CPG

Consumer Packaged Goods (or FMCG) have a global market in excess of €10 trillion and still growing with the emerging markets contributing near double digit growth. The multi-nationals and their well known global brands do still dominate the landscape, particularly the advertising spend,  but the market is demanding innovation, new packaging formats, shelf ready units and better prices. The size of the market allows for local and regional brands, who alongside the giants of the industry, are searching for and providing points of difference.

The industry has been built on manufacturing success, volume, quality and cost. Whilst many brands had historic homes for much of the 20th century, the last 25 years has seen regional relocation & consolidation of production, as distribution lanes have become secure and brands crossed borders. We have indeed seen this trend in temperature controlled and short shelf-life products as well as cans, jars and household goods.

Many regions have been serviced by the wholesale industry, typically distributors with rights over a number of brands that had been left with the issue of getting goods to market. As distribution agreements end many CPG companies have taken responsibility for distribution back to support margins but also to own the relationship with the end customer. This has changed the supply chain challenge, particularly the issues of location of inventory, cost of delivery, service to the local market mix and regions. This has happened at the same time as retailers reduced inventory and demanded more frequent smaller deliveries.

We have seen a number of issues related to these market changes:

  • Where to place inventory? at the factory, in the countries, in the regions of the country
  • How to place inventory? Own warehouses, dedicated 3PL, shared user 3PL, 4PL, Integrator, distributor
  • How much inventory to place?
  • How to service the local market? Major retail, independent retail, informal, wholesale: Major cities, regional towns, rural.
  • How to control inventory? Shelf-life, date rotation, track and trace
  • How to control inventory? Increased sku count, for market reasons, differentiation, acquisition, retail specific.
  • The use of co-packing, for promotions, smaller runs, retailer specific.
  • How to work with the needs of major retail logistics? Stock in their DC, cross-dock, break-bulk or direct to store, lower cost, regional SOPs
  • E-commerce, with the growth in this market, can we serve directly.

Graphene Partners has a range of skills and experience to support CPG companies, distributors, e-commerce distributors and LSPs to address these issues.