consumer products companies exceeded $2.0% 9. However.407 3.1% of total Top 250 net sales. product integrity issues. net profit margin for the 221 companies that disclosed their net income/loss figures was 6.6% 5 Matsushita Japan Electronic Products 77. this has from the prior year when the average net profit margin was already changed as the tobacco giant spun off its Kraft Foods 6.7% 1. the financial period covered billion in fiscal 2006.1% 10.3% 2.2% TOP 250 2.7% 2.966 2.2% TOP 10 751.9% 9. strategic companies.674. 24 (or 11%) Altria Group (formerly Philip Morris Companies) was the world’s recorded a net loss in fiscal 2006.0%.8% 7.5%.476 12. Despite the challenges noted above. with company will drop well out of the Top 10. diminishing returns on new product development.6% 6 Procter & Gamble United States Personal & Household Products 76.0% a year earlier.7% 9 Dell United States Electronic Products 57.1% and only half as many companies were unprofitable.4 3.6% 4. a modest decline from 6.1 15.0% 11. division in March 2007.Consumer Business Despite the positive economic environment. when listed as a separate company.3%. 2006 DT rank Net sales Y-o-Y sales Net profit Financial Company name Country Product sector ROA ROE (FY 06) (US$mil) growth margin leverage 1 Altria United States Food.1% 1.420 2.67 trillion in 2006.0 18.1 16.8 5. return on assets averaged 5. slightly ahead of the 8. ongoing restructuring and streamlining measures Top-line gains translated into solid profitability for most compa- have helped maintain their ability to react quickly to market nies in 2006.551 5.9% 4. strong A look at the leader board consumer spending resulted in healthy growth for the industry’s The ten largest companies reported combined sales of $751 Top 250 companies in fiscal 2006.1% 1. At the same time.1% 1.4% 2.7 billion.7% 8 Toshiba Japan Electronic Products 60. Altria also plans to spin Consistent with that finding. not every company enjoyed strong growth. the average trends while cutting costs.9% off its fast-growing Philip Morris International arm to separate in 2006. innovative However.658 5. the consumer To join the ranks of the Top 250 required fiscal 2006 sales of products industry faces enormous challenges. Nevertheless.5% pace for the Top 250.9% 4. variety of growth strategies to achieve their current stature.6% 2.4 28. rising commodity prices.3% 10.5% 2. This in this report.6% 10.1 10. group grew sales 8.7% 10 Nokia Finland Electronic Products 51.1% 3.4% 8.9 59. Drink & Tobacco 78.7 21. will very likely place among the Top 20.5% 7.0% 5. The average year-over-year These consumer products powerhouses have relied on a growth rate for the group was a robust 8.6% 7.2% 3 Samsung Electronics Korea (South) Electronic Products 90.1% 10 | . and declining productivity of traditional marketing programs are just some of the issues putting pressure on the industry.602 8.2% 2.777 13. an average financial leverage ratio of 4. or 28.36 billion. This resulted in average return on equity of 18.5% 10.6% 12. and entry into high-opportunity in fiscal 2006. or 16% of the Top 250.7% 3. $10.625 8.2% 2 Hewlett-Packard United States Electronic Products 91. The average size for the group was competition. Market-leading brands favored by the big retailers.916 12.0 times (total assets / stockholders equity). Forty-one products that offer unique consumer benefits. Global top 10 consumer products companies.9 18. Of these companies.3% Economic Concentration of Top 10 28.6% 19. at which point the products companies were fairly highly leveraged in 2006.657 20. a rather alarming statistic. experienced declining sales acquisitions and partnerships.2% 2.3% 1.9 36.1% 5.

1% 8.0% 0.3% products. now leads the pack.3% $10. especially given that these companies’ the slimmest profit margins.032 3. Their share of Top 250 companies was Nestlé’s relatively strong growth vs.1% P&G. which is home to 70 Top 250 firms. on average. 2006 in number and size.3% 6. ranks 6th among the leader group. In 2006. 7. Share of top 250 companies Share of top 250 sales US companies dominate by country/region.6% $11. and Toshiba Performance by region/country. UK consumer electronics maker Matsushita — moved Nestlé up one companies are the biggest. Asian companies. as consumers. Dell hung onto 9th place despite disappointing sales and Region/ Average net Average net Average size Average earnings in 2006. As a result.0% $3.3% also lagged their European and Latin American counterparts in terms of profitability.4% Germany 13. with the exception of Toshiba and Dell. came country # Cos.7% Germany America 4. Drink & Tobacco companies on by French companies.2% $11. the Top 250 250 8. Seven of the Top 10 companies are electronics manufacturers. Japan is home to three of the world’s top consumer electronics companies: Matsushita (#5). but Canada Africa/Middle East Canada Africa/Middle East 1.3%.142 6.9% Lat America 6 8.4%.3% brands.820 3. Strong 2. $15 billion in 2006.4% acquisitions.397 6.4% $11. particularly those based in Japan.2% Other 4.363 7.1% 8. This is partly because many of these sales figures include products and services for businesses as well companies operate in the low-margin electronics business.0% $15. Nokia.4% 1.952 8.2% growth was propelled by German and UK-based firms.4% compares N America 94 7.7% terms of sheer number. Global powers of the consumer products industry Altria is one of only two Food. the ninety-four North Japan Japan American firms (90 from the US) dominate in 19.7% favorably with 6.0% aggressive brand rationalization with a focus on billion-dollar France 11 7.4% 6.0% 9.4% 9. Latin 14.9% 3. but the region experienced the lowest average 2006 sales USA USA 36.9% Top 250.7% $5.6% 0. UK 13 10. HP (#2) German companies stand out for their high return on assets.4% 6.3% Other growth. fifth-place holder — more than double their share of Top 250 sales volume.4% The Top 10’s average net profit margin of 7. has been followed by Europe 70 9.6% 8. Sony (#7).698 5. the world’s largest supplier of personal & household Asia/Pac 75 8. This translated US 90 7.9% saw sales rise 9.743 10.6% 21. but dragged down somewhat | 11 . Companies in the Africa/Middle East region the Top 10 leader board.6% 2. closely followed by South Korea’s Samsung almost double the average ROA for all Top 250 firms. With its 2002 acquisition of Compaq. 2006 (#8).5% 6. sales growth profit margin (US$mil) ROA on strong to finish in the #10 spot. Nestlé occupies the #4 spot.0% Other 38. A series of Japan 49 7.4% Europe Europe Europe.075 6. including Gillette in 2005. However.775 8. reported This is not surprising.7% performance lags By geographic region.4% UK America UK 5.7% $7.0% $10.1%. with average sales in excess of place from where it would have been positioned in 2005.5% 9. The world’s reported the highest average sales growth in 2006 at 14.5% $10.7% into higher return on assets and higher return on equity vs. Electronics.0% for the group as a whole.2% 7. the leader group was less highly leveraged.4% $11. smallest. on average.4% 3. France France Other 4.6% five years. North American companies Asia Pac Asia Pac 10. Africa/ME 5 14. 2006 by country/region. the world’s top cell phone maker.311 6.0% Latin 2. P&G has nearly doubled in size in the past Germany 10 11. largest food company recently became even larger with the Companies from Africa/Middle East and Latin America are the acquisition of Gerber Products in September 2007.

