- Food: Companies produce packaged, canned, or frozen non-liquid food items for humans and pets, like soups, snacks, and bakery goods.
- Beverages: This sector manufactures liquid consumables such as soft drinks, juices, and beer.
- Home and Personal Care: Companies create cosmetics, cleaning supplies, and personal hygiene products.
- Durable Goods: This sector produces long-lasting items like appliances, toys, and jewelry.
These sectors cater to both B2B and B2C markets, using channels like digital marketplaces and direct sales.
The main clients in the consumer products industry include:
- Retailers and Wholesalers: These businesses buy products in bulk to sell to consumers, playing a vital role in distribution across various markets.
- Restaurants and Food Service: They purchase food and beverages to prepare and serve, sourcing from manufacturers or distributors.
- Digital Marketplaces: Platforms like Amazon and eBay enable B2B2C transactions, allowing direct sales to consumers or through third-party vendors.
- Direct Consumers: Individuals buy products directly from manufacturers or retail channels for personal use.
- Subsidiaries and Small Acquisitions: Smaller branches or acquisitions of larger companies use consumer products in their operations, particularly in finance-led ERP scopes.
These clients cover sectors such as food, beverage, home and personal care, and durable goods, showcasing the industry's diversity.
Consumer products companies adapt to changing preferences and trends by innovating and updating products for sustainability, convenience, and personalization. They use technology and data to improve product development and supply chains, offering tailored experiences. Emphasizing sustainability, they reduce environmental impact and build trust. Navigating complex distribution channels, from digital marketplaces to direct sales, ensures wide accessibility. By focusing on customer-centric strategies and agile operations, these companies stay competitive and drive growth across sectors like food, beverage, home and personal care, and durable goods.
Challenges within the Consumer Products industry include:
- Focus on healthy and ethical food
- Rising ESG expectations and new regulations
- Supply changes due to climate and politics
- Increased production and shipping costs and delays
- Consumer hesitancy due to economic concerns
Key Consumer Products Industry Terminology
| Term | Explanation |
|---|
| Omnichannel | Understanding consumers and inventory across all shopping channels (primarily store and e-commerce). The goal is to reach the consumer at any location. Therefore, it is important for SAP to provide a unified shopping experience and to facilitate a best-in-class consumer experience. |
| Brick and Mortar | Physical stores are where customers can view, try on, and purchase items. |
| Pop-Up Shops | This type of retail attracts attention with its limited availability. Pop-up shops are short-lived and/or sporadically occurring. |
| Pop-Up Warehouses | Temporary locations, or physical stores that are now used to ship merchandise to a customer that has purchased via the web. |
| Clicks-to-Bricks | Pure online players are adding physical "brick-and-mortar" presence either organically (for example, Wayfair, Warby-Parker) or by partnering with traditional retailers (for example, Casper Mattress in partnership with Target). |
| Order Deliver Options | - Click and Collect: Also known as BOPIS (Buy Online, Pick Up in Store) allows shoppers to purchase items online and collect their merchandise in the store (in a predesignated area like lockers)
- BOSS (Buy Online, Ship to Store)
- BODFS (Buy Online, Deliver from Store)
Order Deliver Options have become more popular since COVID |
