Value Creation in Retail

Most businesses are not short of value. They are leaking it.

By Antoine Maccioni - Sep. 10, 2026

1. Value Usually Leaks Before It Collapses

One of the most difficult things about value leakage is that it rarely arrives with a warning sign large enough to force immediate action. It appears in small shifts: a little more discounting, a little more stock, a little more labour, a little more complexity, a little more cost to serve.

Individually, none of these moves may look dramatic. Together, they can materially change the economics of the business. I have seen situations where the organisation was still growing, teams were busy and customer activity looked healthy, yet the underlying value creation was weakening.

That is why I tend to look beyond topline growth. Revenue can hide a surprising amount of inefficiency. The real question is whether each additional euro of sales is creating enough gross profit, cash and return on capital.

This is also why I believe value creation should start with diagnosis, not action. Before deciding what to improve, I want to understand where the business is already giving value away. Sometimes the answer is pricing. Sometimes inventory. Sometimes labour productivity. Sometimes assortment complexity. Sometimes a supply chain designed for a business that no longer exists. Often, it is several of these at once.

"The first step in value creation is not finding more value. It is understanding where the existing value is escaping."

2. Start With the Gap, Not the Initiative

I have become cautious when value creation starts with a list of projects: pricing, procurement, cost reduction, digital acceleration, network optimisation, working capital. All of these may be valid, but a long list of initiatives does not necessarily mean the business has understood the problem.

I prefer starting with the economic gap. What needs to improve, by how much, and why?

• If EBITDA needs to increase materially, where should that improvement come from?

• If cash generation is too weak, what is absorbing it?

• If gross margin is under pressure, is the issue price, mix, promotion, sourcing, shrinkage or something else?

• If productivity is deteriorating, is it labour, process, structure or complexity?

Once the gap is clear, initiatives become a consequence of the diagnosis rather than the starting point. For me, that distinction matters because it helps avoid a common trap where the organisation becomes very active but not necessarily more valuable.

It also sharpens prioritisation. When the economic gap is explicit, leadership can ask the harder question: which few actions will actually move the number?

"The value creation plan should not begin with what we want to do. It should begin with what must change in the economics."

3. Not All Growth Creates Value

Growth is attractive. It creates energy, momentum and a sense of progress. But over time, I have learned to separate growth from value creating growth. They are not always the same thing.

A business can grow revenue and still weaken margins. It can gain customers and increase cost to serve. It can accelerate digital sales while diluting contribution. It can open new locations that add volume but destroy return on capital. It can push promotions that increase transactions without improving profitability.

This does not mean growth should be slowed. It means growth should be understood properly.

• I tend to look at the quality of the growth.

• Is the customer profitable?

• Is the mix improving?

• Is the margin sustainable?

• Is the working capital requirement reasonable?

• Does the growth improve scale economics or add complexity?

• What happens to cash?

• What happens to return on capital?

These questions are particularly important in retail and distribution, where volume can sometimes look better than value. I have seen businesses celebrate topline momentum while quietly giving too much away through price, promotion, inventory, service complexity or capital.

"Growth deserves to be celebrated when it strengthens the economics, not only the topline."

4. Focus on the Few Value Pools That Matter

Most businesses have more value opportunities than they can realistically execute. That is not necessarily good news. It can become another source of dilution.

Pricing, procurement, range, inventory, labour, logistics, SG&A, digital, working capital, network productivity and commercial terms can all represent meaningful opportunities. The challenge is deciding where leadership attention will create the greatest return.

In my experience, the most effective value creation efforts do not try to attack everything at once. They identify the few value pools that matter most and concentrate resources behind them.

This requires discipline because every function can usually make a convincing case for why its initiative matters. The difficult part is ranking them.

• Which value pools are large enough to matter?

• Which can realistically be captured?

• Which require structural change?

• Which create value quickly?

• Which depend on other capabilities being fixed first?