The largest company in this region is Switzerland’s Nestlé (#4 overall). Drink & Tobacco and Electronic Products sectors. The smallest of this group ranks 26th overall among the Top 250.407 Hewlett-Packard 2 2 Electronic Products United States 91. None are from the Home.258 The Top10 North American companies are all US-based.088 Mars 9 24 Food. 2006 Company name North Am rank Top 250 rank Sector Country FY06 net sales (US$mil) Altria 1 1 Food.120 Japan Tobacco 6 14 Food.916 LG Electronics 5 12 Electronic Products Korea (South) 49. Drink & Tobacco United Kingdom 18.028 Michelin 6 25 Tires France 20. 2006 Company name Europe rank Top 250 Rank Sector Country FY06 net sales (US$mil) Nestle 1 4 Food.476 Dell 4 9 Electronic Products United States 57.420 Motorola 5 13 Electronic Products United States 42.137 Tyson 7 20 Food.777 Toshiba 4 8 Electronic Products Japan 60. Luxury goods provider Christian Dior is the only Fashion Goods company in the Top 10 in any of the regional groups.725 Fujifilm 10 22 Electronic Products Japan 23. Fashion or Leisure sectors.120 L'Oreal SA 8 28 Personal & Household Products France 19.657 Unilever 3 11 Personal & Household Products United Kingdom 49. Drink & Tobacco United States 35. Drink & Tobacco United States 25. Drink & Tobacco United Kingdom 21. Top 10 European consumer products companies.991 The Top 10 European consumer products companies are fairly dispersed geographically. The highest-ranked consumer products firm elsewhere in the world is Mexico’s #62 ranked FEMSA (Fomento Económico Mexicano). Drink & Tobacco Switzerland 78.748 Sharp 8 18 Electronic Products Japan 26. Top 10 North American consumer products companies.582 Christian Dior 7 27 Fashion Goods France 20. but dominated by British and French companies. Eight of these companies are from the Food.799 Philips 4 17 Electronic Products Netherlands 33. while two are headquartered in South Korea. 12 | .551 Matsushita 2 5 Electronic Products Japan 77. the largest beverage company in Latin America.836 SABMiller plc 9 32 Food.658 Procter & Gamble 3 6 Personal & Household Products United States 76.620 BAT 10 34 Food.888 Imperial Tobacco 5 23 Food.818 Eight of the Top 10 Asia/Pacific companies are based in Japan. Drink & Tobacco United States 21.000 e Goodyear 10 26 Tires United States 20. 2006 Company name Asia/Pac rank Top 250 rank Sector Country FY06 net sales (US$mil) Samsung 1 3 Electronic Products Korea (South) 90. Drink & Tobacco United States 101. Drink & Tobacco United States 24.966 Sony 3 7 Electronic Products Japan 64.559 Coca-Cola 8 21 Food. Top 10 Asia/Pacific consumer products companies. All but two of these companies — Japan Tobacco and Bridgestone — are electronics manufacturers. Drink & Tobacco United Kingdom 17.Consumer Business Top consumer products companies by region The Top 10 companies in North America.625 Nokia 2 10 Electronic Products Finland 51.774 Bridgestone 9 19 Tires Japan 25.879 PepsiCo 6 16 Food. Europe and Asia/Pacific are all positioned among the top 34 consumer products companies globally. Drink & Tobacco Japan 40.826 Canon 7 15 Electronic Products Japan 35.

Drink & Tobacco Mexico 2. Drink & Tobacco Mexico 4.816 Perdigão 6 245 Food. Other than FEMSA. Global powers of the consumer products industry Top Latin American consumer products companies. 2006 Company name Latin Am rank Top 250 rank Sector Country FY06 net sales (US$mil) FEMSA 1 62 Food.532 Africa/Middle East.574 Gruma 5 216 Food. Drink & Tobacco Brazil 2. the smallest region in terms of number of companies and average size. based in South Africa. Drink & Tobacco Bermuda 4. and Turkish appliance manufacturer Arçelik.344 e Arcelik 2 128 Home Furnishings & Equipment Turkey 4. 2006 Company name Africa/ME rank Top 250 rank Sector Country FY06 net sales (US$mil) Steinhoff International 1 117 Home Furnishings & Equipment South Africa 5. The top two are home furnishings & equipment manufacturers: Steinhoff International. four of which are based in Mexico. Drink & Tobacco Mexico 5. lists five companies. none rank among the 100 largest consumer products companies. drink & tobacco sector. All six companies operate in the food.672 e Groupe ONA 4 185 Food.326 Tiger Brands 5 236 Food.400 Latin America has six companies among the top 250. e=estimate | 13 .845 Bacardi 3 125 Food. Drink & Tobacco Mexico 11. Top Africa/ME consumer products companies.574 Grupo Bimbo 2 113 Food. Drink & Tobacco South Africa 2.885 Vestel 3 164 Electronic Products Turkey 3. Drink & Tobacco Morocco 3.967 e Grupo Modelo 4 137 Food.

7% $5.031 0.7% 9. the Products Fashion Products Products slowest of all the product sectors.7% Home Improvement Products 13 8.9% • Tires Food.8% $5. Drink & Tobacco 122 5.5% 6.8% 7.1% • Home improvement Personal & Hshld.3% • Food. This sector. in 2006.8% 6. drink & tobacco is dominant product sector For analytical purposes. Both also posted above-average profitability. as well as consumer. the largest product group — home to by product sector.8% • Electronic products Fashion Goods 20 12.5% • Fashion goods Food.640 7.Consumer Business Food. 15 12.3% $23.499 2.8% Leisure 11.7% $9.5 Goods billion.9% -0.5% beverage makers.5% $10. posted strong growth. 2006 almost half of all Top 250 companies.414 7. than Food.6% Products 3.3% 3.1% $4. in large part. Products 27 8.9% • Home furnishings & equipment Leisure Goods 7 15. with a negative average net profit margin.701 7.5% 8. with 27 companies. the leisure goods sector enjoyed the strongest growth in 2006.2% fact that these companies’ total sales figures include significant enterprise. sales.1% Fashion groups.2% Goods 2. 2006 companies have been organized into eight Average net Average net Average size Average # Cos. the Top 250 Performance by product sector.486 4.047 9. drink & tobacco Home Furnishings & Equipt. major product sectors: sales growth profit margin (US$mil) ROA Electronic Products 37 12. Drink companies in any of the other product & Tobacco & Tobacco 48. The two homegoods sectors also posted solid gains. by Share of top 250 companies Share of top 250 sales far.8%. Among the eight product groups.1% $11.5% 32. on average. followed by fashion goods.8% Electronic Improvement growth of 5. Drink Food.5% 8. Only the tire group. Food Personal & Personal & processors comprise the largest subgroup Household Tires Household Tires Products 3. drink & tobacco companies are.4% in this sector with 85.000 6.2% 7. This huge sector reported sales Home Products Home Improvement 14. on average. Companies in this group tend to be above-average in size. 5. but profit margins in this intensely competitive industry sector were slim.6% • Personal & household products Top 250 250 8. and 13 tobacco Goods Electronic Goods 2. grew on a par with the Top 250 overall. The personal & household products sector. represented by 37 companies. This is due.6% tend to be far larger. but average profit margins were significantly higher for the home improvement group compared with the Home furnishings & equipment companies. the Leisure group’s result was heavily skewed by Nintendo’s rapid sales growth. However.8% 1.698 5.3% 3.0% $10. followed by 24 Leisure 10.0% Home Home Furnishings Furnishings Companies selling electronic products & Equipment & Equipment 6.0% 3. to the 4.2% companies. 2006 by product sector. 14 | . had worse profitability.8% • Leisure goods Tires 9 8. with an average size of $23.6% $6.8% 41.

