AVI: Doing everything right in a difficult market
The diversified brands company did well in its year to increase revenue, despite the current consumer sector slump
Tough times are putting consumer-facing companies’ business models to a harsh test. Even firms with business models as robust as that of diversified consumer brands company AVI find it exceptionally challenging. "We are hanging in there, but it is not easy," says CEO Simon Crutchley. "We are not seeing any top-line volume growth." In fact, in many areas volumes declined in AVI’s year to June. Among its leading food product lines, tea (Five Roses, Trinco and Freshpak) experienced a 5% volume fall, biscuits (Bakers, ProVita and Baumanns) dropped 3.7% and creamers (Ellis Brown) are 4.6% down. Crutchley believes the current consumer sector slump is more severe than that of 2008 and 2009, when SA was dragged into recession by the global financial crisis.
"Back then there was still underlying confidence in SA and a lot of consumer credit extension," says Crutchley. "The country is now facing serious structural problems that were not present then. Confidence is being hit hard." AVI d...
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