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Is One Supply Chain the Right Strategy?

Imagine taking the scenic route to work every day. Sure, the drive might be nice, but you might miss more morning meetings than you like. Depending on your daily schedule, taking the HOV carpool lane can get you to work faster and on time for those meetings. You may pay a premium to use it, but you’ll get there. Your choice is driven by the daily needs. Products are no different. Crafting faster “highways” for some products allow Consumer Products (CP) companies to quickly respond to demand unpredictability through a responsive, flexible supply chain – and ultimately get your product to its meeting with the consumer – on the shelf.

Different products with unpredictable demand need different supply chain options. Why haven’t CP companies selling through more traditional channels caught up with this revolutionary concept? Working with leading CP companies, Clarkston has been able to successfully implement segmented supply chains tailored to specific product characteristics and business objectives.

What the Consumer Wants

Studies show that consumer purchasing behavior varies across product categories. For example, the impulses, needs, frequency, and behavior predictability of a person shopping for laundry detergent look quite different from a person shopping for pet supplies. Consumer buying behavior not only varies by category, but also across the ever-changing consumer demographics. Yet these products – with such different paths to purchase – can all be found within the same store, many times within just a few aisles from one another. With the continuously growing portfolio of products now owned by CP companies, the same manufacturers make products in several different categories. Yet all products end up on the shelf, one way or another, ready for purchase.

Does the consumer care how they got there? Not really, as long as the products are on the shelf when they need them, how they need them and at the right price. How they arrived on the shelf doesn’t really matter. Whether they were shrinkwrapped on the same pallet, independently packaged directly from the manufacturer (DSD), or shipped through a series of warehouses and consolidation cross-docking points, the consumer just wants the product when they need it.

For more, please download our report.