Driving Supply Chain Excellence in Consumer Products
source link: https://www.gartner.com/en/supply-chain/topics/consumer-products-supply-chain
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New SKU strategy reduces supply chain risk, optimizes capacity in CPG industry
Reducing product variety is good for supply chain agility. But managing SKU complexity is even better. New research from Gartner profiles the consumer products supply chains that are reimagining portfolio management and improving profitability as a result.
Download the report to learn:
Seven ways to improve your SKU optimization process
How to work with business partners on SKU retirement and SKU development
The top 5 barriers to consumer products supply chain success
Success in the CPG industry demands agile supply chain management
To support dynamic industry shifts, the consumer goods supply chain is accelerating transformation, particularly around digitalization, increasing resilience and adapting operating models.
- ESG Progress
- Supply-Chain-Led Growth
- Digital Talent
Their ESG commitment unmatched, CPG supply chains must now scale sustainability
Consumer products companies are leading those in other sectors on prioritizing and collaborating for supply chain sustainability.
CPG is a standout industry in the usage of sustainable materials for recycling: 55% of CPG supply chains are already investing in this area compared to an overall average of 47%. As a package-dominated industry liable for a large percentage of consumer waste across the globe as well as from their own manufacturing waste and supply chain issues, CPG has taken a strong position to not only use raw materials responsibly, but to also reduce packaging overall.
Another notable area of supply chain transformation where CPG is pulling ahead of other industries is sustainable sourcing: 56% of consumer products companies (versus 46% overall) are exclusively choosing suppliers and vendors with merit in ESG principles and performance. Consumer products companies anticipate customer expectations for social and environmental impact across the breadth of the value chain, not just a discrete enterprise’s supply chain; this includes how products and services are sourced, made, packaged, delivered, returned and destroyed.
That said global chief supply chain officers (GCSCOs) must prepare to transition from ambitious action to authentic achievement of social responsibility and environmental sustainability. CPG lags the overall average in sustainability‑as‑a‑service business models: Overall supply chains had a 43% investment rate, whereas CPG supply chains had a 38% investment rate in circular ESG capabilities. Consumer products companies fall short of the overall average in two other ESG capability investments: remanufacturing and used product take back/returns. Success will require a balanced portfolio of incremental and transformational investments in supply chain sustainability.
Drive stronger performance on your mission-critical priorities.
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