According to a recent report by Deloitte on the state of the Consumer Goods industry and key imperatives for 2022, increasing transparency helping in regaining consumer trust was top of the list for several companies.
Trust and transparency are intrinsically linked. Consumer goods brands that are not open and transparent are at risk of losing consumers’ trust, according to nine in ten executives that Deloitte surveyed. According to the report, most consumer goods companies are making an investment to increase the level of transparency for consumers and other stakeholders.
Increased transparency requires meaningful insights to be derived from raw data
For consumer goods companies to be transparent to all stakeholders and consumers, data needs to be sensed and captured.
The data collected should be shared and processed with other data sources to derive meaningful insights. Sharing an abundance of raw uncleaned data is likely to result in the opposite of what these companies are trying to achieve.
According to Deloitte’s report, intelligence, artificial or otherwise, is needed to do this effectively.
This includes supply chain transparency
55% of the execs that Deloitte interviewed for this report, cited out of stocks of products as a key reason for losing consumer trust. Another 48% cited stock outs of certain flavours/varieties/pack sizes of the brand as a key reason for losing consumer trust. Out of stocks at stores cannot be solved without transparency across the product value chain. Furthermore, it is critical that retailers and consumer goods brand owners work with the same demand/sales predictions to collaboratively ensure that there is enough stock produced, bought and stocked at stores, to meet demand.
Increased flexibility in stocking
Increased supply chain transparency enables consumer goods brand owners as well as retailers to be more flexible with their stock keeping policies. Most companies these days follow a just in time stock policy. However, when there are production related constraints like raw material supply issues or shortages or labour constrains at manufacturing sites, it enables consumer goods companies to make an informed decision to keep more stock(raw materials and finished products) when possible for future contingencies.
If the constraints are on the logistics side, it enables retailers to make an informed decision to stock more in their warehouses to ensure they do not run out of stock.
Without an understanding of expected consumer demand based on real time data combined with where there are constrains in the value chain, it is impossible for the different stakeholders to make a decision on what needs to be done.
Consumer trust and supply chain transparency
Speaking of stakeholders, consumer goods companies need to regain consumer trust by increasing supply chain transparency. By increasing supply chain transparency and ensuring availability of stock at stores, consumer goods brands and retailers can regain the trust they lost with consumers who experienced availability issues at stores.
What’s more, it gives consumers confidence in any sustainability claims the brand/retailer makes. According to the execs interviewed by Deloitte, 84% of them feel that consumers lose trust when brands don’t meet consumer expectations on ESG initiatives.
If you’d like to learn more about how to increase supply chain transparency and derive meaningful insights regarding demand from available data, email me on email@example.com