If you Google the phrase “new normal,” you will either find posts supporting the theoryor posts declaring that there is no such thing. The truth is, whatever we may decide to call the variousCovid-19 changes, it cannot be denied that there have indeed been massive changes across all fields of business and life, and more are yet to come.
Since the consumer packaged goods industry is huge in US and has been immensely affected by those changes, it is time to consider whether you want to wait for the world to change back, or do you want to adapt and survive?
Adaptation is the Only Right Answer
Just like it has always been, adaptation is the right answer, if a businesshas to survive in this segment right now. Whether the world will change back in 2021 or not remains to be seen, but by avoiding the essential changes right now, CPG businesseswill suffer tremendous losses, from whichmost SMEs may not recover again.
Even if things do go back to normal again someday in the near future,adapting is absolutely essential to survive the present situation. Change has always been a constant factor in business, and sometimes unprecedented, universal changes call for faster than normal adaptive steps as well.
UnderstandHow the Pandemic is Affecting Your Industry First
In order to adapt, you must first understand the COVID-19 impact on CPG companies and how it is transforming the entire industry. The two highlight points to deliberate onwould be:
- Inconsistent and erratic purchase decisions
- A huge boost in online sales across various segments of consumer packaged goods
As you can see, the opportunity is there, but the erratic nature ofinconsistent consumer behavior makes it difficult to plan a well-defined, long-term marketing strategy right now. The strategies will, therefore,have to be dynamic in nature, flexible enough to adopt the necessary changes, as and when necessary.
Reevaluation Comes Next
Reevaluation of multiple, if not all departments, will be necessary, and each of the following deserves special consideration.
- Financial forecasts should once again be reevaluated to be in linewith the latest developments
- The same developments are to be taken into account for redesigning a new marketing strategy
- Ongoing plans and initiatives will need to be retracted/expanded/redirected
Failsafe Planning Should be Incorporated into a Flexible Strategy
Failsafe plans should be incorporated into a flexible strategy for manufacturing, stock building, marketing,sales and delivery. The failsafe plans themselves are to be designed on the basis of multiple possibilities, where each possibility will be given a probability percentage.This will allow for the possibilities to be ranked and planned for,in accordance with their probability of happening. The more resources a company has, the more possibilities it will be able to incorporate, of course, but even a small CPG business should have at least one or two failsafe plans in these uncertain times.
Perhaps the biggest mistake any CPG business can make right now is that of taking risks they cannot afford to take. While the biggest names in the business, such as Nestle and Procter & Gamble will already have long time strategies in place, it is ill-advised for the SMEs to follow in their footsteps. Keep your planning and operations small but conducive to making quick changes in scale instead.