Consumer Goods Supply Chain Research Articles

Machine Learning and Digital Twins-enabled Supply Chain Resilience: A Framework for the Indian FMCG Sector

Disruptions highlight machine learning (ML)-powered digital twins as a significant technology to ensure supply chain resilience (SCR). The authors acquired supportive data by conducting semi-structured interviews with 37 fast-moving consumer goods supply chain professionals. Using open, axial and selective coding approaches, the authors mapped and discovered the themes that constitute the essential elements of ML-enabled SCR. The findings of the research underscore four principal capabilities in which ML is poised to enhance the resilience of supply chains, namely (a) visibility, (b) supply chain analytics, (c) managing levels of inventory and (d) consumer behaviour. The research implications employ empirical data to demonstrate how integrating ML with digital twins into the supply chain enhances resilience and presents a comprehensive framework utilizing ML to improve SCR. The research draws upon the dynamic capability view theory.

Exploring the Challenges of Industry 4.0 Adoption in the FMCG Sector: Implications for Resilient Supply Chain in Emerging Economy

Background: Fast-moving consumer goods (FMCG) supply chains are experiencing various challenges due to the interactions between consumers and decision-makers during physical distribution, manufacturing, wholesale and retail. One possible strategy to address these challenges for smoothing the supply chain (SC) and logistics operations is to adopt Industry 4.0 (I4.0) based technologies in the FMCG business processes. In this regard, digitalization and automation of the FMCG supply chain can be strengthened by the alluring properties of I4.0 technologies. Methods: This study identified nine significant challenges through a literature review and expert validation. Later, the challenges were evaluated using a novel multicriteria decision-making (MCDM) framework, the Bayesian best worst method (BWM). Results: The findings indicated that “requirement for substantial investment and resources”, “incompatible technological infrastructure” and “poorly structured value chain” are the most significant challenges to implementing I4.0 in the FMCG industry. Conclusions: The study is expected to significantly contribute to improving the FMCG supply chain’s resilience, sustainability, visibility, traceability and responsiveness. Additionally, the research can provide industrial practitioners valuable insights into implementing I4.0 in FMCG and similar sectors and thus promote SC sustainability and resilience in those industries.

REVIEW OF BIG DATA IN FMCG SUPPLY CHAINS: U.S. COMPANY STRATEGIES AND APPLICATIONS FOR THE AFRICAN MARKET

This review explores the strategic utilization of Big Data in Fast-Moving Consumer Goods (FMCG) supply chains, shedding light on the approaches adopted by U.S. companies and the potential applications for the evolving African market. As technology transforms the landscape of supply chain management, U.S. companies are at the forefront of leveraging Big Data analytics to optimize efficiency, enhance visibility, and respond dynamically to consumer demands. The analysis delves into the specific strategies employed by U.S. FMCG companies, ranging from predictive analytics for demand forecasting to real-time tracking for logistics optimization. Furthermore, the review investigates the adaptability and relevance of these strategies to the unique challenges and opportunities presented by the African market. The exploration of successful case studies, challenges, and potential solutions provides valuable insights for both U.S. companies seeking to expand into Africa and local businesses aiming to harness the power of Big Data for improved FMCG supply chain management. The findings contribute to the ongoing discourse on the intersection of technology, global supply chains, and the transformative potential of Big Data in shaping the future of FMCG distribution across continents.
 Keywords: Big Data, Fast-Moving Consumer Goods, Analytics, Supply Chain Optimization, Demand Forecasting, Consumer-Centric, Data Security, Ethical Considerations.

Building Resilient FMCG Supply Chains in South Africa Amid Prevailing Load-Shedding Challenges

Load-shedding (the controlled interruption of electricity supply) has become a prevalent challenge in South Africa, and it has had a significant impact on the operations of fast-moving consumer goods (FMCG) supply chains. The goal of this study was to find ways of developing FMCG supply chains that are resilient enough to endure the negative consequences of prevailing power outages. The frequent and erratic nature of load-shedding poses serious issues for South Africa’s FMCG sector. An exploratory research approach was used to uncover six overarching themes in the midst of prevailing load-shedding challenges in South Africa. Semi-structured interviews were used to explore primary data from 25 supply-chain industry professionals, complemented by secondary data from industry reports and literature. In the face of persistent issues with energy supply, this study adds to the body of knowledge by offering FMCG companies in South Africa useful insights and practical recommendations for sustaining operations and achieving long-term sustainability. Furthermore, the findings can provide FMCG businesses in South Africa with useful tactics and information. This useful advice is priceless for operational effectiveness and business continuity planning. Although supply-chain resilience and uncertainty management are extensively covered in the current literature, there is a deficiency of research concentrating specifically on the FMCG industry in South Africa and its particular load-shedding difficulties.