2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Procter & Gamble 1 6 United States North Am 76.551 Matsushita 3 5 Japan Asia/Pac 77. the top 10 electronic products companies look very much like the overall top 10 list.677 P&G leads the personal & household products group by a significant margin. Motorola and Canon.657 LG Electronics 8 12 Korea (South) Asia/Pac 49. drink & tobacco companies.826 PepsiCo 4 16 United States North Am 35. Top 10 food.008 Imperial Tobacco 7 23 United Kingdom Europe 21.000 e Coca-Cola Enterprises 9 29 United States North Am 19. followed by Unilever.625 Japan Tobacco 3 14 Japan Asia/Pac 40. drink & tobacco group rank from first place to 32nd place among the top 250. All of the top 10 electronics companies are among the top 15 largest consumer products companies worldwide.748 As most of the top 10 largest companies are consumer electronics manufacturers. Top 10 personal & household products companies. HP.120 Motorola 9 13 United States North Am 42.559 Coca-Cola 6 21 United States North Am 24.071 Avon 10 77 United States North Am 8. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Hewlett-Packard 1 2 United States North Am 91.476 Unilever 2 11 United Kingdom Europe 49.658 Samsung 2 3 Korea (South) Asia/Pac 90.004 SCA 6 48 Sweden Europe 13.137 Tyson 5 20 United States North Am 25.804 SABMiller 10 32 United Kingdom Europe 18.420 Nokia 7 10 Finland Europe 51.747 Henkel 5 39 Germany Europe 16. Nine of the top 10 are based in Europe or North America.916 Dell 6 9 United States North Am 57. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Altria 1 1 United States North Am 101.620 The top 10 companies in the food. the highest ranking company in this group.238 Kao 8 67 Japan Asia/Pac 10. Four of the top 10 are drinks manufacturers. Six are from the US. are LG Electronics. and three make tobacco products.799 L'Oreal 3 28 France Europe 19.966 Sony 4 7 Japan Asia/Pac 64.836 Kimberly-Clark 4 36 United States North Am 16.879 Canon 10 15 Japan Asia/Pac 35. Global powers of the consumer products industry Top 10 electronic products companies. e=estimate | 15 . three are food companies. is in a tight race with Samsung.782 Colgate-Palmolive 7 58 United States North Am 12.544 Reckitt Benckiser 9 74 United Kingdom Europe 9.407 Nestle 2 4 Switzerland Europe 78. In addition to the electronics companies represented in the overall Top 10.777 Toshiba 5 8 Japan Asia/Pac 60.028 Mars 8 24 United States North Am 21.

Christian Dior. Top 10 home improvement products companies.670 Hanesbrands 8 140 United States North Am 4.120 NIKE 2 38 United States North Am 16. NIKE and adidas – reported 2006 sales in excess of $10 billion.810 Black & Decker 4 98 United States North Am 6.331 Gree Electric Appliances 9 200 China Asia/Pac 2.994 Jones Apparel Group 7 134 United States North Am 4. All ten companies are based in Europe or North America (7 are from the US). e=estimate 16 | .989 Ashley Furniture 10 205 United States North Am 2.885 Miele 7 166 Germany Europe 3. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Christian Dior 1 27 France Europe 20. followed closely by Whirlpool. On average. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Masco 1 52 United States North Am 12.447 Kohler 5 123 United States North Am 5.964 Whirlpool 2 33 United States North Am 18.109 Husqvarna 7 149 Sweden Europe 3. Only three of the Top 10 companies in this sector – Dior.080 Electrolux 3 47 Sweden Europe 14. Sweden’s Husqvarna is the only non-US representative among the top 10 in this sector.900 e The home improvement products arena is dominated by US companies.295 Levi Strauss 10 147 United States North Am 4.578 e SEB 8 184 France Europe 3.326 adidas 3 54 Germany Europe 12. these companies tend to be relatively small.426 RPM 9 182 United States North Am 3.906 Sherwin-Williams 3 86 United States North Am 7.437 Steinhoff International 5 117 South Africa Africa/ME 5.Consumer Business Top 10 fashion goods companies. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Sanyo 1 31 Japan Asia/Pac 18. Top 10 home furnishings & equipment companies.344 e Arcelik 6 128 Turkey Africa/ME 4. ranked 31st overall. This is a much more geographically diverse group.109 BSH 4 68 Germany Europe 10.192 e VF 5 105 United States North Am 6. with companies from four regions.403 e Polo Ralph Lauren 9 143 United States North Am 4. Sanyo.778 Mohawk 2 85 United States North Am 7.668 Richemont 4 103 Switzerland Europe 6. ranks 27th. The largest.138 Liz Claiborne 6 124 United States North Am 4. is the sector leader.339 JELD-WEN 10 210 United States North Am 2.107 The fashion goods sector (primarily apparel and footwear manufacturers) lists 20 companies.000 e Stanley 6 146 United States North Am 4.964 e Household appliance makers dominate the home furnishings & equipment top 10.995 Armstrong 8 172 United States North Am 3.

081 Sumitomo Rubber 5 135 Japan Asia/Pac 4. Top tire companies. Global powers of the consumer products industry Top leisure goods companies. with 7 and 9. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Nintendo 1 81 Japan Asia/Pacific 8. Michelin and Goodyear are running neck-and-neck in second and third place respectively.258 Pirelli 4 108 Italy Europe 6. followed by toy maker Mattel.258 Hankook Tire 7 179 Korea (South) Asia/Pac 3. Nintendo is the largest company in the Leisure sector.363 Toyo Tire & Rubber 8 221 Japan Asia/Pac 2. Asian companies account for more than half of the tire makers on the top 250 list.711 Hallmark 4 148 United States North Am 4.743 Cooper Tire & Rubber 9 226 United States North Am 2.091 The leisure goods and tires sectors have the fewest firms on the top 250 list.676 Japan’s Bridgestone leads the pack in the tire category and ranks 19th overall. 2006 Product sector Company name Top 250 rank Country Region FY06 net sales (US$mil) rank Bridgestone 1 19 Japan Asia/Pac 25. with $20+ billion in sales — far ahead of the next biggest competitor. Italy’s Pirelli.930 Hasbro 6 193 United States North Am 3.725 Michelin 2 25 France Europe 20. e=estimate | 17 .593 Yokohama Rubber 6 144 Japan Asia/Pac 4.151 Electronic Arts 7 194 United States North Am 3.582 Goodyear 3 26 United States North Am 20. All of the companies in this small group are based either in Japan (electronic toys & games) or the US.274 Mattel 2 116 United States North Am 5.100 e Namco Bandai 5 152 Japan Asia/Pac 3. ranking 81st overall. respectively.650 Yamaha 3 132 Japan Asia/Pacific 4.

