Q4 2017 Consumer Products Industry Spotlight
INSIGHT ARTICLE |
- The goods that retailers are selling need to be touched and experienced during the customer’s visit. Those are going to be the products that win out
- Large retailers continue to struggle as consumer choice continues to migrate online, despite a successful year overall. Black Friday 2017 saw record e-commerce sales numbers, a trend that is only expected to continue
- Several consumer metrics are showing signs of health, including upswings in discretionary income and disposable income. There is new uncertainty, however, with client-related entertainment and meal spending, which were affected by recent tax legislation
- The CP dealmaking environment was very competitive overall in 2017, reflecting high levels of dry powder and fewer quality assets coming to market. The competitive environment helped keep volume down and median deal sizes at historically high levels
The same trends that defined 2017 are expected to continue into 2018 and beyond. Shoppers are increasingly comfortable purchasing items online, even items that consumers have traditionally bought in-store. CP companies will continue improving their omnichannel efforts, and improving consumer metrics will provide a tailwind to the industry overall. Expect deal activity to remain very competitive, with multiples staying historically high (barring any macroeconomic developments).
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