2009 KPMG Executive Roundtable: Positioning for Growth in Uncertain Times

Smith: How have your companies been managing growth during this time, and what’s been happening to new product development? Has there been any noticeable change there?

Pollack: Absolutely. First of all, one of our best practices really is always keeping that new product development pipeline full 24 months ahead of time. I think what we’re seeing is the need to adjust the product that we put in the market to a changing consumer. We’re seeing across the board demand for value products, so we need to adapt and put products on the market that a changing value consumer is going to purchase.

Demone: Well, we’ve continued to develop new products. Where we see a change in the market is, in particular, in national restaurant chains focused on the family and casual dining segments. And I would say more so in the U.S. than in Canada. These businesses are really under pressure – there’s a lot of time and money invested in bringing a successful new product into their system anyway. And in this environment we find that really tough. On the other hand, I think that with the shift in consumer demand, it has made the retailers and the club stores open a little bit more.

Higgins: From a new customer opportunity, we’re actually getting people calling us to talk about being their supplier. It is the first time it’s ever happened. And we’re not talking about small guys; we’re talking about some big players in the industry. So I find that curious, but I think every business is looking at what they can do to improve themselves. The other aspect of our business is that – like everyone – the value equation is in right now. If you can find a way of, for example, taking green tea, which is considered to be a premium product, and moving it into the economy segment you’ve satisfied peoples’ interest.

Cator: We’re seeing some significant increases in new business opportunities. I would say there are a lot of companies looking for value, not necessarily cheap quality. We’re in the burger business, we’re not high-end steak. And Cardinal can deliver real value in a segment that people turn to when they’re looking for comfort food, when they’re looking to trade down, but still want to feel pride in what they’re buying. New customers are interested in our approach in the burger category and in our fully cooked meat business. We’re approaching that with a certain amount of cautious optimism too, because, the reality is there’s a lot of pressure for these buyers to go out and find better value.