Emerging markets have been strongholds for big consumer-packaged-goods brands like Colgate, Avon, Axe, and Olay, which are backed by large, incumbent companies. But this need not be the case. So far, supply chain leaders have had the greatest success with simple plug-and-play solutions for specific supply-chain issues. We asked our survey participants a number of quantitative and qualitative questions, and we ranked their performance on specific metrics. Since the annual revenue of most privately held consumer goods companies is not available, CGT’s Top 100 list only includes publicly traded companies. For an unexpected example, pet welfare is an increasingly important subject with the, . featuring organic and natural ingredients, creating a massive market opportunity for CPG companies in the new year. The mission of the Mindful Awards program is to honor conscious companies and products … All rights reserved. Aggregating data from more sources and employing artificial intelligence (AI) and machine learning-powered analytics platforms to predict future demands will help data-driven CPG companies increase sales, solidify market share, and engage consumers in ways they (and their competitors) could never have in the past.Â. The Grocery Manufacturers Association represents the world’s leading consumer packaged goods companies. Â, CPG companies emphasizing multi-channel buying experiences with a heavy focus on online shopping in the new year will enjoy a significant advantage over those that choose not to adapt to changing buyer behaviors. For many brands, the beginning of a new calendar year is a logical time to hit the reset button. And the brands that employ. Boston Consulting Group is an Equal Opportunity Employer. The start of each new year is a convenient time to assess the successes and failures of the previous year and lay out a new vision (and products or services) for the business and its customers. The 64-page 2019 Online Consumer Packaged Goods Report examines the ways CPG manufacturers are building their ecommerce businesses using strategies that include working with online retailers, selectively selling directly to consumers and collectively spending billions of dollars on strategic acquisitions of upstart brands like razor maker Harry’s Inc. and snack brand Graze. Yet solutions of the latter type could have the largest impact on supply chain results. By John Knapp, Alicia Pittman, Elfrun von Koeller, Michael Hu, Arnold Kogan, Rajesh Shetty, Ankur Bansal, and Grace Havlin. Dollar sales of private label consumer packaged goods in the United States grew by 3.8 percent in 2019. The following is a summary of the most influential factors shaping the CPG sector today. This year, however, growth enablers have become much more prominent on the priority list, putting greater pressure on the supply chain to perform and highlighting issues related to service levels, inventory, and trucking capacity. Second, they are increasing their asset utilization, in terms of both volume and weight, by working to moderate demand, improve their use of drivers, and optimize truckloads. However, only 15 of them enjoyed double-digit gains – and to post that level of growth, nearly all needed to undertake significant acquisitions. Explore the NL findings. © Boston Consulting Group 2020. One CPG company is partnering with a leading provider of demand-­planning solutions to improve its forecasting technology and boost customer service. In the CPG realm, market domination is bolstered by brand recognition from years in the business, deep pockets, and enormous workforces of intelligent and highly-skilled employees. According to this study, over the next five years the Consumer Packaged Goods (CPG) market will register a 3.1%% CAGR in terms of revenue, the global market size will reach $ 2077590 million by 2025, from $ 1838640 million in 2019. Consumer electronics, food products, and other consumer packaged goods get everyday men and women excited about what they can spend their money on in the coming year. Each new year, consumers eagerly anticipate new products hitting the market. And increasingly this technology is available to large and small companies. As a result, about 80% of the retailers’ customers now get the SKUs they seek, which has caused customer satisfaction to rise noticeably. Â. CPG companies emphasizing multi-channel buying experiences with a heavy focus on online shopping in the new year will enjoy a significant advantage over those that choose not to adapt to changing buyer behaviors. The sales value of national branded consumer packaged goods grew by 1.9 percent that year. Traditional production, sales, and marketing positions will still exist and need to be filled. Millennial consumers have shown a preference for brands who “do good” or tackle societal issues important to the consumer. These include, for example, digitally enabled sales and operations planning, demand sensing, and digital supply-chain segmentation. In response, many companies are repositioning themselves (and their products) as champions for causes their customers care about. If you want great information about the future of CPG brands and what that will mean for business owners, you have come to the right place! Meanwhile, for those hoping to fundamentally improve their performance, digitally enabled solutions are becoming increasingly important. OAKLAND, Calif., Feb. 19, 2019 /PRNewswire/ -- The Clorox Company (NYSE:CLX) was ranked No. One factor is … The world already produces billions of bytes of data each day, and the companies that capture, analyze, and mobilize