The COVID-19 pandemic disrupted global supply chains, resulting in CPG companies developing strategies to address the challenges and stay resilient.
The last decade has seen an explosion of new products and hyper-personalization with an increase in online commerce. Furthermore, the pandemic also brought about a shift in consumer behavior, with an unprecedented number of consumers shopping online for the first time. Constantly innovating and moving quickly to meet the demands of an ever-changing supply chain landscape is more crucial than ever.
That said, the future of e-commerce for CPG companies is achieving same-day doorstep deliveries. According to a McKinsey study, “same-day delivery will account for billions of U.S. online sales or a quarter of the country’s e-commerce market in the next six years.”1
As demand dynamics change, the biggest challenge for consumer goods manufacturers today is order fulfillment.
Thus the questions every CPG leader is asking are:
In today’s competitive environment, an inability to fulfill orders could cost the CPG manufacturers heavily. Having the product in the right quantities, in the right place, at the right time is essential to improve forecast accuracy and to keep out-of-stock scenarios at bay.
With the switch to e-commerce or online shopping, it’s no surprise that customers today expect faster delivery times. The demand has now shifted to consumers’ homes, making it increasingly difficult to predict where the demand is coming from.
Inability to meet demand profitably and in the shortest amount of time possible results in a lost sale. Moreover, if the stock-out problem persists, you’ve also lost your customer!
With retail stores closed across the globe, the pandemic undoubtedly changed the retail business dynamics, resulting in millions of SKUs sitting unsold in the warehouses. The e-commerce platform began fulfilling consumers’ demands. But not all online retail stores were able to replenish their inventory due to the lockdown; thus, their products showed as out-of-stock on the retailer’s websites. Poor visibility into inventory and consumer demand led to brands losing millions of dollars in revenues.
It’s time to transform linear traditional supply chains into connected, scalable, intelligent networks.
CPG companies today are looking to gain visibility across the partner network and more collaboration that leads to order fulfillment. This necessitates the creation of a “value network with many-to-many connections, where business partners work together to fulfill an order without dependence on a single source of supply.”
Given the levels of demand fragmentation in today’s time, reinventing your supply chain to move inventory quickly from the closest supply source possible to meet the demand is imperative. As the digital revolution takes shape, CPG companies can also seamlessly unlock the transformative benefits of a value network.
This is where our Business Network platform comes in. It is a “multi-tenant platform that allows CPG manufacturers to create a peer-to-peer network of their business partners. This connectivity beyond their direct customers and suppliers helps plug demand-supply gaps in near real-time and maximize fulfillment.”
Read more on how CPG manufacturers can reap the benefits of our Business Network platform, from getting a holistic view of inventory to achieving supply chain resiliency.