It’s time to tear up yesterday’s profitable growth playbook. What bold moves will you make to own tomorrow’s performance?

Key takeaways

• Canadian consumer products companies have sustained revenue growth, but EBITDA growth has lagged behind global peers, in part due to unique structural challenges: slowing population growth, concentrated retail dynamics, and rising cost pressures.
• We believe leading companies can unlock ~0.5x–1.5x EBITDA growth, but this requires a fundamental reset in thinking instead of incremental changes.
• Future profitable growth requires a portfolio of moves: reshaping growth frontiers; driving agile innovation; unlocking demand through commercial execution; reconfiguring supply chains; and designing lean and dynamic operating models.  

As the consumer products industry continues to evolve and undergo unprecedented structural shifts, one thing is becoming clear: what worked yesterday will not work tomorrow.

In the absence of true innovation, companies have relied on population-driven volume growth and pricing, but these levers can’t be relied upon to deliver future results.

Why does this matter?

Over the past decade, Canadian consumer products companies have delivered revenue growth broadly in line with global peers (around 2% annually), but EBITDA margin growth has remained flat while global players expanded margins by roughly 2.5 percentage points. This divergence reflects Canada-specific structural characteristics that will increasingly shape future performance.  

To navigate this new reality, Canadian consumer products companies must rethink their strategies and adapt to the evolving market landscape.

Five unique profitability and growth factors

Our analysis highlights five key factors influencing profitability and growth for Canadian consumer products companies.

1. Changing demographics and slowing population growth

• Canada’s population growth has slowed, increasing competition for domestic market share and making international growth more important.
• Households are shrinking, with more Canadians owning pets versus having children.

2. Fragmenting and evolving consumer preferences

• Consumer behaviour is becoming less predictable, shifting from broad mass-market trends to more fragmented, personalized needs.
• Factors such as multiculturalism and new consumption patterns (including the rise of GLP-1 weight-loss medications) are creating a more complex mosaic of demand.

3. Rising costs and margin pressures

• Production, logistics, and labour costs are rising in Canada, while shifting trade dynamics pressure margins in a sub-scale market.
• Consumers are becoming more value-conscious, limiting the ability to offset pressures through pricing.

4. Changing power dynamics in the retailer-supplier value chain

• Retail consolidation and private label brands are challenging traditional manufacturer-retailer relationships.
• The rise of e-commerce and direct-to-consumer (D2C) models is expanding options for companies and fragmenting how demand is monetized.

5. Lagging productivity and innovation

• While global peers are rapidly innovating, Canadian companies often face scale constraints that limit R&D investment.
• In parallel, an aging workforce and new skill requirements are reshaping how work gets done.

Five levers to unlock profitable growth

In this shifting landscape, there are no silver bullets. Future profitable growth will require a portfolio of moves.  

Lever 1: Shape and prioritize the next growth frontiers

Create value by actively reshaping where your company plays: prune low-returning SKUs, focus investment on advantaged platforms, and selectively open new revenue pools beyond your core business.

In Canada’s low-growth, high retailer concentration market, this means shifting volume to higher-margin hero products, entering adjacent categories, and expanding into channels or international markets with better economics or stable demand.

What does this look like?

A leading Canadian food company identifies the fast-growing functional nutrition segment and pilots a sub-brand of health-focused snacks and beverages. Using a D2C digital platform, it gathers rapid feedback and first-party data to enable agile innovation. This targeted approach creates a new revenue stream in an adjacent category while maintaining focus on its core business.

Lever 2: Drive agile innovation with consumer intelligence

While innovation remains essential, the focus shifts to faster and more successful launches. Unlock value by improving hit rates, reducing wasted spend through faster failure and continuous learning, and sharpening propositions that increase velocity in the core portfolio.

As Canadian consumers fragment across demographics, needs, and preferences, advanced consumer intelligence and AI-enabled innovation can compress development cycles, strengthen product-market fit, and pull revenue forward.

What does this look like?

A leading Canadian natural health products company conducts consumer studies to align product and packaging development with consumer preferences and enhance brand loyalty. The company responds by launching product innovations that resonate with consumer needs (magnesium and ashwagandha products for sleep and rest and GLP-1 companion products) and preferences (gummy and chewable formats).

Lever 3: Unlock demand through precision commercial execution

With pricing power constrained, growth comes from better market execution and enhanced revenue capture. Value will come from advanced revenue growth management to clarify price-pack architecture, tighten price corridors, reduce promotional leakage, and shift the mix towards roles, packs, and price points that drive margin.

Closer collaboration with retailers, combined with more precise targeting and activation across retailer media networks and loyalty ecosystems, will drive higher conversion and help recover lost sales.

What does this look like?

A Canadian snack company, constrained by a few dominant grocers controlling shelf space, unlocks growth by partnering with retail media networks. Using advanced analytics, they identify niche consumer segments and launch targeted, premium snack lines through digital promotions. This bypasses the need for broad in-store rollouts and minimizes risk.

Lever 4: Reconfigure the supply chain to compete at scale

Near-term value can be created by optimizing plant and distribution networks and reducing logistics intensity. Companies can also improve manufacturing productivity through lean practices and targeted automation. Simplifying materials, recipes, and packaging helps lower total landed costs. Finally, enhancing forecasting enables companies to better capture sales.

Advanced technologies and AI (e.g., predictive planning, inventory, and sourcing analytics) will act as a force multiplier by improving forecast accuracy, accelerating scenario evaluation and simulation-based decision making, and enabling faster reconfiguration of flows.

What does this look like?

A major Canadian protein processor re-evaluates its processing and distribution footprint to better serve key retail and foodservice customers. By redefining plant roles, simplifying product flows, and rebalancing production closer to demand, the company improves service levels while lowering logistics intensity and operating costs, creating a more flexible, scalable platform for growth.

Lever 5: Design a lean and dynamic operating model to accelerate growth

As complexity increases, value comes from simplifying decision-making, reducing layers, and eliminating duplicated effort, while clarifying end-to-end accountability and decision rights around the organization’s primary centre of wealth creation.

Automation and next-generation delivery models shift large portions of back- and mid-office work to lower-cost solutions, while AI-enabled platforms create a leaner Selling, General & Administrative Expense (SG&A) base and free up capacity for growth and innovation.

What does this look like?

A leading Canadian food company adopts a two-speed operating model: its core business leverages automation and streamlined governance to scale efficiently, while a dedicated growth incubator team rapidly tests and launches new products like plant-based snacks and D2C meal kits. This approach enables the company to maintain profitability in its core operations while quickly capitalizing on emerging growth opportunities.

How Deloitte can help

The path to profitable growth for consumer products companies is shaped by strategy and execution, but also by leadership choices that guide focus, alignment, and discipline.

As leaders chart their path, they should ask themselves:

1. Are we united on our growth ambition and where to invest? How clearly have we articulated and embraced a shared vision for the bold actions required to achieve profitable growth?
2. In the face of market disruption, are we leading the charge in market repositioning or simply reacting to the changes others make?
3. To what extent is our leadership team shaping the future versus being anchored in analyzing past performance and managing current demands?

Deloitte helps leadership teams move from reflection to action by translating strategic intent into clear choices and disciplined execution.

We’re invested in the future of Canada’s consumer products industry and support companies as they navigate complexity and pursue growth. The next chapter belongs to those who act with purpose.

Reach out to our leaders to explore how your organization can seize the opportunity.