it will win in 2019. As digital technologies steadily become cheaper and more effective—and as pressure rises on all sides of the business—the case for digital transformation of the CPG supply chain becomes increasingly compelling. Online buying is rapidly becoming the norm for consumers in the Netherlands. First, they are reducing delivery distances through routing optimization, greater use of backhauling, and network redesign. Stern CSB Sustainable Share Index: Research Overview In an environment where consumer packaged goods (CPG) companies are responding to changing generational expectations, including more sustainable product offerings, yet where understanding of consumer purchasing trends is limited, the NYU Stern Center for Sustainable Business partnered … TORONTO – More than twenty Canadian retail and consumer packaged goods companies, representing a substantial proportion of the nation’s plastic packaging, are among the first to support new global “Golden Design Rules” to improve plastics recycling and reduce landfill and pollution. In response, many companies are repositioning themselves (and their products) as champions for causes their customers care about. No one is ready to claim that brick-and-mortar retail is dead. Nearly 50% of consumers — including over 55% of GenX and over 40% of Baby Boomers — now shop for consumer packaged goods online, a trend that shows little sign of slowing down in 2019. Supply chain leaders among consumer packaged goods (CPG) companies in the US are feeling tremendous pressure in 2019 as the industry continues to undergo seismic changes. Growth in measured channels, defined as multioutlet and convenience (MULOC) retailers—food, drug, mass, Walmart, club (excluding Costco), dollar, military, and convenience outlets—continued to decline, dropping from 1.5% to 1.2% over the past year. These constraints have resulted in higher logistics costs for CPG players. Global Product Lifecycle Management Consumer Packaged Goods and Retail (PLM CP&R) Market report is the comprehensive study of current and future industry analysis, growth factors & forecast 2019 … 10/10/2019 10:57 AM EDT . Organizations committed to data-driven decision making spend considerable time and resources throughout the year gathering deep-dive insights to project what customers are going to want in the coming year. In addition, retail grocery chains are ordering more often and in smaller quantities, boosting order volatility. BCG was the pioneer in business strategy when it was founded in 1963. Research & Analysis. Fast-forward to today, and the challenges remain. Insights about top trending companies, startups, investments and M&A activities, notable investors of these companies, their management team, … (See “About the Study.”). Consumer Packaged Goods Practice. Whether it’s Amazon Prime, meal kit services, or any number of the newly-introduced grocery delivery services, consumers increasingly prefer to, have their goods delivered directly to their home. Yet accurate demand forecasting and effective demand planning remain a challenge. Whether it’s Amazon Prime, meal kit services, or any number of the newly-introduced grocery delivery services, consumers increasingly prefer to have their goods delivered directly to their home. Another has announced a new demand-­forecasting tool that will enhance its predictions by integrating with its ERP system to include more data sets. Retail home delivery has been a smashing success for early adopters, and in 2019 everyone from global coffee chains to popular pharmacies and regional grocers will launch and expand their delivery service options. Many of the CPG companies that we interviewed believe that they’ve reached the limits of what they can achieve alone and that further improvements will require downstream collaboration with retailers. Consumer packaged-goods CEOs are a breed at risk: As many as 15 CEOs of the largest food companies have been shown the door since 2016, including the CEO of Kraft Heinz. Nearly 50% of consumers —, including over 55% of GenX and over 40% of Baby Boomers, — now shop for consumer packaged goods online, a trend that shows little sign of slowing down in 2019. .Transparent packaging is on the rise, with glass and clear. As online retailers Amazon.com Inc. (No 1 in the Internet Retailer 2019 Top 1000) grabbed market share in other … If there’s anything the industry has learned about its consumers in the past few years (coinciding with the rise of the millennial consumer), it’s that today’s buyer values transparency in business operations and sustainability in the products they buy. 2019 will see CPG companies who’ve already embraced data-driven operations and multi-channel consumer engagement expand their efforts in each area while late adopters ramp up their digital efforts in hopes of catching up. INFOGRAPHIC: AI in Consumer Packaged Goods. The Consumer Packaged Goods have a shorter shelf life as they are majorly perishable in nature and the quality of the products deteriorates very quickly due to the environment and time factors. Supply Chain Management, In fact, weekly sales-order volatility increased from about 28% in 2013 to about 45% in 2018. Approximately 26% of the CPG companies we surveyed said that “digital in the supply chain” is a top priority for the business, and about half reported piloting 15 or more digital use cases. Moreover, sales … This escort has some of the products that include meat, fruits, pre-packaged foods, soft drinks, chocolates, drinks, alcohol and many more. March 11, 2019 1. CPG companies are just as eager to meet — and hopefully exceed — customer expectations. Such point solutions tend to be relatively straight­forward to implement, require relatively ­little cross-functional coordination, and are generally limited in scope to one area of the supply chain. Yet growth in trucking capacity has not kept pace, and driver shortages are exacerbating the problem. The statistic shows the value of the consumer packaged goods software market worldwide from 2019 to 2024. Pet owners view their pets more as members of the family than as a possession and will aggressively seek out. Here are the top trends to watch for in the CPG world in 2019.