Royal Numico.39% 15 67 Kao Corporation Japan Personal & Household Products 10.906 19. iPhone).27% 28 85 Mohawk Industries.037 47. grew sales 25%.989 30.344 18.544 26. From a product perspective.767 50. In addition. Both of the India-based manufacturers on the Top 250 list are among the Fastest 50. These findings point to Reebok in 2006). Inc.422 20. 50 fastest growing consumer products companies 2005-2006 Growth Sales 2006 net sales YOY % sales Company name Country Major product sector rank rank (US$mil) growth 1 81 Nintendo Co. United States Food. Apple (iPod. Drink & Tobacco 9.321 31.668 51. nearly one-third of the UK firms made hand-held video game industry.V. Drink & Tobacco 18.19% 20 226 Cooper Tire & Rubber Company United States Tires 2. iTV. the most over-represented. Inc.396 22.54% 14 171 Red Bull GmbH Austria Food.657 20.362 32. reversing a long decline in the Taiwanese firms.83% 16 222 ITC Limited India Food. Inc.741 26.846 20.42% 29 123 Kohler Co. Ltd Japan Leisure Goods 8.64% 24 13 Motorola. Fashion Good companies also have a including the 2nd fastest-growing company. China Electronic Products 2. on average.33% 9 204 Puma AG Rudolf Dassler Sport Germany Fashion Goods 2. income to spend on homegoods and apparel. Drink & Tobacco 2.67% 12 200 Gree Electric Appliances. Drink & Tobacco 2.29% 10 249 Quiksilver. the two home-related sectors are Acquisitions boosted sales for many of the Fastest 50. sales surged 45. Growth for the Top 10 largest companies. The company has seen strong the list of fast-growing companies.05% 30 117 Steinhoff International Holdings Limited South Africa Home Furnishings & Equipment 5.5% iTunes. three times the Top 250’s 8.28% 18 250 Sichuan Changhong Electronic Co.819 33.97% 26 158 Jarden Corporation United States Personal & Household Products 3.18% 21 247 Makita Corporation Japan Home Improvement Products 2. as would be expected.315 38.879 21. was 8. United States Fashion Goods 2.430 28. and Whirlpool a growing middle class around the world with more disposable (acquired Maytag in 2006). rapidly.54% 19 76 Fortune Brands.96% 3 49 Sony Ericsson Mobile Communications AB United Kingdom Electronic Products 13.2%. United States Home Improvement Products 7.78% 4 199 Research In Motion Limited Canada Electronic Products 3.258 41. Drink & Tobacco 8.080 26. among others. SanDisk (flash memory products).Consumer Business Fastest 50 target emerging markets A focus on innovative new products also resulted in strong growth for companies like Research In Motion (Blackberry In 2006. United States Electronic Products 42. Inc.93% 18 | .20% 22 181 Montres Rolex SA Switzerland Fashion Goods 3.. as Number one-ranked Nintendo made great progress expanding are three of the five Chinese companies and two of the four gaming to the masses in 2006.00% 5 188 SanDisk Corporation United States Electronic Products 3. United States Home Improvement Products 5. rate.65% 11 186 Royal Numico N. Drink & Tobacco 3.6%. the 50 fastest-growing consumer products companies wireless devices). Netherlands Food.620 21. Glen Dimplex. Ltd.350 21.274 89.976 33.80% 2 54 adidas AG Germany Fashion Goods 12.988 28. Geographically.355 24.65% 7 234 Glen Dimplex Ireland Home Furnishings & Equipment 2. United States Electronic Products 19. Inc. adidas (acquired disproportionate share of the Fastest 50. Limited Japan Food. Drink & Tobacco 3. and Red Bull (energy drinks).000 19. companies based in emerging markets grew by comparison.82% 23 32 SABMiller plc United Kingdom Food. performance of both Nintendo DS and Wii.32% 13 94 BenQ Corporation Taiwan Electronic Products 6.60% 25 72 Groupe Lactalis France Food.33% 8 215 Coca-Cola West Holdings Company.34% 17 33 Whirlpool Corporation United States Home Furnishings & Equipment 18. of Zhuhai China Home Furnishings & Equipment 2.566 33.676 24.61% 27 10 Nokia Corporation Finland Electronic Products 51.26% 6 30 Apple Inc.769 24. Looking only at the top 10 fastest-growing companies.