An optimization model for the downstream supply chain network, considering consolidated warehouses and the selection of transportation mode

PurposeThe supply chain (SC) of the fast-moving consumer goods (FMCG) sector in India witnessed a significant change soon after introducing the Goods and Services Tax (GST). With the initiation of this tax, companies started moving from individual state-wise warehouses to consolidation warehouses model to save costs. This paper proposes a model that frames a mathematical formulation to optimize the distribution network in the downstream SC by considering the complexities of multi-product lines, multi-transport modes and consolidated warehouses.Design/methodology/approachThe model is designed as mixed-integer linear programming (MILP), and an algorithm is developed that works on the feedback loop mechanism. It optimizes the transportation and warehouses rental costs simultaneously with impact analysis.FindingsTotal cost is primarily influenced by the critical factor transportation price rather than the warehouse rent. The choice of warehouses at prime locations was a trade-off between a lower distribution cost and higher rent tariffs.Research limitations/implicationsThe study enables FMCG firms to plan their downstream SC efficiently and to be in line with the recent trend of consolidation of warehouses. The study will help SC managers solve complexities such as multi-product categories, truck selection and consolidation warehouse selection problems and find the optimum value for each.Originality/valueThe issues addressed in the proposed work are transporting products with different sizes and weights, selecting consolidated warehouses, selecting suitable vehicles for transportation and optimizing distance in the distribution network by considering consolidated warehouses.

A robust possibilistic multi-echelon multi-product multi-period production-inventory-routing problem considering internal operations of cross-docks: Case study of FMCG supply chain

Integrated and simultaneous decision-making is essential for the production, reproduction, storage, distribution, and cross-docking, especially in Fast-Moving Consumer Goods (FMCG) supply chains. In this paper, a production-inventory-routing problem (PIRP) is essential. We have addressed the PIRP considering four-echelon multi-product, multiple periods, and the reverse flow of defective products. The PIRP also considers the consolidation of the tasks of cross-docks. Robust possibilistic programming (RPP) and possibilistic chance-constrained programming (PCCP) model the demand uncertainty. Uncertainty performance metrics evaluate the proposed solution approaches. Meta-Heuristics, including Teaching-Learning-based Optimization (TLBO) and Invasive weed optimization (IWO) algorithms, solve the deterministic equivalence of RPP and PCCP. Results demonstrate the benefits of the developed models and the robustness of the solution procedures in a real-life FMCG supply chain.

The Effectiveness of Service Delivery in Fast Moving Consumer Goods Supply Value Chain: A Case Study of Brands Africa Zambia Limited Company

The study focused on analysing the effectiveness of service delivery in fast moving goods supply chains taking Brands Africa as a case study. Some observed supply chain related challenges of Brands Africa that included lower sales volume, high volume of product returns, sale of some expired products out of stock of some product lines and high prices of some merchandise made the study to be mandatory. A pragmatic research paradigm was used in collecting data from a cross-sectional survey sample of 87 respondents and a case study sample of 5 research participants using a survey questionnaire and an in-depth interview guide as research instruments, respectively. The study concluded that supplier contact was strongest on communication with suppliers, importing goods to Zambia and good relationships with suppliers. The study showed Brands Africa had good advertising and merchandising services, and effective marketing research activities in its supply chains The study established that quality of merchandise high, and market image and reputation of Brands Africa was high, and that inventory management, price of merchandise and efficiency of supply chains needed improvement. The study also concluded that there is a significant relationship between supplier contact and marketing contact activities of Brands Africa with the overall satisfaction of its stakeholders. The research recommends Brands Africa to upgrade its product, financial, information and social with its suppliers, transporters, wholesalers and retailers. The study will also guide managers on cost cutting ways, quality management, ensuring efficient operations and maintaining positive image of Brands Africa. The study recommended Brands Africa’s on policy issues like quality of merchandise, quantity of merchandise, price range of merchandise, delivery schedules and communication systems will be improved. The researcher recommends another research to be carried out at national level covering supply chain of other fast-moving consumer goods companies and also considering more independent variables.

