From phone cases to frozen foods, duct tapes to toilet rolls; the future of consumer packaged goods supply chains has fundamentally shifted — from product development through to delivery
Remember a not-too-distant time when pandemic-driven disruption had people out in droves, emptying supermarket shelves of canned foods and toilet rolls? Recall how swiftly shoppers replaced house brands they had stuck to for years with other, more readily available ones.
In rethinking operations, the customer remains at the core. For the consumer packaged goods (CPG) sector, that requires flexibility and responsiveness to changing customer expectations of personalisation, frictionless experiences and instant gratification.
CPG companies will need to consider a shift towards micro-supply chains, where last-mile value is not a last thought — and value is brought closer to the customer. They will have to turn their focus from siloes to synergy in inventory management, with an aim to serve customers more quickly.
Looking ahead: key considerations
Putting the customer first
To meet customer expectations and understand their ever-changing needs, businesses need to embed a customer-first mindset across their organisation. This includes shifting product offerings regularly to meet hyper-personalisation demands and leveraging advanced forecasting approaches to anticipate customer needs accurately.
Using platforms effectively
A mobile, digital future is here, and companies must tap technology to find new ways of connecting with consumers. Some strategies include harnessing non-traditional supply chain platforms to drive efficiency and agility in operations and integrating platforms to respond more quickly to demands, access new markets and introduce products faster.
Understanding the importance of sustainability
Environmental, social and governance factors are becoming a key differentiator for CPG companies as customers give increasing weight to brand purpose, reputation, quality, reliability and security. Supply chains can use sustainable technologies to verify the ESG credentials of products and services. Social media plays a key role in transparency and frequency of communication between brands and their customers. CPG companies can also combine databases to continuously monitor and ensure suppliers comply with global anti-bribery and corruption regulations.
Building a roadmap for success
To realise the future ambition of your supply chain, it helps to focus on three key areas to inform your roadmap.
Clarify your strategy
Consider how you can develop organisational capabilities around your supply chain — by building, borrowing or buying? How will you define an optimised target operating model across people, processes, structure, technology, data and governance?
Choose to diversify or streamline
While some CPG companies will find success in diversification, others will need to streamline product portfolios — identifying top priority stock keeping units by analysing consumer purchase data.
Compete through data
From a customer perspective, the precision marketing model on which CPG companies rely is all about combining data and context to understand who and where the consumers are on their individual customer journeys.
Companies need to ask themselves which is more profitable: delivering 1,000 cases to one customer, or one case to 1,000 customers?
Future-ready supply chain: consumer packaged goods report by KPMG
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