CPG
Consumer Products Companies, Are You
Ready For 2010?
2009 painfully taught organizations the value of having a flexible, modular, agile supply
chain—from planning through to execution. Companies learned that being prepared for
uncertainty with the right people, processes and technology can be the key to business sur-
vival. CPG companies that have maintained and developed their talent, redefined their
processes and strengthened their supply chain capabilities can look forward to a rewarding,
yet challenging, 2010.
—Bruce Tompkins, principal of Tompkins Associates and executive director of Tompkins Supply Chain Consortium
he past year has been a year of “big changes to
big things,” like the downward spiraling
worldwide economy, unemployment and the
the global consumer products marketplace. Consumer spending
has also shifted market share to private-label products, which has
distinct impacts on many companies’ supply chains. Finally, T
unpredictable impact of consumer spending habits. While commodity prices are projected to increase, and product avail-
many indicators point to economic improvement and gradu- ability may also tighten in 2010, adding further stress.
ally reduced unemployment, spending habits for consumer
goods will be:
• Restrained as consumer confidence slowly improves;
• Focused on low-priced products at the expense of other
criteria such as quality and features;
• Directed at store branded products; and
Consumer products companies will have a challenging year,
but one that holds the promise of recovery and comeback for
those that have made supply chain excellence a priority.
The Outlook
In 2010, expect to see strong, supply-chain-oriented consumer
• Increased growth in product sales fitting a direct to product companies experience profitable growth, and weaker,
consumer model.
less capable supply chain companies falter. This is really not
At the same time, consumer goods companies face significant the story of the rich get richer and the poor get poorer, but
challenges to their already slipping margins. Compliance and instead a matter of preparation, building a solid foundation
product security issues will intensify as time passes. Consolida- and focusing on what is important for success with the con-tions in many industries will heighten competition, especially in sumer of 2010.
