Navigating turbulence calls for a steady hand - reach out to G2 today to support your strategic objectives.

Second quarter results would suggest all is well for Consumer companies, besting expectations as consumers continued to buy and earnings continued to grow. So, why are these same companies sounding the alarm, battening the hatches, and calling for a soon-to-be reckoning?

Simply put: confusion and uncertainty. After a decade of near-zero interest rates and the recent global pandemic, it does appear that?“this time is different”.?Like today, inflation rose in the 1970s and 1980s, but at a far steeper rate and on the heels of 35-year low-rate environment that also witnessed world war, incomparable social spending, and a final blow to the gold standard. As the dust settles on a post-pandemic world, and despite higher inflation and lower GDP, consumers have emerged employed and surprisingly resilient….but for how long?

Despite the mixed signals, we see at least two irrefutable headwinds: pervasive inflation and troubled supply chains. How will the Federal Reserve and companies titrate for the two? Has the Fed responded soon enough and to the appropriate extent, or will we see a “hard landing”? How consequential is the recent slowdown in inflation, and how will companies manage continued supply chain imbalances and the delicate business of serving customers, managing inventories, and sustaining margins??

Consumer companies are beginning to act, some cautiously as they sound the alarm on future initiatives, and others more decisively as they begin the not-inconsequential task of rationalizing SKUs and right-sizing staff. All the while, management teams alike continue to walk a fine line on supply chains, which most experts don’t expect to normalize until at least 2024. On the M&A front,?

Fluctuating and unpredictable valuations are (1) driving under-prepared companies to consider a sale too soon, and (2) keeping the performing ones at bay as they hold out for higher, more reliable valuations.?

Navigating such turbulence calls for a steady hand steeped in meaningful operational and transactional experience. Someone to act with confidence and expertise, not fear.

At G2, our roots as operators run deep, allowing us to be decisive and nimble in times of uncertainty, and steadfast in our conviction that?failure is never an option, especially where our clients are concerned.?