Â. To combat these pressures, CPG players are improving their forecasting algorithms and capabilities. The consumer product industry in Africa experienced a challenging year in FY15. Companies are using three key mechanisms to address this issue. Unfortunately, many of the pilots have been less successful than the companies had hoped: almost half have had little or no impact, and 34% have had only incremental impact. MktoForms2.loadForm("//app-sj09.marketo.com", "663-IGN-570", 1888); ©2020, Spring Mobile Solutions On the service side, for example, median on-time delivery—as measured by the requested arrival date—fell to 87.1%, a drop of 2.7 percentage points, from 2016 to 2018. Supply chain leaders among consumer packaged goods (CPG) companies in the US are feeling tremendous pressure in 2019 as the industry continues to undergo seismic changes. The report also … This 2019 study, one of a series released over the past 10 years, is based on in-depth benchmarking of leading CPG companies and retailers by the Grocery Manufacturers Association (GMA) and Boston Consulting Group (BCG). The company resolved the issue by creating a big-data engine—a software tool that inputs billions of proprietary and publicly available data points into an in-house demand-­sensing algorithm developed to optimize business decisions. And when companies don’t clearly link the vision for this transformation to their strategic needs and business goals, the effort tends to stall. This effort covers US CPG manufacturers, excluding food services, with assessments of their warehouse-based supply chains and the impact of digital technologies on those supply chains. The acquisitions pushed global revenues up nearly 6% across the board, translating to billions of net-new dollars across categories. CPG brands are finding that they need to get more creative in the battle for market share. Although these challenges arise externally from retailers, greater focus on top-line … Pet owners view their pets more as members of the family than as a possession and will aggressively seek out up-market, high-quality pet food featuring organic and natural ingredients, creating a massive market opportunity for CPG companies in the new year. For more information, visit gmaonline.org. In response, many CPG companies are eyeing digital transformation as a way to address these challenges and support future growth. The consumer landscape is ever-changing but one thing remains the same: for companies to emerge on the other side unscathed by turbulent changes in the industry, they must keep their desire to create meaningful, memorable connections with their core consumers always front and center. For an unexpected example, pet welfare is an increasingly important subject with the $200 billion-per-year millennial cohort. In many instances, not surprisingly, customers couldn’t find the items they wanted, leading to sales losses, increased logistic costs, and unhappy ­retail partners. Will Old School Field Reps Become Obsolete? AI is enabling these companies in a variety of ways. On the inventory side, the average DIOH for finished goods increased from 35 to 37 for ambient goods and from 13 to 17 for refrigerated goods over the same period. They take the lessons learned over the previous year to rejuvenate mature or stagnant products with new ingredients or formulations while planning the launch of brand new ones. Our most recent previous study, published in January 2018, revealed that a powerful transition was already taking place in the industry—a transition linked to a growing pool of online retailers, convenience stores, and food service businesses, with diverse formats and high service expectations. With the right attitude, supported by the right digital tools, the consumer packaged goods industry is set to become more and more sustainable. GMA’s mission is to empower the industry to grow and thrive. replacing environmentally troublesome petroleum-derived plastic packaging. Such complex solutions require complex change, includ­ing a strong commitment to trans­formation throughout the organization, a vision for the digital supply chain, extensive cross-functional coordination, targets tied to business priorities, and a robust transformation agenda. The high consumer demand is also one of the prime reasons for the fast moving of such goods and products. They face rising competition from a growing number of alter­native retail-grocery formats, as well as increasing product proliferation and growing consumer demand for fresher products. It’s hard to overstate the importance of data. Despite an average wage increase of approximately 10% over the past two years, the driver attrition rate for large carriers has risen by about 20 percentage points. The CPG world in 2019. positions will still exist and need to get creative. Response, many companies are going beyond merely updating flatlining products and reinventing themselves and maker... 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