Survey: Consumer-Packaged Goods Industry Cuts IT Spending Rate - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Business & Finance

Survey: Consumer-Packaged Goods Industry Cuts IT Spending Rate

A report released by the Grocery Manufacturers of America says the industry spent 1.42% of its net sales revenue on IT, down from 1.56% in 2002.

Known for its fiscal conservatism when it comes to information technology, the consumer-packaged goods industry's IT spending last year dropped to one of its lowest points in recent history. The industry spent 1.42% of its net sales revenue on IT, down from 1.56% in 2002 and well below the 1999 peak of 1.62% of sales.

But the good news for IT: Companies drastically boosted their capital IT investments in 2003, according to a report released Tuesday by the Grocery Manufacturers of America. The study, unveiled at the GMA's annual conference in La Jolla, Calif., says capital spending on IT rose to 0.82% of sales in 2003, up from 0.41% in 2002, and is projected to grow to 0.86% in 2004.

High on consumer-packaged goods companies' list of IT priorities for 2004 are investments in trade promotions and supply-chain planning, as well as manufacturing, distribution, and transportation initiatives.

Mandates from Albertsons, Metro Group, Wal-Mart Stores, and the Department of Defense have put the pressure on consumer-packaged goods companies to investigate and implement radio-frequency identification technologies. According to the study, 64% report that they are in the information-gathering stage with RFID, while 38% are designing RFID programs, and 19% are actively testing RFID. Also, 5% report they are piloting RFID with customers, while 2% are implementing RFID.

Conducted by Computer Sciences Corp. and called the "Grocery Manufacturers of America Information Technology Investment and Effectiveness Study: The State of the Industry 2004," the study is based on responses from 93 company executives representing 63 of the 119 GMA member companies and on quantitative and detailed surveys from 42 companies.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of Cloud Computing - Fall 2020
The State of Cloud Computing - Fall 2020
Download this report to compare how cloud usage and spending patterns have changed in 2020, and how respondents think they'll evolve over the next two years.
How GIS Data Can Help Fix Vaccine Distribution
Jessica Davis, Senior Editor, Enterprise Apps,  2/17/2021
Graph-Based AI Enters the Enterprise Mainstream
James Kobielus, Tech Analyst, Consultant and Author,  2/16/2021
11 Ways DevOps Is Evolving
Lisa Morgan, Freelance Writer,  2/18/2021
Register for InformationWeek Newsletters
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you.
White Papers
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll