As consumers, we all expect Fast Moving Consumer Goods to be there when we need them. With the demand for effective product flows increasing, how are logistics providers playing a critical role in keeping store shelves full?

The Rise of FMCG Logistics

Imagine turning on a tap only to find there’s no water. This flow, or lack of it, is equivalent to the movement of the thousands of relatively low cost products we use in our everyday lives being interrupted.

We depend on the continuous availability of fast moving consumer goods, FMCG, to keep our own refrigerators, and cupboards full to the point we can get through the average day – every day.

Short supplies and interruptions in the food and beverage, retail, pharmaceutical industries and other sectors that rely on fast turnover eventually hit us where we live.

Without sufficient buffer systems in place to guard against future interruptions, are we going to continue to experience these hiccups regularly?

Some would call these problems growing pains, others would see these problems as opportunities to create better FMCG logistics related workflows.

The FMCG Industry

By its very nature, the FMCG market is incredibly competitive. With margins that are already tight, suppliers are finding it harder to maintain their market positions due to ever increasing demands on delivery times and dubious availability of raw materials.

When viewed through a practical lens, this perfect storm of supply and “I want it yesterday” demand is as mentioned, an opportunity. To solve the problems, FMCG businesses are finding ways to leverage the high-level infrastructure of third-party logistics services: outsourcing appropriate elements of their sourcing, shipping, warehousing, distribution and fulfillment services.

Which Products are FMCG?

Fast-moving consumer goods include but are not limited to common items such as:

• Beverages
• Packaged food
• Toiletries
• Cleaning and laundry products
• Personal care products
• Over-the-counter medicines
• Stationery
• Plastic goods
• In short, the majority of items you’d find in a national super-store.

Who Supplies the FMCG industry?

Major FMCG suppliers manufacture virtually any popular brand-name consumer goods product you can think of.

Here are just a few of the top suppliers in the FMCG industry:

• Nestle
• P&G
• Pepsico
• Unilever
• Coca-Cola
• L’Oréal
• Danone
• Heineken
• And many, many more

Top FMCG Suppliers

In 2019, the FMCG market’s biggest players reported revenues that had grown 3.9% from 3.4% the previous year.

If that doesn’t seem like much, let’s give you an idea of market size: the world’s top 40 FMCG companies alone generated a combined $1.13 trillion in sales for the 2019 fiscal year.

Further, according to Allied Market Research, the global FMCG market is expected to exceed $15 trillion by 2025.

Size of the FMCG Logistics Market

As of 2019, the global FMCG logistics market segment was valued at over $1 billion, and is expected to reach nearly $1.5  billion by 2027. From 2020 to 2027 the compounded annual growth rate has been projected to be 4.6%.

Luckily for ground based logistics companies, the roadways segment was the highest revenue contributor in 2019. When comparing modes of transportation, this accounted for over $43 billion, and is estimated to reach nearly $518 billion by 2027. That figures equate to a CAGR of 3.30% for the forecasted period.

Modes of Transportation and Projected Growth

FMCG and the Supply Chain

As we experienced recently at the tail end of the pandemic, any interruption in the hyper-sensitive FMCG supply chain sends shockwaves through the transportation industry. These delays ultimately manifested as empty store shelves and product shortages at unprecedented levels.

From a lack of truck drivers, to production shortages due to sickness, these ripples have been disastrous to the what should be a smooth flow of fast moving consumer goods from supplier through to consumer.

Alternative transport modes to support the global supply and demand changes are required to secure speed to market and to reduce the risk of delays. Regionalisation of supply and demand, with FMCG companies shifting their sourcing areas to markets where products are manufactured and sold.

Source: https://www.maersk.com/industry-sectors/fmcg

Focusing on regional areas implies the use of experienced local logistics companies that know their own backyards intimately. These 3PL partners also leverage their networks to enable the wheels of local commerce turn more efficiently.

FMCG Demands Intelligent Logistics Processes

FMCG brands depend on their suppliers being key assets in their overall business strategy. Defining the value of a vendor at the granular level is incredibly difficult, but there are certain indicators that in practice, will always point the way to building better returns on investment.