• Which consume disproportionate management attention for limited return?

That last question is often underestimated. Leadership capacity is finite. A value creation plan that looks excellent on paper can become ineffective if the organisation cannot absorb it.

For me, that is why value creation has to be looked at through two lenses: economic potential and execution capacity.

"Value creation is not about finding every opportunity. It is about choosing the few that deserve the organisation’s attention."

5. Sequence Matters More Than Most Plans Admit

Even the right initiatives can fail if they happen in the wrong order.

I have seen businesses try to improve pricing before fixing the data, reduce inventory before improving forecasting, simplify the organisation before clarifying accountability, accelerate digital growth before understanding fulfilment economics, or optimise the network before agreeing on the customer proposition.

The individual ideas may all be right. The sequence is not.

This is why I have become increasingly attentive to dependencies. Some actions unlock others. Some create value quickly. Some take longer but are necessary foundations. Some should not start until the organisation is ready.

This is particularly important in large transformation or value creation programmes because the temptation is to launch everything together. That can create visible momentum, but it can also create congestion. Teams become overloaded, dependencies are missed, the same people are required in multiple workstreams, and the organisation starts managing complexity created by the programme itself.

For me, sequencing is not a project management detail. It is a leadership decision.

"A good value creation plan is not only about choosing the right actions. It is about doing them in the right order."

6. Measure Value, Not Activity

Value creation programmes naturally create activity. Projects launch, milestones are reported, dashboards become more detailed, savings are identified and teams become busy.

But activity is not value.

I have learned to be particularly careful with claimed benefits. A saving identified is not necessarily a saving realised. A margin opportunity is not margin captured. An inventory target is not cash released. A pricing action is not price realisation.

This is where Finance has an important role, not as the function that validates the programme at the end, but as part of the value logic from the beginning.

For each major initiative, the chain should be clear: what changes operationally, which metric should move first, where the economic benefit should appear, when it should appear and who owns it.

These questions are simple, but they protect credibility. I have seen value creation programmes lose momentum because too much attention was given to declared benefits and not enough to realised ones.

For me, the principle is simple: if the value cannot eventually be seen in performance, it has not yet been captured.

"A value opportunity becomes real only when the business can prove it in the numbers."

7. From VCP to Continuous Value Creation

This is the part I find most important.

A Value Creation Plan can be extremely useful. It creates focus, forces prioritisation, aligns leadership and makes the economics visible. But I have also seen the limitation of treating value creation as a one off programme.

The risk is that the business improves for a period, delivers the plan, and then gradually starts leaking value again. Complexity returns. Costs creep back. Inventory grows. New initiatives accumulate. Commercial discipline weakens. The organisation slowly moves away from the operating standards that created the improvement.

That is why I believe the real ambition should be Continuous Value Creation.

Not a permanent transformation programme. A permanent management habit.

The organisation should repeatedly ask where value is leaking now, which assumptions have changed, which activities no longer deserve resources, where complexity has increased, which value pools are becoming more important, and what should be stopped, simplified or reallocated.

When this becomes part of the normal operating rhythm, value creation stops being a special event. It becomes part of how the business is managed.

For me, that is the real shift: from VCP as a programme to CVC as an operating discipline.

"The strongest value creation plans are the ones that eventually make the next value creation plan unnecessary."

Try This

Take one business unit, one country or one category and ignore the initiative list for a moment.

Ask:

• Where is value leaking today?

• Which three value pools matter most? What is the economic impact if we fix them?

• What has to happen first for the value to be captured?

• How will we know the value has actually reached the business?

Then add one final question:

What are we prepared to stop doing to make room for it?

That last question is often the most revealing because value creation is not only about doing more. Quite often, it comes from removing complexity, reallocating resources and becoming more disciplined about what really matters.

"Do not ask only where more value can be created. Ask where value is already being lost every day."

This article builds on themes previously explored in a LinkedIn post.