Retailer‐to‐Individual Customer Product Supply Strategies Under a Semireal Demand Pattern

In the consumer goods supply chain, there are three different modes of demand: real, false, and semireal. It is an interesting topic to discuss the optimal profit of enterprises according to these three demand patterns. This paper develops three mathematical models that can be used to investigate the factors that affect retailers with respect to the design of product supply strategies for individual customers under a semireal demand pattern and thereby addresses the problem of retailers’ maximum profitability. The results of the present study show that these models may effectively help retailers develop appropriate supply strategies for individual customers under a semireal demand pattern; in turn, this may help retailers improve operational performance. The main contribution of the current study lies in the construction of mathematical models of product supply strategies for the individual customer in the off‐invoice mode, the scan‐back mode, and the unsold‐item processing mode under the semireal demand pattern. The effectiveness of the models has been verified through numerical calculations. In concrete management practice, the mathematical model given in this paper can be used to effectively adjust the quantity of goods purchased, correct retail prices, and optimize sales discounts to maximize profits.

Using PLS-SEM for assessing negative impact and cooperation as antecedents of gray market in FMCG supply chains: an analysis on Spanish wholesale distributors

PurposeWithin the fast-moving consumer goods (FMCG) supply chain, one of the problems facing the distribution channel strategy is the presence of the gray market. The article shows two novel antecedents of the participation of official distributors in this gray channel: Negative impact on distributor performance and the relationship with their supplier. Knowledge of this background helps to preserve the strategy outlined for the official distribution channel.Design/methodology/approachData were collected from 172 Spanish wholesale distributors and analyzed using PLS-SEM.FindingsThe authors found that the damage through negative affectation in the official distributor's performance and the cooperation provided by the manufacturer, have different effects. While affectation is shown to be a powerful antecedent of participation in the gray market, the effect of perceived manufacturer cooperation does not show strong results.Practical implicationsIn business practice, these findings lead the manufacturer to keep transactions carried out in the gray market at low levels and provide cooperation to official distributors to guarantee the official channel strategy aimed at efficiency in the distribution of branded goods.Originality/valueThe background of the gray market discussed in the study has not been previously analyzed in the literature. In this way, the authors contribute to the knowledge of such a common problem as the presence of the gray market in the segmentation of distribution channels of high-demand products.

The effect of planning horizon and information sharing on the optimisation of the distribution network of a fast-moving consumer goods supply chain

Background: The distribution network design is very important in optimising the supply chain performance and cost. There are different distribution policies that a company may have to select from, and consequently, the company should plan its resources and should select a planning horizon based on its choice.Objective: The main objective is to design the distribution network of a fast-moving consumer goods company in order to optimise the transportation and inventory costs by determining the quantities to be shipped and the resources needed. This is analysed throughout different planning horizons and distribution policies.Method: A mixed integer quadratic problem model is developed to optimise transportation and inventory costs by determining the quantities to be shipped, the quantities to be stored and the types of trucks to be used. The model is applied to four different distribution policies and the performance of each is tested across different time horizons.Results: An analysis is carried out to optimise the distribution plan for each policy. The effect of the length of the planning horizon on the different plans is also shown.Conclusion: The results show how each policy performs against the trade-off between the ease of using the policy and its cost of operation. Also, the length of the planning horizon is shown to drastically reduce the total cost and affect the operating conditions when the Vendor Managed Inventory (VMI) policy is considered.

Supply chain sustainability drivers for fast-moving consumer goods (FMCG) sector: an Indian perspective

Purpose: Sustainability in fast-moving consumer goods (FMCG) supply chains (SC) is receiving greater than ever attention due to the increasing awareness of sustainability challenges such as climate change and labor rights. A definite solution is to integrate sustainable supply chain management (SSCM) practices all through the upstream and downstream entities of SC. This study identified and compared the drivers for the implementation of SSCM practices in Indian FMCG sector.Design/methodology/approachA methodology based on Grey-Decision Making Trial and Evaluation Laboratory (DEMATEL), a hybrid multiple-criteria decision making (MCDM) technique and sensitivity analysis was used to envisage the complex causal relationships among the identified SSCM drivers and to identify the critical ones.FindingsThe results showed that regulatory and legislative pressure, competition pressure and innovativeness dominantly drive the implementation of SSCM practices in the upstream and downstream SC of the FMCG sector.Originality/valueThe study examined levers of sustainability in FMCG supply chains in an emerging market with most of the extant research limited to automotive and electronic supply chains.

