1

The Future Value Chain

A Consumer Goods Forum project

Nigel Bagley Global Customer

Development

•Principles:

•Engagement through

workshops

•Not a consultant report

•Ten year view

•Renew every two years

•Objective:

•Bring back a collective

vision to our industry

•Respond to the rapid

changes we saw in

the new century

2

Future Value Chain: Evolution

Follow up on 2016 Future Value Chain

Future consumer

2016 Future Supply Chain

New ways of working together

Information sharing

•Two global workshops

•Follow-up:

- 2016 Future Supply Chain

- Information Sharing report

- New Ways of Working

Together

2016

•Global workshop

•Asian workshops:

- Hong Kong

- Mumbai

- Japan2018

• Global workshop

• Regional workshops

- GS1 in Europe

• Country workshops:

- Netherlands

- France

- Mexico

2020 Building

Strategiesfor theNew

Decade

- US

- Australia

Building Strategies for a New Decade

SCAN FOCUS ACT

Trends Objectives Tactics

IND

US

TR

YL

EV

EL

CO

MP

AN

YL

EV

EL

Industry

Strategic

Objectives

Company

Strategic

Objectives

tren

ds

Global Programs

Regional Programs

Local Programs

1:1 Collaboration

Tactics

Competitive

Tactics

Industry

Collaboration Tactics

3

Key Trends

SCAN

Trends

tren

ds

SCAN

Trends

tren

ds

Increase of

Consumer ServiceDemand

Increase Importance

of Health & Wellness

Increase Impact of

Consumer TechnologyAdoption

Growing Consumer

Concern on

Sustainability

Natural resourcesbecoming scarce

Increase in

regulatorypressure

Shifting of

Economicpower

Rapid adoption of

Supply Chain Technology

Impact of next

generation ICT

Increased

Urbansisation

Aging population

Increased

spread of wealth

Changing Shopper

Changing Environment

Changing Technology

Changing Society

4

Increased Urbanisation• Impact on our industry:

• Challenges the retail model

• Major impact on supply chain logistics

• Consumer Storage

• Access to facilities and utilities

Changing SocietyAging Population

• Impact on our Industry:Impact on our Industry:

•• Pack SizePack Size

•• Store locationStore location

•• Health and WellnessHealth and Wellness

•• Taste BudsTaste Buds

•• Opportunity!Opportunity!

5

Increased Consumer Technology

• Challenges for our Industry:Challenges for our Industry:

•• Marketing to internet and mobile shoppersMarketing to internet and mobile shoppers

•• Focus on priceFocus on price

•• Who owns the consumer?Who owns the consumer?

Rising Cost of Carbon Fuel

6

Building Strategies for a New Decade

Industry

Strategic

Objectives

SCAN FOCUS ACT

Trends Objectives Tactics

IND

US

TR

YL

EV

EL

CO

MP

AN

YL

EV

EL Company

Strategic

Objectives

Global Programs

Regional Programs

Local Programs

1:1 Collaboration

Tactics

Industry

Collaboration Tactics

Competitive

Tactics

tren

ds

FOCUS

Objectives

Global Industry Strategic Objectives

Optimise a Shared Supply Chain

Make our Business More Sustainable

Engage with Technology-Enabled Consumers

Serve the Health & Wellbeing of Consumers

7

SCAN

Trends

IND

US

TR

YL

EV

EL

CO

MP

AN

YL

EV

EL Company

Strategic

Objectives

1:1 Collaboration

Tactics

Competitive

Tactics

tren

ds

Building Strategies for a New Decade

Industry

Strategic

Objectives

FOCUS ACT

Objectives Tactics

Global Programs

Regional Programs

Local Programs

Industry

Collaboration Tactics

FOCUS

Objectives

Global Industry Strategic Objectives

• Relevant Global CGF Industry Projects:

– Sustainability Strategic Pillar

• Global Packaging Project

• Deforestation

• GSCP

– Operational Excellence

• Share our Supply Chain

Make our Business More Sustainable

• Refrigeration

• Glossary

8

Global Industry Strategic Objectives

• Relevant Global CGF Industry Projects:

– Operational Excellence

• Connect Business Information

• Share our Supply Chain

Optimise a Shared Supply Chain

Global Industry Strategic Objectives

• Relevant Global CGF Industry Projects:

– Operational Excellence

• Focus on the Consumer

• Connect Business Information

• eMobile

Engage with Technology-Enabled Consumers

9

Global Industry Strategic Objectives

• Relevant Global CGF Industry Projects:

– Safety & Health

• Principles and Commitments

• Information and Education

Serve the Health & Wellbeing of Consumers

Building Strategies for a New Decade

Industry

Strategic

Objectives

FOCUS ACT

Objectives Tactics

Global Programs

Regional Programs

Local Programs

Industry

Collaboration Tactics

FOCUS

Objectives

10

SCAN

Trends

IND

US

TR

YL

EV

EL

CO

MP

AN

YL

EV

EL

tren

ds

Industry

Strategic

Objectives

Global Programs

Regional Programs

Local Programs

Industry

Collaboration Tactics

Company

Strategic

Objectives

1:1 Collaboration

Tactics

Competitive

Tactics

Building Strategies for a New Decade

FOCUS ACT

Objectives Tactics

FOCUS

Objectives

How Robust is Your Strategy ?

Changing Society

• Are your products solving the health crisis… or creating it ?

• Do you know how the aged will shop and consume in

10 years?

• Do you know where you will get your labor force once

your current labor force retires?

• How will you efficiently serve (underserved) customers

in emerging markets?

• Are your products tailored to urban living?

Changing environment

• Are you able to guarantee sustainable sourcing?

• What are your strategies to address soaring fuel

prices?

• Are you ready for the climate change: do you have

contingency plans for extreme climatic disruptions ?

• Do you have programs in place to address restrictions on truck emissions, access to urban zones, noise pollution?

• Do you have a strategy to work with government ?

Changing Technology

• How do you survive a negative Facebook viral fan page?

• How do you create transparency with consumers while maintaining control?

• Do you know who else is providing information to consumers on your products?

• Is IT really helping to grow and sustain the business ?

Changing Shopper

• How is your company ‘dealing’ with informed expert/ mis-informed shopper?

• Is your company ready to have a meaningful dialogue with millions of individual shoppers ?

• Can your company handle cashless payments?

• Is your company differentiating between a ‘shopper’ and ‘consumer’?

11

Conclusions

• To be ready for 2020 (and 2018 and 2016) we need to increase the collaboration across our industry

• You – the Manufacturers and Retailers in Asia –need to fully support the industry programmesthat are underway in ECR AP and in your country

• Challenge your company – manufacturer, retailer or service provider – on how prepared they are for 2020

• Use the Future Value Chain process to develop a strategy and tactical plan that responds to the external shopper, consumer and society trends

The Future

Value ChainA Consumer Goods Forum project

Nigel Bagley

Global Customer

Development