Making A Plan When You Didn’t Plan for This
In a few short weeks, “business as usual” has become a thing of the past. Across the country (and around the world) we are in a situation that has not been encountered before in modern times. Even more unsettling, we cannot predict the duration or depth of this public health and economic crisis.
COVID-19 has created shifts in the consumer packaged goods industry that neither retailers nor manufacturers were prepared for. Unparalleled (and in some case irrational) demand has led to panicked shoppers, massive out-of-stocks, and starkly empty shelves in retailers throughout the U.S. A disrupted and distracted workforce across the entire supply chain is making it very difficult to ensure product availability to worried consumers and frustrated customers.
Our mission in the consumer packaged goods industry is to provide consumers ready access to food and other household essentials, even during difficult times. Never has nimble planning, based on an understanding of all available data, been more important.
The food industry is unable to meet the demand for the foreseeable future. The government has communicated this with our industry by enacting policies that deems food manufacturing as essential. Retail promotions are exacerbating current circumstances when it comes to meeting the surging demand for food, OTC medications, personal and home care products. We strongly recommend that brands cancel or postpone promotions for the next three months for a number of reasons:
There is not enough supply at any link of the supply chain, most importantly there are widespread out-of-stocks at-shelf.
This will eliminate promotionally driven spikes in volume which the supply chain cannot handle.
Removing promotions will help steady the flow of inventory with an aim at improving in-stock rate throughout the supply chain.
A temporary hold on promotions preserves trade budgets for redeployment once things settle down.
This also might be a good time to put a process in place to identify any outlying orders that would put disproportionate inventory at any one customer. This doesn’t have to be formal allocation, but a means for monitoring as you move forward.
The truth of the matter is that all of us are in the same boat and that we can emerge from this crisis stronger than before. Most retailers, distributors, and brokers are ready to work to achieve viable solutions for all. So, get on the phone or video chat, start communicating with your partners, and redefine successful outcomes in this “new normal.”
As a trusted partner with decades of experience, Omnium is here to offer assistance in a shifting landscape when it comes to monitoring, measuring, planning – and re-planning – as a way of staying in control, no matter what comes next.
How is your company managing through this?
Contact us and let us know.