Redesigning a fast-moving consumer goods supply chain considering social responsibility and logistical restrictions: case study in an Iranian food company.

Redesigning a supply chain network is an important strategic problem which affects network productivity, especially in varying environments. We propose a novel mathematical model for redesigning the network of a real company considering economic and social aspects. Strategic decisions of the model consist of opening new centers, selecting capacities from a set of discrete sizes, and closing or expanding capacities of existing centers during a planning horizon. Tactical decisions are involved with determination of product flows, facilities allocation, selection of fleet modes in terms of product types (i.e., frozen, chilled, dry, and ready meal) and fleet ownership types (i.e., self-owned or leased). The correlations and restrictions involved with multi-product supply chains, such as substitutability of products, the impossibility of transportation of some products together because of chemical effects or legal restrictions, and necessity of allocation of special fleets to some products because of specific holding conditions, are considered. Noting social responsibility aspect, an objective of this model is to minimize the maximum unsatisfied demand of added food banks to the network whose roles are feeding needy people. An interactive fuzzy programming approach is applied to solve the given bi-objective problem. Finally, useful managerial insights are derived from the results which show that more geographical diversity of facilities, using a new distribution strategy, and adding food banks as a new echelon can increase the productivity of the given network and makes it more responsible in terms of social responsibility.

Research on Supplier Collaboration of Daily Consumer Goods under Uncertainty of Supply and Demand

This paper establishes the decentralized decision-making model of consumer goods, the active collaboration model of consumer goods suppliers, and the decentralized decision-making model of customized consumer goods. Through formula derivation and simulation, the benefit and influence differences of the three modes are compared. This paper studies the influence of supplier’s active collaboration on the supply and demand instability of consumer goods and discusses the ideal value of supply chain inventory control. In China’s modern circular economy, the inventory control of the consumer goods supply chain is unscientific and nonstandard. We discuss a new inventory control method and study the ideal value of supply chain inventory control. It helps reduce the inventory shortage loss caused by the uncertainty of daily consumer goods, improve the efficiency of the supply chain, enhance the liquidity of supply chain inventory to achieve the purpose of increasing economic value. It has reference value for the inventory control of consumer goods in other countries and regions. The results show that under certain conditions, the horizontal collaboration between suppliers can improve the completeness of consumer goods. The collaboration between suppliers can reduce the hidden dangers caused by the uncertainty of supply and demand and significantly reduce the total inventory cost of manufacturers and improve profits.

Factors Affecting Channel Conflicts in the Value Chain of FMCG Sector

Marketing channels are a set of interdependent organizations involved in the process of making a product or service available to customers/consumers, for use or consumption. The channel members in a marketing channel include companies, distributors, wholesalers, retailers and customers. Channel conflict is when a member of the distribution channel perceives another member to be engaged in behaviour that negatively impacts the attainment of its goals. Marketing channel conflicts are of different types and there are vast variations in their intensity and scale. This study, therefore, aims to ascertain the factors that cause channel conflicts in the supply chain of the Fast-Moving Consumer Goods (FMCG) sector and their impact on the overall supply chain of their marketing. The study considers a wide variety of FMCG products such as processed foods, baked goods, fresh, frozen and dry goods, medicines, cleaning products, and office supplies. The geographical boundary of this study is the south Indian state of Kerala.A qualitative methodology is used in the study by conducting in-depth interviews of the different channel members in the supply chain of FMCG sector in Kerala. The Quota-sampling method was used to identify the sample to be interviewed. Further, a correlation and regression analysis are done to understand the most influential factors in marketing channel conflicts. The findings of the study revealed that the major factors causing channel conflicts, were damaged goods, late deliveries, miscommunication, poor packaging, very low margin etc. The study found that managing channel conflicts will ensure a more efficient value chain that will reduce the overall costs incurred by the channel members. The study aims to identify measures to tackle channel conflicts in the supply chain of FMCG sector and enhance its value.