Incorporated United States Food. are on the final products. Drink & Tobacco 2. therefore. OneSource. They do not reflect results consumer brands. Drink & Tobacco 9. Companies whose primary business is the sale of consumer OANDA. Drink & Tobacco 4. not weighted averages. Indonesia Food.350 16. United States Food.89% 49 225 The Scotts Miracle-Gro Company United States Home Improvement Products 2. Net Sales for non-US companies were converted to US for this analysis.78% 35 91 Coca-Cola Greece Food. Inc. Indofood Sukses Makmur Tbk. Factiva. Drink & Tobacco 3. 10-Ks. data for prior periods (i. and Forbes Largest fiscal 2006 sales were derived from consumer products versus Private Companies list. The list excludes contract manufacturers — that may have been restated by a company in subsequent periods.49% 36 243 PT.295 14. The fiscal 2006 Growth rates and other financial ratios.47% 42 139 Chiquita Brands International.24% 40 64 Acer Incorporated Taiwan Electronic Products 11. which may include sales of commercial and fiscal year was used to convert that company’s results to US dollars. For analysis purposes. Japan Fashion Goods 2.07% 44 213 World Co Ltd. a company must first be designated data was taken directly from annual reports.806 14.688 15. Each company was or other company-supplied information sources.S.785 15. as this In order to provide a common base from which to rank the industry is not relevant to the vast majority of the target audience companies. Drink & Tobacco 6. press releases.e.697 13.055 17.222 18.03% 41 50 Cadbury Schweppes plc United Kingdom Food.67% 38 97 CJ Corporation Korea (South) Food.00% 34 74 Reckitt Benckiser plc United Kingdom Personal & Household Products 9.499 15. were calculated definition encompasses fiscal years ended through June 2007. Drink & Tobacco 2.23% 43 219 Videocon Appliances India Electronic Products 2. Broadly defined. as a manufacturer (primary SIC code 20-39). Turkey Electronic Products 3.65% 47 37 InBev NV Belgium Food. however.637 16.68% 33 73 Vion NV Netherlands Food.414 16. Drink & Tobacco 16. have an impact on the results.93% 37 24 Mars. Drink & Tobacco 21.000 16. data averages in this report are simple companies — and includes only the companies whose brands arithmetic averages.43% 39 205 Ashley Furniture Industries. To be considered for this list. Whenever possible.86% 32 164 Vestel Elektronik Sanayi ve Ticaret A. Global powers of the consumer products industry Growth Sales 2006 net sales YOY % sales Company name Country Major product sector rank rank (US$mil) growth 31 239 Qingdao Haier Co.672 18. dollars. organizations that make products under contract for other Unless otherwise noted.854 15.com was the source used for the exchange rates. Drink & Tobacco 13. It also excludes motor vehicles.17% 48 174 Del Monte Foods Company United States Food.466 13.. Inc. | 19 .415 13. Drink & Tobacco 7.718 14.62% Study methodology and data sources A number of sources were consulted to develop the top 250 list and the other tables and charts in this report. these products are marketed under well-known been recorded as originally published. fiscal 2005) have Generally.. in the companies’ local currencies. these are products produced for and purchased by the ultimate consumer. United States Home Furnishings & Equipment 2. Amadeus. Ltd. China Home Furnishings & Equipment 2. Other sources then analyzed in an attempt to determine if the majority of its include Hoovers.464 18.01% 45 218 Brown-Forman Corporation United States Food.84% 50 238 Valentino Fashion Group Italy Fashion Goods 2.81% 46 143 Polo Ralph Lauren Corporation United States Fashion Goods 4.071 17. The products were included among the Top 250 based on their total average daily exchange rate corresponding to each company’s fiscal 2006 Net Sales. Exchange rates.964 16. commercial or industrial products. industrial products as well as consumer products.

This is not surprising as these companies depend on such intangibles as brand. innovation. and the US have high commoditization. The problem with commoditization is that it leads to margin-killing price competition. characterized by price pressure. To calculate the Q ratio. 20 | . are owned or leased. there are significant individual in the market value assigned by financial markets. and so on. on average. or over whether processes are performed the company could be acquired and the assets could be sold off in house or are outsourced. The only way to avoid this is to create a compelling brand. As such. low average Q ratios. on average. the exceptions to these averages. the strength of their brands. This entails innovation in design and technology. the ratio can provide some for a profit. and tire companies are low. we took market • Interestingly. they are not necessarily convinced that a brand is differentiated from its competitors simply on the basis of good quality. closeness to the consumer. These strengths are critical in an environment have higher Q ratios than companies in other regions. clever marketing. and Companies based in the UK. On the other hand. producers of consumer goods fight a constant battle against commoditization. ratio of market capitalization to assets. and market • O  n average. dubbed the Q ratio by the Nobel-prize winning economist James Tobin. and a better consumer experience. a company’s statement of assets. Those with low market values have October 8. 91 companies had Q ratios less than one. the value is captured relatively low ratios. This is a tall order. We have done this for the 190 other hand. differentiated. If the Q ratio is less than Differences between companies can arise over whether assets one. but companies that can do this achieve pricing power. The value of such attributes is not reflected in Q ratios while companies based in Japan have. capitalization (share price times number of shares) as of on average. this implies that there is an arbitrage opportunity. 190 companies is 1. consumers have come to expect high quality and low prices.51. and done other things necessary to maintain pricing power and avoid commoditization. clearly differentiated products. Deloitte has chosen to measure the Q ratio for the world’s leading and tobacco sector have relatively high Q ratios. indication of the degree to which companies have successfully branded. companies that are Our analysis of the world’s leading consumer product companies large in terms of revenue do not. companies based in North America and Europe leadership. Instead. Due to advances in manufacturing technology and the ubiquity of discount retailers with low-priced private label goods. drink. In theory. have Q ratios yields some interesting insights. high Q ratios. the world’s • T he two companies on the list with the highest Q ratios leading consumer product companies generate about a third of (Research in Motion and Apple) are those with very high- their financial market value from non-tangible assets such profile. Of the 190 companies. Naturally. Germany. 99 had Q ratios greater than one while The importance of the Q ratio should not be overstated. home publicly traded companies on our list of the top 250 consumer improvement. companies in the personal and household product sector and the food. different countries and in different sectors: innovation. product companies. branded and are clearly differentiated from competitors. and higher market capitalization. On the consumer product companies. Still. and excellence in brand management. As a result. It would be useful to observe the gains to shareholder value There are differences between the Q ratios of companies in that emanate from such non-tangible assets as strong branding. average Q ratios for home furnishing. In addition. innovative technologies that have been successfully as brand. higher margins. private label competition. innovated. The composite Q ratio for all significantly different than companies with low revenues. better returns to shareholders. is a good indicator • C  ompanies in the leisure sector have the highest average Q of the ability of a company to generate shareholder value from ratios. first mover advantage. In other words. differentiation. companies with high market capitalizations have. on average. 2007 divided by reported assets for fiscal year 2006.Consumer Business The value of intangibles: understanding Q ratio In today’s business environment.

Drink & Tobacco 3. Switzerland Fashion Goods 3. Ltd Japan Leisure Goods 5.58 Large Country Q ratio France 1. Drink & Tobacco 4.44 Revenue Size Q ratio Germany 1.14 Bottom 25 1.160 Avon Products.979 Reckitt Benckiser plc United Kingdom Personal & Household Products 3.800 Tiger Brands Limited South Africa Food.86 Tires 0. Drink & Tobacco 1. Company United States Food.955 The Coca-Cola Company United States Food.941 Wm.47 Bottom 50 0.990 Beiersdorf AG Germany Personal & Household Products 3.78 Bottom 25 0.539 KT&G Corporation Korea (South) Food. Drink & Tobacco 3.77 Latin America 1.94 Top 50 1.31 North America 1.36 Japan 0.945 Nintendo Co.54 Home Improvement Products 1. United States Electronic Products 8.72 Top 10 1. Inc. Wrigley Jr.71 Bottom 10 1. Drink & Tobacco 2.V.177 Puma AG Rudolf Dassler Sport Germany Fashion Goods 3.593 L'Oreal SA France Personal & Household Products 2. Drink & Tobacco 2.80 Top 50 1.854 Electronic Arts Inc.91 Top 25 1.04 Leisure Goods 3.98 Europe 1. United States Personal & Household Products 3. Global powers of the consumer products industry Top 25 companies by Q ratio Company Name Country Major Product Sector Q Ratio Research In Motion Limited Canada Electronic Products 21..018 PepsiCo.547 Essilor International France Personal & Household Products 3.798 Brown-Forman Corporation United States Food. Drink & Tobacco 3. Drink & Tobacco 2.445 Composite Q Ratio Region Q ratio Market Cap Size Q ratio Africa/Middle East 1. Drink & Tobacco 6.54 USA 1.35 Asia/Pacific 0.34 Fashion Goods 1.530 The Hershey Company United States Food.40 Product Sector Q ratio Bottom 50 1.504 Colgate-Palmolive Company United States Personal & Household Products 4. Inc.330 The Swatch Group Ltd.60 Home Furnishings & Equipment 0. United States Food.088 Compagnie Financiere Richemont SA Switzerland Fashion Goods 3.64 | 21 . United States Fashion Goods 2.93 Top 25 1. Drink & Tobacco 2. Netherlands Food.93 Electronic Products 1.48 UK 1.487 ITC Limited India Food.17 Bottom 10 0.052 Royal Numico N.115 Nokia Corporation Finland Electronic Products 4.46 Food. Drink & Tobacco 3.046 NIKE.302 Carolina Group United States Food. United States Leisure Goods 3. Inc.00 Personal & Household Products 1.12 Top 10 2.322 Apple Inc.

