Challenges and opportunities for the branded goods industry in 2025

The branded goods industry is facing a variety of challenges characterized by high consumer price sensitivity, rising costs and an uncertain economic situation. The increase in sales in 2024 was mainly achieved through price increases, while sales volumes stagnated[1]. However, higher prices alone are rarely enough to fully compensate for increased costs, which puts profitability under pressure.

Current challenges

1. Price sensitivity of consumers: Consumers’ price sensitivity will remain high in 2025. Price trends will continue to play a major role in purchasing decisions and lead to a further decline in brand loyalty.
2. Rising costs: Companies are suffering from higher expenses for energy, rent and salaries. These increased costs represent a massive burden and lead to the insolvency of well-known companies.
3. Uncertain economic situation: The general economic uncertainty also contributes to the challenge. Companies must adapt to a volatile market situation and react flexibly to changes.

Unused profit potential

Despite these challenges, there is untapped profit potential in the core business that can be leveraged through targeted initiatives:

1. Focus on the essentials: Sharpening the core product range and using shopper and customer insights can help to mitigate declines in earnings and develop growth concepts with retailers.
2. Growth with clear, lean conditions: Introducing transparent discount structures and rewarding performance can drive growth through performance. Closer dovetailing of conditions and promotion is also crucial.
3. Strengthen execution: Focusing the sales force on high-turnover stores, optimizing POS placements and more efficient processes can strengthen conversion.
4. Smart promotions: Prioritizing ROI-strong promotions, clear rules for promotions and rewarding top performance are important measures. Innovative price maintenance concepts can also be used to increase profitability.

Outlook for 2025

No major growth impetus is expected for 2025. Nevertheless, profitability can be increased through targeted initiatives and a focus on the core business. The use of Power BI can play a decisive role here. By analysing data and visualizing trends, companies can make informed decisions and adapt their strategies accordingly.

Power BI makes it possible to gain comprehensive insights into sales development, customer satisfaction and the efficiency of promotions. By integrating data from different sources, companies can obtain a holistic picture of their performance and take targeted measures to increase their profitability.

Conclusion

The branded goods industry is facing major challenges, but also opportunities. By focusing on the essentials, introducing clear conditions, strengthening execution and using smart promotions, companies can increase their profitability. Power BI can help make informed decisions and take the right actions. The future remains uncertain, but with the right strategies, companies can succeed even in a difficult market environment.