A conversation between Ben McPhee (Total Negotiation Group) and Pedro Da Costa
Across the FMCG and drinks sector, expectations of supplier teams are shifting rapidly. From a retailer’s perspective, however, the shift is already well underway.
Cost-of-living pressures, evolving shopper behaviour, and increased scrutiny on trade investment have changed what “good” looks like in commercial conversations. This is no longer a volume-driven environment. It is a margin discipline cycle.
To explore what this means in practice, I spoke with Pedro Da Costa, drawing on his experience across Woolworths Group and Endeavour Drinks.
Ben: How important is it for suppliers to understand the retailer’s P&L?
Pedro: It’s everything. If you don’t understand how I make money, you can’t help me make more of it. The suppliers who can talk margin, stock turn, working capital and space productivity have a completely different conversation. You move from pitching products to solving problems.
There’s also a hidden cost of complexity. Every SKU adds cost, warehousing, replenishment, working capital. The suppliers who simplify that while still driving growth are the ones retailers value most.
Ben: What differentiates suppliers who create value from those who defend volume?
Pedro: Simple test: do they lead with the category or their brand?
The best bring a view on the shopper and translate it into a financial story I can act on. The rest focus on protecting facings. One builds partnership, the other triggers negotiation.
Ben: What does strong trade investment discipline look like today?
Pedro: Retailers see trade spend as an investment. Suppliers often treat it as rent, that’s where a lot of money gets wasted.
Strong discipline means clear objectives, measuring what’s truly incremental, and being willing to reallocate spend. That’s what builds trust.
Ben: When margin pressure increases, what mistakes do suppliers make?
Pedro: Panic discounting is the biggest one. It trains shoppers to wait for deals and destroys value.
Then there’s defending volume instead of protecting value. The better conversation is about mix, how you trade shoppers up, not down.
Ben: What defines the next generation of KAMs?
Pedro: Financial literacy is table stakes. What differentiates is thinking like a category strategist and connecting the organisation, bringing marketing, supply chain and finance into the conversation.
Ben: Final advice for supplier teams?
Pedro: Start with the retailer, not yourself. The best teams begin with what the retailer is trying to solve and build from there.
That shift from selling to solving changes everything.
From my perspective, the shift is clear.
Retailers are not looking for more activity or more promotions.
They are looking for suppliers who understand their economics, simplify complexity, and bring forward solutions that improve performance.
Retailers are no longer looking for suppliers who can sell more.
They are looking for partners who can help them run a better business.
At Total Negotiation Group, we build confidence in teams globally to lead the complete commercial conversation, from strategic planning to excellent execution, visit www.totalnegotiationgroup.com
Ben McPhee is a consultant at Total Negotiation Group, specialising in commercial capability and customer strategy across FMCG.
Pedro Da Costa, Former GM, Merchandising & Customer Value – Endeavour Drinks
Pedro Da Costa is a senior retail and commercial leader with experience across Woolworths Group and Endeavour Drinks, specialising in category strategy, pricing, promotions and customer value.
Total Negotiation Group is a Silver Partner of the Drinks Association.