3.85 Namco Bandai Holdings Inc. 8.36 Colgate-Palmolive Company 4.79 Canon Inc.55 PepsiCo.33 Reckitt Benckiser plc 3. 3.98 Nokia Corporation 4. Wrigley Jr. 1.13 British American Tobacco plc 2.87 Molson Coors Brewing Company 0.37 Hankook Tire Co. Ltd. 0.49 Beiersdorf AG 3.12 L'Oreal SA 2. Inc.Consumer Business Top 5 Q ratio by region/country Asia/Pacific France UK Company Q ratio Company Q ratio Company Q ratio ITC Limited 6.53 Groupe Danone 1.33 adidas AG 1..19 The Yokohama Rubber Company 0.8 The Scotts Miracle-Gro Company 1./DE/ Whirlpool Corporation 0. de C.5 Electronic Arts Inc.26 Colgate-Palmolive Company 4.32 Hunter Douglas N.03 S.03 SEB SA 1.12 The Coca-Cola Company 4. Ltd 5.A. 0.74 Cooper Tire & Rubber Company 0. de C.18 Yamaha Corporation 0.02 Essilor International 3.63 Polo Ralph Lauren Corporation 2.A.75 Reckitt Benckiser plc 3. Ltd 5. 0.93 Compagnie Financiere Richemont SA 3. 1.5 Reckitt Benckiser plc 3.. 1.6 Top 5 Q ratio by product sector Electronic products Home furnishings & equipment Personal & household products Company Q ratio Company Q ratio Company Q ratio Research In Motion Limited 21.54 Imperial Tobacco Group PLC 2.1 Carolina Group 3.05 Europe Germany USA Company Q ratio Company Q ratio Company Q ratio Nokia Corporation 4.95 Arcelik Anonim Sirketi 0.98 Puma AG Rudolf Dassler Sport 3.98 Apple Inc.72 Essilor International 3.94 Henkel KGaA 1.98 Puma AG Rudolf Dassler Sport 3.49 SEB SA 1.99 Hasbro.V.74 Makita Corporation 2. Inc. Inc.B de C.13 Beiersdorf AG 3. Company 3.26 Sumitomo Rubber Industries Ltd.53 Avon Products.93 Unilever Group 2.94 Harman International Industries Electrolux AB 0.89 Diageo plc 2. Ltd 5.95 Nintendo Co.99 The Swatch Group Ltd.26 Inc.98 Fashion goods Home improvement products Tires Company Q ratio Company Q ratio Company Q ratio The Swatch Group Ltd.84 Gruma S. Inc.12 Perdigao S.12 Nikon Corporation 1.V.V. 3.98 1. Inc.3 Husqvarna AB 2.A. 3.97 .16 Makita Corporation 2.98 Michelin Group 0... Company 3. 1. 8.78 Wm. Japan Tobacco Inc 1.33 2.03 Coca-Cola 1.95 Beiersdorf AG 3.V.68 NIKE. S.49 Wm. 1.A. Wrigley Jr. 3. drink & tobacco Leisure goods Company Q ratio Company Q ratio ITC Limited 6.95 Essilor International 3.08 The Stanley Works 1.02 Apple Inc. 2.85 Latin America Japan Company Q ratio Company Q ratio Grupo Modelo.03 Michelin Group 0.05 Sherwin-Williams Company 1.94 Nintendo Co.37 KT&G Corporation 2.97 Nintendo Co.16 The Coca-Cola Company 4.2 Makita Corporation 2. 1.55 Limited Food.2 PepsiCo.03 Fomento Economico Mexicano Nikon Corporation 1. 3.09 Nikon Corporation 1.

the retailers often have a veto this would be a sin tax. there is a plan to develop an automobile for under improvements in economic efficiency. In India. In many countries. by virtue of their size. Retail consolidation drives supplier consolidation margins of suppliers. Second. Finally. playing an active role in of ingredients and products. and gambling. Yet for suppliers. In the future. they indicate a desire for healthy foods. and it made retailers more focused to find ways to manufacture at very low cost and sell products on offering a better value proposition. product companies. Within major merchandise categories. alcohol over supplier product initiatives. The real winner in this was with minimal packaging (as the latter often accounts for a large the consumer. On the other hand. suppliers will look to these markets for a large share of their future First. it could lead to innovative and lower cost in emerging countries has stimulated higher commodity prices. That is.000. Inflation and deflation put the squeeze on suppliers growth has come from emerging markets. For example. a growing share of global consumer spending 1. In discussions with executives of processed food suppliers. US$2. to household and personal care products. China. By focusing on high volume and low importance in many other developed markets and even some prices. one issue that keeps coming up is obesity. Already many such efforts are under India) put downward pressure on global wages and enabled vast way. The relatively low-cost and easy availability of costs back up the supply chain. low product price inflation created share of total cost). This is likely to continue. countries adopted sensible monetary policies aimed at growth. have shifted the balance of reached crisis proportions in the US and is becoming of critical power in the supply chain. Of particular interest will be the rising incomes of the keeping inflation low and economic growth stable. picking favored vendors in each category they sell. retailers are children is of particular concern. akin to those levied on tobacco. As such. the retailers have competed directly with their branded workers have contributed to this problem.” the rise of a handful those that can navigate this minefield by keeping costs low of powerful low-priced retailers has wreaked havoc for consumer and brand equity high. How to reach the world’s poor? In recent years. large retailers are demanding issue. manufacturers are trying suppliers more cost sensitive. This consolidation has taken place through merger and acquisition activity as well as through strong organic 2. This effort is likely to intensify in the next few new headaches. Moreover. In essence. Obesity among more focused assortment for consumers. successful suppliers will be Often referred to as “the Wal-Mart effect. By developing strong private fast/fatty foods and the increasingly sedentary lifestyles of many brands. The challenge will be to entry into the global economy of nearly one billion workers from develop products on a mass scale that are affordable to relatively formerly closed economies (Russia. yet they continue to purchase and enjoy relatively unhealthy foods. The combination of upward pressure on input prices and downward pressure on product prices has squeezed the profit 4. This public health issue has Large retailers. The goal is to reduce distribution costs as well as create a large increase in public health expenditures. Consequently. Even when it comes This new era of low inflation made consumers more price sensitive. This is particularly difficult as many consumers have highly dependent on key retailers. expanded economic growth years. The challenge will be to meet the rigorous taste demands of fickle consumers while providing a healthier eating One effect of retail consolidation has been to make suppliers experience. especially China and In the past twenty years. Wal-Mart alone accounts for roughly 14% to 18% of the sales of many large | 23 . consumer product unusually low inflation. products industry 3. they have put price pressure on suppliers and have shifted emerging markets. the world has witnessed a new era of India. This means that fewer vendors are needed. This came about mainly for two reasons. some of these threatens to rapidly increase the incidence of serious illnesses such retailers are reducing the number of vendors with which they as diabetes. Central Europe. It could lead to a decline in life expectancies and a deal. many food suppliers are responding by changing the mix customized products from suppliers. A possible government approach to product development. the poorest consumers in these countries. Health and obesity concerns growth by the largest players. Global powers of the consumer products industry Trends in the consumer a certain degree of cognitive dissonance. and low income consumers. products aimed at affluent markets as well. computer manufacturers seek to offer personal computers for under US$200. The rise of obesity suppliers. And this means that many suppliers As consumers and governments start to take an interest in this must fight for shelf space.

