GLOBAL RETAILERS OVERCOMING HURDLES

PARIS - CIES - The Food Business Forum here is optimistic about global food retailing as it celebrates the 50th anniversary of its annual executive forum called the World Food Business Summit.The upbeat outlook springs from retailer resilience in the face of mounting challenges, and growing relationships between trading partners, said Alan McClay, chief executive officer, CIES."Some are despondent

PARIS - CIES - The Food Business Forum here is optimistic about global food retailing as it celebrates the 50th anniversary of its annual executive forum called the World Food Business Summit.

The upbeat outlook springs from retailer resilience in the face of mounting challenges, and growing relationships between trading partners, said Alan McClay, chief executive officer, CIES.

"Some are despondent about the challenges, but we are optimistic," he said in an interview with SN in advance of the CIES summit here next month. "The difficulties are helping companies to become more efficient and better."

CIES has a membership of 350 retailer and supplier companies and organizations from around the world.

McClay pointed to a roster of retailer challenges that is all too familiar, including consolidation, new formats, competing channels, price pressures and tight margins.

"There's been a shakeout that's weeded out players," he said. "But many companies have been able to take advantage of this. Players small and large are adapting and doing well."

Furthermore, he said, supermarkets are well positioned to benefit from their middle-of-the-road status.

"We don't see a problem with the middle of the road," he said. "We think supermarkets are by nature middle of the road. It is their strength. They have broad appeal."

The upbeat outlook is underscored in the theme of this year's CIES summit: "Flying High in the Face of Competition." The event will be held June 21-23 at the Carrousel du Louvre here.

The event will include presentations by top retail and manufacturing executives. Speaking about "Leadership and Transforming an Organization" will be Anders Moberg, president and chief executive officer, Ahold; E. Neville Isdell, chairman and CEO, the Coca-Cola Co.; and Patrick Cescau, group chief executive, Unilever. In another session, John Menzer, vice chairman of Wal-Mart Stores, and Jean-Paul Agon, CEO of L'Oreal Group, will address "Sustaining Success as a Global Leader." Another retailer speaker will be Richard Anicetti, president and CEO, Food Lion.

At the summit, CIES will elect a new chairman to succeed Claude Hauser, who is also chairman of Federation of Migros Cooperatives, Switzerland. Hauser's two-year term is about to end. The gathering will mark half a century since the first meeting in 1956 in Rome. The event has moved around the world to countries including Germany, Japan, France, Britain, Canada, Hungary, Australia and the U.S. It used to be known as the annual Executive Congress.

McClay pointed to progress among trading partners in forging closer ties in the face of challenges. He cited the industrywide Global Food Safety Initiative, a six-year-old effort that aims to increase food safety by helping to ensure that suppliers conform to acceptable standards. "GFSI was initially a retail initiative, yet there's room for exchanges of experiences with brands. So, in the past year-and-a-half, brands are sitting on the GFSI board and are involved at all levels of sharing."

Moreover, CIES is underscoring its own relationship with brands, which are now invited to join the CIES Strategy Committee, which makes medium-term recommendations to the association, he said. Among brands that have agreed to join are Kraft, NestlT, L'Oreal and Danone, which will be represented by top-level executives.

The industry still faces hurdles in dealing with consumers, he said. One of those involves criticisms of retailers by consumers and the media, with high-profile cases recently involving companies such as Wal-Mart and Tesco.

"Most consumers are broadly satisfied with their main grocery stores, but there are negative perceptions about the contribution of food retailing to the economy," he said. "The food sector needs to pay attention to make sure there isn't a knee-jerk reaction of imposing legislation."

Retailers need to communicate their messages more proactively, he said. This involves "showing what they are doing in terms of quality, value and high standards. That includes areas such as nutrition, labor and the environment, all things important to public opinion. Retailers have a good story to tell."

There's also more to do in advancing technology, including RFID, he said.

McClay pointed to other challenges for trading partners, including avoiding consumer panic related to avian influenza and continuing to grow company presences in emerging markets.