Executive Briefings

Greater Adoption of Standards Needed in Consumer Goods, Retail Industries, Report Finds

Wider adoption of standards is key to supply chain efficiency and meeting new consumer needs, according to a report entitled The Future of Standards in the Consumer Goods & Retail Industry: Cut Costs and Meet New Consumer Needs. The authors call on the industry to introduce simplified programs to help users embrace and deploy standards while enabling provision of standardized product data to consumers.

The report was released by Capgemini Consulting, the global strategy and transformation consulting arm of the Capgemini Group, together with GS1, the global standards organization, and The Consumer Goods Forum, the consumer goods industry platform.

Since the first barcode was scanned in 1974, standards have led to huge savings for the consumer goods industry allowing more efficient flows of goods and information. As consumers today become empowered through social and mobile technologies, they increasingly require real-time product updates and the ability to scan barcodes to obtain "beyond the label" data such as product origin, ingredients and manufacturing working conditions.

The results of the study showed that there are numerous challenges regarding standards faced by the industry, including:

1. Underuse of standards - Compared to large companies, small and medium-sized enterprises have significantly lower rates of standards use, with manual processing frequently the norm. Standards need to be extended to new channels such as e-commerce and affiliated transportation and logistics parties. 

2. Data available through product barcodes is often missing or inaccurate and not provided in a standardized way across multiple channels.

3. Promotions are problematic as they are necessary for sales growth but difficult to forecast demand as retailers are often unwilling to share promotional strategies.

4. With the challenge of Big Data, retailers and manufacturers find it difficult to respect standards that require barcode numbers to change every time a product is slightly altered.

5. There is increasing scarcity of natural resources but also rising consumer interest in sustainable business -- creating the demand for more accurate and consistent information on carbon footprint, water usage, recycling and energy consumption.

Key recommendations are:

"¢ Develop marketing programs targeted toward companies not making full use of standards

"¢ Introduce simplified standards programs for ease of adoption

"¢ Use existing standards to communicate product information to consumers

"¢ Collect sufficient information about product origin and route to market to minimize risk

"¢ Develop solutions to ensure data quality

"¢ Design new standards to facilitate the exchange of sustainability related data 

"¢ Expand GS1's role from standards defining body to center of excellence in standards deployment

The latest study was based on in-depth interviews with leaders in supply chain and IT functions of 20 global consumer goods manufacturers and retailers worldwide, across Europe, Asia and North America, including Johnson & Johnson, Nestlé, Tesco, Unilever and Walmart.

Click here to download the report.

Source: Capgemini Consulting

The report was released by Capgemini Consulting, the global strategy and transformation consulting arm of the Capgemini Group, together with GS1, the global standards organization, and The Consumer Goods Forum, the consumer goods industry platform.

Since the first barcode was scanned in 1974, standards have led to huge savings for the consumer goods industry allowing more efficient flows of goods and information. As consumers today become empowered through social and mobile technologies, they increasingly require real-time product updates and the ability to scan barcodes to obtain "beyond the label" data such as product origin, ingredients and manufacturing working conditions.

The results of the study showed that there are numerous challenges regarding standards faced by the industry, including:

1. Underuse of standards - Compared to large companies, small and medium-sized enterprises have significantly lower rates of standards use, with manual processing frequently the norm. Standards need to be extended to new channels such as e-commerce and affiliated transportation and logistics parties. 

2. Data available through product barcodes is often missing or inaccurate and not provided in a standardized way across multiple channels.

3. Promotions are problematic as they are necessary for sales growth but difficult to forecast demand as retailers are often unwilling to share promotional strategies.

4. With the challenge of Big Data, retailers and manufacturers find it difficult to respect standards that require barcode numbers to change every time a product is slightly altered.

5. There is increasing scarcity of natural resources but also rising consumer interest in sustainable business -- creating the demand for more accurate and consistent information on carbon footprint, water usage, recycling and energy consumption.

Key recommendations are:

"¢ Develop marketing programs targeted toward companies not making full use of standards

"¢ Introduce simplified standards programs for ease of adoption

"¢ Use existing standards to communicate product information to consumers

"¢ Collect sufficient information about product origin and route to market to minimize risk

"¢ Develop solutions to ensure data quality

"¢ Design new standards to facilitate the exchange of sustainability related data 

"¢ Expand GS1's role from standards defining body to center of excellence in standards deployment

The latest study was based on in-depth interviews with leaders in supply chain and IT functions of 20 global consumer goods manufacturers and retailers worldwide, across Europe, Asia and North America, including Johnson & Johnson, Nestlé, Tesco, Unilever and Walmart.

Click here to download the report.

Source: Capgemini Consulting