By Richard Davis, CEO, Demand Chain AI
The Big Picture
Consumer packaged goods companies are facing fast-moving headwinds. Pandemic-era channel disruption, e-commerce acceleration, supply chain volatility and consumer tastes that change overnight: this is a new era that demands new strategies. Success no longer comes from scale alone. Instead, it’s about agility and context—a combination of innovative technology and deep CPG-specific know-how.
What’s Holding CPG Back
Data silos & chaos: Data pours in from every direction—retailer portals, distributors, field sales, internal teams—but rarely lands in a single place and often messy. The silos of data prevent leaders from seeing the full picture and the messiness creates a problem with creating a complete picture. This ultimately results in slow decision-making, missed opportunities and redundant work because teams can’t easily collaborate off a shared, clean dataset.
Wild demand swings: Modern supply chains are under enormous strain, dealing with unpredictable demand spikes and inconsistent inventory flows. Add fluctuating input costs driven by inflation or geopolitical disruptions and forecasting becomes guesswork. Companies risk lost sales or bloated inventory when their tech can’t keep up with market realities and continue to rely on manual processes.
Trade spend scramble: Trade promotions remain one of the largest marketing investments, but many CPGs still lack closed-loop measurement. Without rigorous post-event analytics, companies repeat the same mistakes—overspending on promos that miss ROI targets, with no mechanism for post-mortem learning or scenario testing.
Consumer demands: The bar keeps rising, with customers now expecting lightning-fast delivery, personalized recommendations and a seamless experience whether they buy online or in-store. Brands that can’t deliver lose share to those that can. Keeping up requires new tools and supporting processes to not just meet but anticipate evolving needs.
Sustainability pressure: Regulatory requirements around emissions and traceability are tightening (and consumers care, too). Keeping up with reporting and compliance can tie up valuable resources—unless automated, accurate tracking is in place.
Traditional Approaches are Not Enough
Big tech: Large enterprise platforms are feature-rich, but also complex and often designed for horizontal use across industries—not for the unique rhythms of CPG. Customizing these systems, updating processes to take advantage of the new system, and training personnel takes time, money and expertise CPG teams rarely have to spare. The result is often delayed rollouts, staff frustration and value that arrives too late.
Big consulting: These firms bring strategy and smart frameworks but often stop before execution. Their deliverables are polished presentations, but real change happens when plans meet day-to-day business. This disconnect means great ideas stall out in the handoffs between strategy and operations.
Internal builds: Building in-house offers control but at a high cost. These projects tend to be lengthy and drain key resources from already stretched teams. The result here is bespoke solutions that struggle to keep pace with tech advances, struggle to scale and inadvertently reinforce silos.
The Hybrid Advantage: Context + Capability
Domain focus: Partners fluent in CPG operations can translate industry complexity into actionable solutions. They bring a shared language, anticipate common challenges and adapt processes to best ensure successful adoption. Onboarding is faster, and projects align more closely to business realities, delivering change with less friction.
Agile solutions: A common pitfall is the tendency to prescribe fixes before fully diagnosing the ailment, spending time and money while never truly solving the core issue. By partnering with seasoned practitioners, you gain the expertise to conduct thorough root cause analysis, identifying whether the problem stems from data, process, people, or technology, resulting in a solution that is targeting the real underlying concern and delivering real results.
Embedded support: The best partners become extensions of the client team, working shoulder-to-shoulder through rollout and refinement. They aren’t just advisors; they’re present through every phase of the journey and take shared accountability for results.
A “Street Smart” Partner Pays Off
Practical analytics: Advanced analytics can parse multi-source demand signals—from point-of-sale to social chatter—to improve fill rates, minimize overstocks and reduce spoilage. The right partner helps move from reactive firefighting to proactive demand and supply planning.
Trade promotion science: Most CPGs overspend, under-optimize or both. Industry experts know the “what if” promo scenarios to run to quantify real ROI and suggest course corrections in real time. This means each dollar spent is more likely to drive incremental growth.
Enterprise planning versus true optimization: Enterprise planning focuses on forecasting demand, aligning supply with business goals and creating standardized plans across functions. True optimization, by contrast, seeks the mathematically best possible outcome given real-world constraints—such as production capacity, transportation costs, promotions, and service-level targets—at a granular level. While planning sets direction, optimization unlocks efficiencies and tradeoffs hidden in the complexity of the value chain, enabling CPG companies to minimize waste, maximize margin and respond dynamically to market volatility.
Sustainability tracking: Automated systems pull together emission, sourcing and compliance data from multiple touchpoints, making audit-readiness and ESG reporting streamlined and less resource-intensive.
The Bottom Line
To win in CPG, generic technology and generic advice simply are not enough. Success requires a partner who delivers both practical experience and deep industry context.
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You deserve a partner who doesn’t just add tech—but multiplies your CPG expertise, accelerates results, and stands by your side from plan to execution. Ready to explore what’s possible? Schedule a discovery session today.