Indeed. Is it all about price? to increased purchases of traditional products. the challenge is to break out of this dilemma by building hypermarkets. On the other space to the kinds of products on which consumers spend hand. Even in the already affluent developed non-GM. In addition. There won’t inevitably to lower margins. Yet while this is a good idea. and websites to choose from. consolidated. but perhaps consumers can be stimulated to spend more on each such event. that are sufficiently differentiated. more successful at consumer segmentation than their traditional electronics. creating the impression the existing range. In other be able to exert leverage with retailers. retail consolidation is taking place on a global means a greater imperative to come up with ideas that stand out scale — including in emerging markets. many innovative electronics. That means less space devoted to food and different consumer cohorts indicates that they may actually be other fast moving goods and more space devoted to apparel. this means more competition for space. reasons: first. Innovating for long-term growth traditional retailers and suppliers. Thus. To do this requires bet. for low-priced and high-priced goods. and services such as travel. consumers the world over are becoming trained to expect low Instead. In a few cases. Yet this expanded affluence has not necessarily led 7. discount formats — even when it comes to fashion apparel and home fashion. fashion. In doing so. single price stores. the share is much consumer goods. many consumers have accelerated their spending due traditional players with a declining share of wallet. 24 | . only so many times you can wash your hair or mop your floor. consumers are increasingly seeking alternative venues institutionalized. specialty Consumers the world over are becoming richer – especially in retailers offer alternative categories and brands such as organic. to create organizations that are At the same time that each retail segment is becoming more among the handful of suppliers favored by the big retailers. These retailers have focused producing products and. to increased wealth associated with their homes and financial portfolios. second. these trends have led to merger to either acquire newer brands or develop brands that meet new and acquisition activity. the rise of hard discounters and one price stores has caused problems for 5. After all. thereby. Yet in order to make or fascias – and this is especially true of younger consumers. premium brands that would help to boost One issue is that mass merchandise retailers are devoting more margins. Fragmentation of the consumer experience through scalar efficiency. At the upper end. For consumers continue to manage and define relationships with consumers. drug stores. categories the choices are great as well. there are After many years of rising market share for discount retailers. but a focus on price alone will lead innovative. recognize that they have created a monster and are interested in having differentiated. This has been important for several consumer needs. upscale consumers have switched from traditional formats to and entertainment. That means creating emanate from low prices. It also higher. For suppliers of fast moving suppliers. The challenge for traditional suppliers is For consumer product suppliers. hard direct consumer relationships and offering products and brands discount stores.Consumer Business consumer product suppliers. third. this leaves the countries. the process of innovation must be Moreover. After all. more upscale products and brands. dining. Indeed some big retailers words. to reduce overhead costs 6. most of the incremental spending has had to do with prices even for relatively high quality merchandise. membership warehouse clubs. and upscale specialty products. suppliers would convenience stores. such a strategy sustainable. from the crowd — especially ideas that involve premium brands with premium pricing. to offset the shifting balance of power by creating larger supplier organizations. This represents an opportunity for suppliers. supercenters. consumers are being offered a wider range of Yet supplier consolidation alone is not sufficient. suppliers are under pressure from retailers The challenge for consumer product companies is to find ways and consumers to offer a higher sense of value. the success of some retailers in creating private labels for incremental income. supermarkets. For purchasing food and household products. it is a one-shot that all products are commodities and that purchasing decisions deal and is not consistent with longer-term growth. appliances. Moreover. especially their motivations. and games. for example. It that consumers are increasingly disloyal to particular formats requires innovation in order to differentiate. At the low end. there are suppliers. necessarily be more hair-washing events. In other are made only on the basis of price. This sense can to capture some of this extra spending. emerging markets. it appears ter information about consumers. retailers retail formats for each merchandise category. Again. The sad The problem stems from the fact that consumers have been alternative for suppliers is to dramatically reduce the cost of trained by price-oriented retailers. generate greater margins on on price to the exclusion of much else. it is not sufficient.

