The consumer packaged goods (CPG) world is under pressure like never before. Rising global uncertainty, economic volatility and evolving consumer habits are forcing leaders to rethink supply chain strategies. For many, the future hinges on building agility, resilience and digital visibility.
One credible sign of this shift can be seen in a 2025 report by Researchscape, which found that companies are accelerating efforts to make supply chains more resilient.
Evidence of this shift is already emerging. A 2025 Researchscape report shows that many organisations are reshaping supply chain strategies with a clear eye on resilience. The “State of Supply Chain 2025” study notes that 60% of companies are restructuring operations to deal with tariff changes and wider market volatility.
Consumer behaviour is changing at the same time. In Europe, grocery retail saw volume growth sit at around 0.2% year on year while private label value share rose to 39.1%. This points to a steady move towards own brand goods driven by price sensitivity, shifting purchasing power or evolving expectations. Further research from NielsenIQ in 2024 supports this trend with value sales growth for private labels across several regions.
These pressures show that traditional ways of supplying goods are no longer dependable or efficient. This is why supply chain management of consumer goods is being reimagined with a clearer focus on what organisations need today. The aim is no longer to move products through a fixed process. It is to create a supply chain that can sense change, adapt in good time and deliver with consistency.
What Leading CPG Organisations Are Doing
Many CPG and retail organisations are responding to these pressures by investing in digital transformation across their supply chains. Their focus is on clearer visibility, faster response, greater flexibility and a more resilient operation. The “Supply Chain Reality Check 2025” report highlights this shift:
- A significant share of companies are investing in AI, automation and supplier diversification as they manage volatility and rising costs
- Almost half of respondents point to talent shortages as a limiting factor, particularly in areas such as AI, analytics and advanced supply chain roles
Retail behaviour in Europe is adding further complexity. Slower volume growth and a growing share of private label goods, mean that neither retailers nor manufacturers can rely on brand loyalty or volume driven growth in the way they once did. At the same time, online buying continues to reshape demand patterns. EU figures show that in 2024, around77% of surveyed internet users aged between 16 and 74 had bought goods or services online within the previous year.
For CPG businesses, this reinforces the need for digital supply infrastructures that can support reliable, quick fulfilment across multiple channels. The organisations that move in this direction are better placed to respond to shifting expectations and maintain consistency in a market that is still evolving.
What a Smarter And Digitally Transformed CPG Supply Chain Looks Like
With the right technology and a clear approach, a modern CPG supply chain moves well beyond traditional forecasting and warehousing. It brings together capabilities that help organisations respond to real conditions, not assumptions.
- Demand Driven Forecasting & Inventory Buffering: With the right technology and a clear approach, a modern CPG supply chain moves well beyond traditional forecasting and warehousing. It brings together capabilities that help organisations respond to real conditions, not assumptions.
- Supplier Diversification & Supply Chain Resilience: Many organisations are restructuring sourcing and supply networks to reduce exposure to geopolitical risk, tariff pressures or single supplier dependency. The aim is a more balanced and predictable supply base.
- AI, Automation & Data Driven Planning: These tools are being used to improve forecast accuracy, cut waste and support faster decision making. RELEX reports sustained investment in these technologies among leading organisations, reflecting their growing role in day to day planning.
- Omnichannel Readiness & e-Commerce Support: Digital supply chains must now support both traditional retail and online demand with equal reliability. With online buying at high levels across the EU this capability is no longer optional and is becoming a core part of supply chain design.
Strategic Priorities for Today’s CPG Leaders If you’re leading a CPG business or retail operation in 2025 or beyond, here are strategic priorities emerging from recent data and market signals:
#1
Technology and Data Infrastructure
Invest in systems that provide real time visibility across inventory, suppliers, logistics and demand signals. AI enabled forecasting and planning has value, yet it only performs well when supported by accurate, accessible data. Strong data foundations remain the essential first step.
#2
Supply Network Flexibility and Diversification
With ongoing uncertainty in global trade, organisations are looking at more flexible sourcing strategies. This includes building relationships with a broader supplier base and strengthening ties with logistics partners, to maintain continuity and adapt to changing conditions.
#3
Talent & Capability Development
Digital transformation depends on people who understand data, analytics, supply chain operations and organisational change. Addressing talent gaps early is proving vital whether that is through targeted recruitment, internal training or strategic consulting support.
#4
Omnichannel Fulfilment Readiness
With e-commerce penetration rising steadily, supply chains must support both traditional retail and direct to consumer delivery. That means tighter logistics coordination, faster fulfilment and robust data flows across channels.
How Birchman Can Help
At this point of change, many CPG organisations recognise that they do not have the in house expertise or capacity to drive complex supply chain transformation at pace. This is where working with Birchman can provide real value. With decades of SAP experience and a structured approach to transformation, Birchman supports organisations through the full journey, from strategy to steady state.
- A proven record in guiding organisations through major IT and operating model transformations, grounded in practical delivery experience.
- The ability to integrate supply chain, demand planning, inventory and compliance workflows within modern ERP platforms such as SAP Cloud ERP (S/4HANA), creating real time visibility and supporting informed decisions.
- Expertise that goes beyond system implementation, helping teams adopt new processes and ways of working so change is sustained.
- As the UK member of the United VARs alliance, Birchman provides access to global delivery capability with local market understanding across regions.
For many organisations, partnering with Birchman is the step that turns incremental progress into a meaningful shift towards a next generation supply chain.
Closing Thoughts
Digital transformation has moved beyond aspiration and is now a strategic requirement. Organisations that invest in resilient, data driven, flexible operations gain stability and a clear edge in a competitive market.
For CPG leaders working to build a smarter supply chain this is the moment to take considered action. With the right combination of technology, talent and partnership the next generation supply chain is entirely within reach.
If you are ready to explore what this could mean for your organisation Birchman can help you shape a clear and confident path forward. Let’s start a conversation about building supply chain resilience and agility in a market that continues to evolve.
FAQs
Question #1: How can digital twins improve supply chain management for consumer goods?
Ans: Digital twins allow CPG companies to simulate production, distribution and demand scenarios before making real world decisions. They help leaders test “what if” situations, reduce operational risk and model the impact of changes across the entire value chain. This supports more confident investment decisions and strengthens the supply chain management of consumer goods.
Question #2: What role does sustainability data play in next generation supply chains?
Ans: Sustainability reporting now requires detailed tracking of emissions, materials and supplier performance. A modern next generation supply chain uses digital tools to collect and validate this data automatically, reducing manual effort and compliance risk. It also helps organisations make credible progress toward net zero goals.
Question #3: How does cloud ERP support CPG supply chain digital transformation?
Ans: Cloud ERP provides real time data, flexible integration with partners and scalable analytics. These capabilities make CPG supply chain digital transformation faster, less complex and more cost effective. Cloud platforms also simplify updates, enabling supply chains to stay aligned with regulatory and market changes.
Question #4: Why is end to end traceability becoming essential for CPG businesses?
Ans: Consumers and regulators increasingly expect transparency about product origins, ingredients and environmental impact. End to end traceability helps companies respond to recalls quickly, protect brand trust and meet strict compliance requirements. It also enables more sustainable sourcing practices and improves operational resilience.
Question #5: What is the value of integrating sales and marketing data with supply chain operations?
Ans: When supply chains connect directly to sales and marketing signals, planning becomes more accurate. Promotions, new product launches and customer sentiment can be reflected in demand forecasts within hours. This alignment reduces waste, prevents stockouts and improves the performance of the supply chain management of consumer goods.
