Coaching SMEs in the Fast-Moving Consumer Goods sector

Coaching SMEs in the Fast-Moving Consumer Goods sector

Gheorghe Constantin (on the left) is a Team Coordinator (TC) specialising in the Fast-Moving Consumer Goods (FMCG) sector. He started working for the EBRD in January after 22 years of experience of working with corporations such as Coca-Cola, BAT, Colgate Palmolive and Bunge.

Join him for a 2-hour Q&A session on the Advice for Small Businesses LinkedIn Group page on the 23 September 2016 from 9AM until 11AM (London time).

What is the FMCG sector?

Fast-Moving Consumer Goods are products which are sold quickly and at relatively low cost. Examples include non-durable goods such as soft drinks, toiletries, processed foods and many other consumables. The FMCG sector is thus characterised by a low contribution margin and a high volume turnover.

FMCGs have a short shelf life, either as a result of high consumer demand or because the product deteriorates rapidly. Moreover, the FMCG sector encompasses a large range of value-adding activities from suppliers, manufacturers, processors, service providers (from marketing to logistics) to retailers.

How do you describe your role as a TC on international advisory projects?

There are four dimensions to the role of a TC. Firstly, the TC creates a tangible link between the EBRD’s advisory services and SMEs, identifying the optimum resource for a given set of needs. The latter entails a focus on listening to the client’s needs and wishes to identify actionable and realistic objectives.

Secondly, in building awareness for available banking advisory services through sector development activities (SDAs), the TC has a value-added role to create opportunities and to build a pipeline.

Thirdly, the TC role also encompasses an information management dimension by which it contributes to the revitalisation of international advisory human resources, through finding new and suitable advisers, ensuring state-of-the-art market knowledge and the relevance of advice tailored to each particular project.

Lastly, another main dimension of the TC role entails engagement with local consultants, as a reality check and an opportunity to exchange views and share knowledge.

What have you learnt from your executive experience working with big corporations?

One of the key challenges facing SME advisory hinges on the fact that many SME-owners will be sceptical that advice sourced from a corporate background can be applied to an SME. In fact, a €200 million country operation could present similar sets of challenges as an SME.

Business challenges can be broken down into a concise set of paradigms which are common to all businesses, regardless of their size.

What differs is the way of tackling these challenges (international experience vs. local), the available capabilities, access and management of the information and the human capital which form the core of the knowhow transfer to SMEs.

The concept of confidence-building is crucial here. I deem the role of the TC comparable to that of a coach, who is meant to pro-actively build players’ confidence and develop their inner strength. The TC’s role is not to apply a magic formula to the business in order to make it grow but rather to listen to the client’s ideas and to help translate the need for change into a lasting construction.

Just like a coach’s, the TC’s role starts with proactively encouraging the businesses’ ideas, telling them that they have the potential to discover internally the solution, that they need to identify it, structure it and gain confidence to build a project plan around it.

Where do you see a need for advice in the FMCG sector?

The fundamental missing link remains the absence of a solid value chain approach that connects all the key functions within the business (supply chain, production, product development, marketing, sales, finance, HR and management).

Moreover, SMEs in the FMCG sector also need to develop the ability to understand and integrate their efforts to balance supply and demand so as to minimise risks.

What do you think are the most interesting developments in the FMCG field lately?

The FMCG is a growing sector, which tends to include mostly family-businesses ran by young entrepreneurs increasingly open to new sector developments. Women are increasingly active in creating businesses in this sector. Currently, over 40% of the projects I am supporting are women-led. At the same time, SMEs in the field tend to increasingly aim at exporting which entails updating and increasing their standards and which ultimately translates into considerable quality leverage and market advantage.

Online business development (including social media-driven consumption) is currently one of the most interesting developments in the FMCG field. It enables changing patterns of purchasing to shape new products and services (namely, exports).

Such cross-border transformation entails a need for business models to be flexible enough to adapt and respond to these upcoming trends.

Lastly, what motivates you to be a TC on international advisory projects?

Personally, what I find most appealing in this role is the “space”: space for creativity, for interaction with different cultures and different people, for travelling to a varied set of countries and regions as well as the overall sense of accomplishment in helping someone  build their self-confidence and achieve their business plans.