Efficient logistical processes depend on these main factors:

• Operational effectiveness – a combination of consistency of supply and speed-to-market.
• A best price strategy – setting prices that allow both supplier and customer a reasonable sustainable margin.
• Sustainability – consumers are increasingly savvy to environmental issues, and adopting low impact processes is also favoured by many government agencies.
• Quality – maintaining consistent quality, especially during fluctuations in demand.
• Technical expertise and innovation – without innovation and the skills to make it happen we wouldn’t have modern the conveniences we take for granted every day – brands must innovate or die.

How Do 3PL Systems Help the FMCG Industry?

Some opinions would have you think giving up any part of the FMCG supply chain is a step backwards towards devolution.

While it would be ideal to wholly own and control every aspect from manufacture to consumer, not all FMCG companies have the resources to set up such operations. Alternatively, these smaller companies stand a better chance of survival by outsourcing logistics processes.

Moreover, consider some of these items with high turnover rates have limited shelf-lives and can lose their beneficial properties over time. In such situations, the agility offered by logistics centres offers more accessibility to those same products for timely and effective order processing.

From a boots-on-the-ground point of view, the implementation of WMS technologies maximizes control over logistics processes. This greatly reduces the risk due to errors and ensures delivery times are met.

A product’s traceability along its entire supply chain path is essential in the FMCG industry. The ability to monitor inventory in real time through WMS (warehouse managements systems) common to most logistics providers is quickly evolving into a much more comprehensive SCM – supply chain management system.

For more on how your company can benefit from logistical expertise and warehouse management services don’t hesitate to contact Brimich today.

In a logistics industry that’s constantly evolving, how do pick and pack services remain an integral part of serving both businesses and end-user customers?

Small and medium-sized businesses all aim to be successful, but with new success and technologies come new problems. How do you ensure that your product is packaged accurately for delivery?

As we know, the fulfilment process is very sensitive, and the smallest mistake in packing or labeling can result in an item not being included, breaking or not reaching its proper destination. This is where modernized pick and pack services come to your aid.

The Obvious Question: What is a Pick and Pack Service?

The pick and pack service is simple in principle – products are picked then appropriately packed, yet it is a crucial step in the order fulfilment process. The first steep is collecting (picking) all products from their respective warehouse locations for a customer’s order. The next step is properly packing these items for shipping to the customer.

The underlying critical factors that influence the success of the process are speed, skill and accuracy. Inefficiency in any one of these areas will degrade customer experience down the line. For instance, if an order arrives damaged, late, or contains the wrong items, your customers are less willing to do business with or recommend you again.

In other words, through pick, pack and ship services, sold items are picked, packed safely and shipped with the correct shipping label and invoice.

The Pick and Pack Fulfilment Service at Work

The moment a customers’ order enters the system the picking process begins. Depending on the type of order, products are picked by the piece, in batches or in waves. With the help of an advanced warehouse management system (WMS), inventory counts are optimized resulting in efficient picking and faster product flows between storage and dispatch.

While modern technology certainly helps mitigate the chance of human error, manual quality control checks for quantity and quality are still used top monitor overall fulfilment accuracy.

Types of Picking

The picking process itself can be broken down into four main types:

• Piece or discrete picking –  As an or comes in, a picker handpicks each product to assemble a complete order.
• Batch or cluster picking – Similar to piece picking with exception that multiple orders are done all at once instead of one at a time.
• Zone picking – Items are often warehoused as similar types or in zones. Employees within these specific areas pick one order at a time within that area.
• Wave picking – A combination of both batch and zone picking. Employees stay within a given zone and pick more than one order at a time.

Specifics of Packing

Efficient packing starts with placing the ordered items into a suitably sized box. The box is then lined with packing materials to ensure the products reach their final destination in one piece.

Furthermore, packing should keep an order within the smallest number of boxes on the whole and make use of the most suitable type of packing material(s) for each product.

Maximizing these packing specifics results in reduced shipping costs, order accuracy, and a more cost-effective shipping process.

An ideal warehouse will be able to turn around orders quickly with a high rate of accuracy. Using better levels of quality control, the shipping process runs smoother and helps foster a high level customer satisfaction.

Pick And Pack Features And Benefits

Using a pick and pack service offloads an entire system from your business which in turn, allows you to concentrate on growth and further opportunities.

In other words, trusting a picking and packing fulfilment partner ensures better levels of customer care without the distractions of maintaining an in-house fulfillment process.

