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Editor’s note: This is the second part of a three-part series exploring the impact of current fast-moving consumer goods (FMCG) trends on businesses and their supply chains.
As workforce dynamics evolve and technology advances, supply chains are under increasing pressure from manufacturers, retailers and their customers to do more with less. This means moving goods faster, smarter and more sustainably without increasing costs.
There might seem to be a catch: The demand for greater efficiency and performance often comes with higher costs. Yet, supply chain leaders are finding innovative ways to break the paradox and meet stakeholder expectations by deploying data, smarter workforces and automation to realize new efficiencies in the FMCG space.
While each business must tailor its approach to its unique needs, these emerging trends are helping some organizations successfully adopt them to create long-term value.
Today’s consumers expect more than fast delivery. They want transparency, reliability and personalized product recommendations. To meet those expectations, brands must drive change at an operational level, going beyond smart algorithms and customized marketing.
Recent research supports this thinking. EY reports that 88% of supply chain leaders view the supply chain as critical to customer experience. Yet among C-suite respondents, that number drops to 76%, suggesting a disconnect in how different parts of the organization perceive its value. The opportunity lies in shifting the narrative.
The supply chain can be a powerful driver of customer satisfaction, loyalty and growth. And, with the right data, executives can make that case more clearly.
In action, this involves embracing new technologies such as artificial intelligence and predictive analytics to forecast demand with greater accuracy, increase network visibility, and ensure that inventory is aligned with what customers actually want, where and when they want it.
How that data is captured depends on factors such as the brand’s strategic priorities, network complexity and internal capabilities. While technology is advancing rapidly, many organizations are still weighing their readiness to invest. A recent Bain & Company survey found that while 84% of executives in non-tech industries rank generative AI among their top five priorities, only 37% of CPG executives do the same.
For brands that aren’t yet ready to build certain capabilities in-house, leaning into a supply chain provider can offer an alternative. By outsourcing solutions such as traceability to a trusted partner, companies can access real-time insights into product temperature, condition and location tracking, without the capex or administrative burden.
Overall, growing digital and data-driven capabilities enable brands to better understand what’s happening across the supply chain, so they can personalize offerings, respond quickly to customer feedback and elevate their customer-experience programs.
As businesses adopt new technologies to enhance CX, they may also take a strategic look at their workforce as part of the equation by asking: How can we improve employee experience and growth while filling gaps and building new capabilities?
Blending human expertise with automation may be the answer.
Specialized roles, such as machine operators, quality control technicians and logistics planners are emerging to support automated systems across sectors. For instance, leading produce growers are introducing new technologies like robotic harvesters, AI-powered sorting systems, and precision irrigation to their workforce to enhance operational efficiency, consistency, safety and sustainability.
Automation is also becoming increasingly important to delivering on modern consumer expectations. It enables brands to respond with agility to shopper preferences, improve order accuracy and shorten delivery windows. Automation benefits both the business and the end consumer by creating a responsive and transparent network that delivers on time and in full.
With this in mind, upfront technical investments can be offset by long-term value creation and increased brand loyalty. It may also be a competitive differentiator for early adopters, as Gartner recently highlighted that two-thirds of organizations aren’t pursuing necessary aggressive redesigns of their manufacturing operations, despite growing expectations around the use of advanced automation.
For organizations looking to accelerate operational efficiency, partnerships may be a cost-effective approach. In the case of automated warehouses, manufacturers can collaborate with platform providers to ensure their equipment is compatible with conveyors and robotic systems, and work together on implementing AI-assisted inspections to maintain consistent quality standards. Doing this during the design phase prevents the need for costly retrofits down the line.
Standardization is also emerging as a key enabler for automation. Building on the example of platform providers, there’s an industry movement toward standardizing pallets across the end-to-end supply network. Some retailers are switching to block pallets for their automation-friendly design, four-way access and better load stability. While the transition takes some upfront coordination, businesses may tap long-term gains of cost savings, improved safety and scalability.
As supply chain leaders consider how to move forward with automation, it can be helpful to focus on areas with high labor intensity or variability. Piloting new solutions in these spaces allows organizations to test, learn and scale the right capabilities over time. With the right strategy, automation becomes less about a single investment and more about building a flexible and resilient network.
Embracing new technologies and automated systems through a strategic and collaborative approach supports both operational goals and evolving customer expectations. Businesses that are early adopters of these strategies set themselves apart from the competition and drive long-term value in the following ways:
Deploy supply chain data as a CX driver. Supply chain leaders who help improve network visibility, traceability and responsiveness are demonstrating the positive correlation between operational efficiencies and CX, creating a business case for further investment in this space.
Automate with intent. Prioritize automation in areas with high labor intensity or variability, turn to third-party partners for piloting and implementing new solutions, and foster a skilled workforce to increase output speed and accuracy.
Collaborate to scale. Align with partners on platforms, processes and standards to streamline automation, reduce complexity and enable scalable growth.
Drew Merrill is senior vice president of sales, marketing and customer growth with CHEP U.S.
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