Physical Internet: First results and next challenges

Physical Internet: First results and next challenges

TOWARDS AUTOMATED PACKAGING FOR E-COMMERCE LOGISTICS

TThe conventional supply chain of consumer goods uses corrugated boxes on pallets as the main principle for manipulation, storage and transport of the goods. Apart from dimensions the vertical compression strength is the most important selection criterion for the boxes. In the early days of e-commerce corrugated boxes have been adopted as parcel packaging. However in e-commerce boxes are manipulated individually. They are dropped, thrown, rotated, compressed in all directions, … although they are designed for vertical compression resistance. Additional packaging material is required especially in case of fragile goods. Different types of cushioning materials are being used. Often 5 cm of expandable polystyrene chips on all sides around a fragile product is recommended by couriers and insurance companies. Some types of these chips are recyclable but most types fragment easily in small parts that survive for thousands of years if released in nature. In this research an alternative cushioning method is proposed and compared to the polystyrene chips in terms of shock absorption. Five variants of the new method are studied. The cheapest variant turns out to be the best shock absorber as well. Moreover this variant can easily be produced fully automatically. Therefore the new method is considered extremely promising.

A study on using lean, agile, resilient and green index to assess the sustainability of Egyptian FMCGs supply chains

Sustainable or green supply chain (GSC) management has gained significant importance over the past few years in Egypt as global awareness on preserving natural resources and the environment have been increasing. Sustainable operations of the supply chain became an essential requirement for Egyptian products to enter the European and the American markets which are the two major exports' markets for Egypt. Therefore, this research would assess the leanness, agility, resilience and greenness of Egyptian fast-moving consumer goods (FMCG) supply chain by the use of the lean, agile, resilient and green (LARG) index proposed by Azevedo et al. (2016). This research will use the case study approach in assessing the practices of three major FMCG companies' supply chains. Conducting this assessment on a set of companies and to their supply chain will allow the researcher to benchmark the performance of the supply chain members; thus, highlighting the gaps and emphasising on the improvement opportunities.

Optimal design of low-cost supply chain networks on the benefits of new product formulations

Formulated products usually comprise a high amount of low-cost ingredients, e.g., water, which could be removed by concentration, and the resulting concentrated products could generate economic advantages, especially in long-distance transportation. This work examines the economic benefits of new product formulations resulted from a new process and product design technology through the optimal design of low-cost formulated product supply chain networks for different product formulations, including traditional formulations and new formulations via concentration. Based on mixed-integer linear programming techniques, an optimisation-based framework is proposed to determine the optimal locations and capacities of plants, warehouses, and distribution centres, as well as the production and distribution planning decisions, by minimising the unit total cost, including raw material, packaging, conversion, inventory, transportation and depreciation costs. In order to deal with the computational complexity, a tailored hierarchical solution approach is developed, in which facility locations and connections are determined by an aggregated static model, and a reduced dynamic model is then solved to determine the facility capacities and the production amounts, distribution flows, and inventory levels in each time period. A case study of a fast-moving consumer goods supply chain is investigated to demonstrate the economic benefits of new product formulations by implementing and comparing different production and distribution structures. The computational results from scenario and sensitivity analysis show that the manufacturing of final products, using a simple concept based on intermediate concentrated formulations produced at a centralised location, results in large supply chain benefits of an economic nature.

A Study on Using LARG (lean, agile, resilient and green) Index to Assess the Sustainability of Egyptian FMCGs Supply Chains

Sustainable or green supply chain (GSC) management has gained significant importance over the past few years in Egypt as global awareness on preserving natural resources and the environment have been increasing. Sustainable operations of the supply chain became an essential requirement for Egyptian products to enter the European and the American markets which are the two major exports' markets for Egypt. Therefore, this research would assess the leanness, agility, resilience and greenness of Egyptian fast-moving consumer goods (FMCG) supply chain by the use of the lean, agile, resilient and green (LARG) index proposed by Azevedo et al. (2016). This research will use the case study approach in assessing the practices of three major FMCG companies' supply chains. Conducting this assessment on a set of companies and to their supply chain will allow the researcher to benchmark the performance of the supply chain members; thus, highlighting the gaps and emphasising on the improvement opportunities.

An integrated strategic-operational supply chain network design: a case of consumer goods supply chain

This study is motivated by a real-world supply chain that expects unprecedented high demand for some of its products. The fast-moving consumer goods supply chain under study is characterised by a large number of supply points (manufacturing plants) and a limited number of warehouses. It operates under the 'avoidance of missed demand' policy. The aim of this research is to develop a large-scale supply chain model that can enable supply chain managers in general and the manager of this supply chain in particular, to function under various circumstances. The model is formulated using mixed integer linear programming (MILP). The proposed model is verified and validated to assure accuracy and credibility. Model verification is done by the aid of data generated for supply chain networks with different sizes using MATLAB software. Validation of the model's assumptions, structure and objective is done through intensive discussion with supply chain experts from industry and academia. The paper discusses managerial and practical implications of the model.