Features of a good picking service include:

• Multiple, strategically placed locations
• Use of a state-of-the-art warehouse management technology
• The ability to manage discrete, batch, cluster, wave and zone order picking capabilities
• Integration with popular ecommerce platforms and shopping carts
• Capability to warehouse, pick and pack a wide range of products
• Customizable srevices to suit individual client needs

Benefits of integrating with a pick and pack service include:

• Cost improvements throughout your supply chain
• Improved order-to-cash cycle time
• Scalability
• Increased supply chain responsiveness and adaptability
• Access to specialized warehouse process technology, equipment, and expertise

There is an Order Fulfillment Opportunity For Every Business

From large B2B operations to small entrepreneurs, a business that involves customer order-fulfillment can leverage the experience of picking and packing services without having to invest in warehouse facilities and equipment.

According to a recent market report, the pick and pack services industry, with the aid of automation, is set to reach over $106 billion by 2029.

Outsourcing these warehousing services to an experienced logistics partner also allows you to scale your inventory up or down as necessary.

Types of businesses that utilize pick and pack:

• Wholesalers and distributors
• Entrepreneurs and Ecommerce merchants
• National retailers that require centralized distribution
• Omnichannel retailers
• B2B and B2C suppliers
• Fast Moving Consumer Goods (FMCG) suppliers and retailers
• Parts and equipment service providers

Pick And Pack Warehouse Services Help Create a Complete Fulfillment Solution

With over 50 years experience in the supply chain industry, Brimich offers picking and packing as an integral part of the industries we serve: food and beverage, agricultural and chemical, retail and wholesale. With our state-of-the-art facilities located in Brantford and Etobicoke, we have the expertise, skills, and the technology to handle your businesses pick and pack strategy.

Whether your business is simple or complex, Brimich Logistics & Packaging offers a complete 3PL service portfolio that fits your needs. All you have to focus on is ensuring that the orders keep coming and your business continues to grow.

Packaging can have different applications, dependent on the stage of distribution that the product is in; the product has to go from the producer to the retailer, and from the retailer to the consumer.

Through its long journey, a product might require specialized packaging, so that it gets to its destination in perfect condition. But what that destination is will determine which type of packaging it will need. Here, we will explore the difference between consumer and industrial packaging.

Before understanding the difference between consumer and industrial packaging, however, it is important to know what roles the packaging serves in the product’s journey from the manufacturer to the consumer. Here are some of the functions of packaging;

• Market the product
• Provide information about the product
• Protect the product against damage and unsanitary conditions
• Contain the product, especially liquids
• Simplify transportation

What is industrial packaging and consumer packaging?

So what is the difference between industrial packaging and consumer packaging? Industrial packaging is typically used to deliver goods from the manufacturer to the retailer.

There are instances when the industrial packaging is also the consumer packaging. Take for instance animal feeds that come in sacks. The sacks are loaded to trucks from the manufacturer directly to the retailer, and arrive the same way to the consumer.

Consumer packaging, on the other hand, is the packaging that the product gets to the consumer in. This packaging goes from the manufacturer to the retail outlet, and finally to the consumer.

For example, a package of cookies that leaves the manufacturer arrives at the retail store exactly as it will be sold to the consumer.

Another vital difference between consumer and industrial packaging is labeling; they have different labeling requirements, such as in declaration of quantity, responsibility, and identity.

What are the three levels of packaging?

There are three levels of packaging:

• Primary packaging: Wraps the product directly, which arrives to the consumer as is. The main purpose for primary packaging is to preserve and protect the product.
• Secondary packaging: Used in addition to, or on top of, the primary package. This level of packaging markets the product, and also gathers the products for easy handling and sales. It can also be used to group the product.
• Tertiary packaging: Typically used in the transportation of the products from the producer to the retailer; it is also used to define the sales unit that the manufacturer uses to sell to the consumer. For instance, a crate or corrugated carton containing a certain number of units of the product within.

What is the difference between CPG and FMCG?

Consumer packaged goods (CPG) and fast-moving consumer goods (FMCG) are often used interchangeably, but the two terms mean different things.

FMCG are those goods that are used on a daily basis in a household, like soap, detergent, deodorant, and shampoo. CPG are items used less frequently in the household, like canned foods, spices, etc.