Managing these will require some new approaches. Purveyors of the In recent years. Finding alternatives to traditional marketing That is not to say that suppliers lack choices. that middle is often saturated critical as much of the transfer of knowledge will involve off. and partnership efforts. and properly manage a geo. special events. The soon to retire baby boom generation in the US same time targeting a mass audience. they will organic innovation. technology now allows consumers to avoid marketing could very well be that the optimal strategy for suppliers will be to information through channel surfing. business opportunities in emerging markets. Thus. The talent dilemma channels such as organic and health related food retailers. Global powers of the consumer products industry 8. The 10. the mass market is generally graphically and culturally diverse workforce. or some be more serious competitors to consumer product companies. This is especially to survive. This is especially true as consumers continue to fragment into more narrowly defined groupings. They will do best to focus on leading brands and newer niche and innovative brands. especially to emerging nations such as India and the bell. more differentiation and Western Europe will be succeeded by a smaller generation is likely to mean more niche selling. Many others pine to work in technology or media. especially those with a strong consumer following. and video games means that marketing channels are That will leave second tier national brands. This means exploiting the and. lifestyle. in fact. and downscale retailers (such as one price consulting. The advent of new technologies has enabled consumers will be well positioned to negotiate with retailers from strength. consumer product companies in order to improve their own private Instead. to obtain entertainment in many more ways than in the past. It Moreover. attract strong talent. small. acquisition. product placement in films and games. and increasingly commoditized. and niche brands. retailers are now hiring marketing executives away from How will suppliers attack the long tail? There is no single solution. roughly 60% of new MBAs go to work in banking or and specialty stores. and are forms of marketing. between leading brands. or interests) are knowledge. this environment.” Specifically. will not. relationships will be successfully managing brand portfolios. the internet. | 25 . a smaller pool of talent. For example. These can involve internet advertising. hence. recording programming. Some of this offshore talent will involve managing new well exploited. Retailers close to a more narrowly defined target consumer through new are becoming more concentrated and more powerful. if you assume that most companies. the development of niche brands that focus on proliferation of cable and satellite television channels. Much existing talent is aging and near There are not many opportunities to differentiate while at the retirement. declined. targeting the long tail will also involve getting supplier relationship will be driven by retailer behavior. If retailers become better at managing private labels. combination thereof. The At the same time. Thus. The latter will be in the middle of that bell. managing new kinds of retailers. upscale In the US. Managing retailer-supplier relations fragmentation of mass media both reflects and encourages Unfortunately for suppliers. the challenge then is to retain and transfer group consumer cohorts (defined by income. however. cinema advertising. For consumer product much-discussed “long tail. The key is to figure out the right mix of organic. may offer opportunities that have not been China. or rationalize their brand portfolios by shedding second tier brands. however. It requires flexibility and openness to new ideas. purchasing entertainment online. Many. struggling becoming fragmented and less productive. opportunities in the long tail can be exploited through labels. private brands. In stores). Thus. The long tails at either end of shoring of talent. focused consumer cohorts. distributed in a bell-shaped curve. it is hard for consumer product companies to attract the best and brightest. this means that alternative approaches are essential. will likely lie. Yet the problem goes beyond 11. Some could involve It is in this long tail where future profitable growth opportunities transferring entire functions to emerging markets. will take expanded market share. A disproportionate share of the growth of consumer spending will probably be driven through new 9. acquisition of existing businesses. Grabbing the “long tail” of opportunity competition for talent. a large consumer products company can act as a financing tool for small entrepreneurs with innovative ideas. increasingly focusing on managing and marketing their own brands. Moreover. the power of mass marketing has dramatically leading brands. DVDs. much of what happens in the retailer this trend. and tie-ins with Another important part of managing retail relationships will be other brands. Today. They will be stuck in the middle true when it comes to the much sought-after young consumer. an important part of managing retail For suppliers.

This is a tall order. To date.co. potentially. there is an expectation that Deloitte Research future policy initiatives will be more aggressive and. lhutter@deloitte. consumers are increasingly indifferent to brand messages. The challenge is greater than just building brand equity. This focus is likely to grow in the future. Deloitte Belgium of course. being proactive in this Karthryn Cordes area can be good business. The challenge is to create differentiating factors in order to attract a target consumer. brand equity becomes critical.com efficient properties. In a commoditized world. private brands. and one-price stores reflects this indifference.com the differentiating factors about a product or service. no-name brands. and clean renewable energy bonds. 26 | . solar energy credits. A brand. the impact that companies have on society. and concerned about. ikalish@deloitte. This includes concern about the safety and Global Consumer Business Leader health of workers who produce goods. brands are of even greater importance to consumer oriented businesses than in the past. Marketing Awareness is growing that. Ira Kalish more costly for companies. Finally. use that dialogue to build a brand that conveys the differentiating factors. government action in this Deloitte Services LP area has been more carrot than stick – deductions for energy. especially for consumers who are particularly concerned about Consumer Products Leaders these issues. Social responsibility In many parts of the world consumers are becoming increasingly For more information: aware of. Americas Already many companies are measuring their societal impact Bruce Westbrook and have appointed high-level executives to focus on social Deloitte Consulting LLP responsibility issues.uk This concern is increasingly reflected in the policies of governments as well.com Europe. is simply an efficient piece of information that defines kdestaercke@deloitte. with the notable exception of luxury goods. use new marketing tools to engage the target consumer in a dialogue.Consumer Business 12.com time. Moreover. taking action now may either Deloitte Touche Tohmatsu mitigate future regulatory costs or at least smooth the cost over kcordes@deloitte. and the impact on Deloitte UK the environment of consuming goods and disposing of waste. bwestbrook@deloitte. First. Second. taking action can actually reduce unit production costs — especially when it comes to packaging. The brand — more important than ever Koen De Staerke In this environment. the impact on the Lawrence Hutter physical environment of producing goods. In such a world. and execute the strategy in order to convince consumers of the reliability of the brand. for companies. Middle East and Africa 13. taking action now can enhance brand equity. The rise of discounters.

com Montree Panichakul mpanichakul@deloitte. Nisbet Pieter Peerlings Bahamas anisbet@deloitte.com pethormann@deloitte.tw meriksen@deloitte.com bjennings@deloitte.com Richard Lloyd-Owen rlloydowen@deloitte.nz drighetti@deloitte.N.com Singapore Netherlands Alan R.com Ping Lee Marius Eriksen Brazil pinglee@deloitte.com Korea Greece Do-Sung Kim George Cambanis United Kingdom dosungkim@deloitte.com Dina Nemirovich dnemirovich@deloitte.co.com ggoldenberg@deloitte.es Australia Denmark Andrew Griffiths Henrik Knak Sweden andgriffiths@deloitte.th | 27 .com jroque@deloitte.com Carribean (LACRO) New Zealand Italy Argentina Lisa Cruickshank Dario Righetti lcruickshank@deloitte.com hknak@deloitte. Middle East South Africa Venezuela and Africa Rodger George Ignacio Rodriguez rogeorge@deloitte.com China/Hong Kong Finland Eric Tang Jussi Konkola Switzerland eritang@deloitte.com J.com.com ocamacho@deloitte.com Belgium Spain Koen De Staercke Juan Jose Roque Asia Pacific kdestaercke@deloitte.com jsancheznino@deloitte.com Lars Egenaes legenaes@deloitte.com Daniel Varde dvarde@deloitte. Hill jnhill@deloitte. Global powers of the Consumer business contacts consumer products industry For Deloitte Touche Tohmatsu and its member firms North America Portugal Chile Luis Belo Juan Echeverria United States lbelo@deloitte.com jecheverria@deloitte. ycyee@deloitte.com India France Shyamak Tata Gilles Goldenberg Turkey shyamaktata@deloitte.com Canada Brent Houlden Slovenia Mexico bhoulden@deloitte.ca Graham Hayward Omar Camacho ghayward@deloitte.com gcambanis@deloitte.com Japan Germany Yoshio Matsushita Peter Thormann Ukraine yomatsushita@deloitte.sg ppeerlings@deloitte.uk Malaysia Ireland Yoon Chong Yee Brendan Jennings Latin America.com.com igrodriguez@deloitte.co.com Bruce Knowles Taiwan Norway kbruce@deloitte.com Altair Rossato Thailand arossato@deloitte.com Pat Conroy Deloitte & Touche USA LLP Russia Colombia pconroy@deloitte.co.com Ugur Suel usuel@deloitte.com Graham Povey Juan Carlos Sanchez Nino gpovey@deloitte.com Europe.com jkonkola@deloitte.

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