CPG Firms Face Uncertainty At Every Turn In The Supply Chain

This article originally appeared on The LeSaint Logistics Blog.

For most Consumer Packaged Goods (CPG) firms and supply chain executives within them, we are operating in an age of great uncertainty amidst omni-channel fulfillment demands…..

This is not to be confused with change or even concepts surrounding omni-channel fulfillment, because most companies are resigned to the reality of change and multiple channels as ever-present.  Uncertainty goes deeper.  In addition to the new political climate, uncertainty stems from the rapidly evolving business model fueled by the internet across procurement, supply chain and retail (ie. online, brick & mortar, etc.). Further, consumer messaging through social and digital media has disintermediated organized business. 

There are harbingers of change like Amazon, who have multiple models that consumers seem to love but can create difficulty for the manufacturers who sell to them.  Uncertainty also plays a significant role in jobs such as Forecasting.  In spite of better data tools to manage the process, it can nevertheless be highly unpredictable (and even irrational!), driven by customers who do not seem to have a strong handle on their needs.  SKU proliferation emerges, because of the newly prescribed customer needs and retailers attempts to differentiate themselves from competitors.  It also increases the importance of geo-targeting, changing the ways retailers and manufacturers work with each other to reach the common consumer.