Reduce Time-to-Market for Consumer Packaged Goods

By Kristian Kalsing on December 30, 2013

grocery store small

Photo by Sharon & Nikki McCutcheon [CC Attribution 2.0]

If you are a regular grocery shopper, you’ll notice there are often new products on the shelf. Consumer Packaged Goods (CPG) companies are constantly bringing new products to market. One way they are trying to stay ahead of the competition is by reducing the time-to-market. Being first to market with new product innovations provides CPG companies is critical an important competitive edge. New products can be anything from completely new products to existing products customized for certain markets or promotional products where nothing but the packaging has changed. In any case, time-to-market is crucial.

New products can be anything from a completely new product to revamping products customized for particular markets. There are many aspects of introducing a new product, but one step is particularly crucial – uploading the product in SAP. Products in SAP are stored as “Finished Goods” in the Material Master. This complex process includes collecting data for 200-300 different attributes from multiple stakeholders. In most cases this data collection is a very manual process- using spreadsheets and numerous emails to complete. Using a manual process takes up unnecessary time and resources. Many downstream activities, such as production planning and distribution planning, cannot commence until the product has been set up in SAP.

In the last 25 years, CPG companies have significantly outperformed the S&P 500. The industry has been relentless about new-product innovation. In the US grocery channel, for example, the number of SKUs has grown by 50% in just the past seven years. Introduction of new products is clearly a core strategy of CPG companies. This trend will only continue to increase. In fact, a billion new consumers are expected in emerging markets over the next ten years. CPG companies will be pressured to quickly and continuously launch and distribute new products to meet the demands of a growing consumer group. CPG companies will tailor products to these new consumers which again will increase the data management burden.

Data for a new product is collected from many different parts of the business, including accounting groups, the plants that will manufacture the product and the sales organizations that will market the product. Often the data stewards responsible for entering this data into SAP spend a significant amount of time chasing and correcting data from all these different stakeholders. This back and forth can easily delay the process by several weeks and it is not unusual to see the complete data collection and validation for a new product take up to 45 days!

Time to Market

A Winshuttle solution (SAP Material Master) can automate the data collection processes and the data entry into SAP. Electronic forms are routed with workflow to all data owners with automatic reminders and escalations reducing the need for time-consuming follow-ups by data stewards. Data validation at the point of entry eliminates rework and improves data quality by making sure attributes entered by the business are automatically checked against predefined data standards. By reducing time spent on data collection and validation, the overall time-to-market is greatly reduced. With a reduced time-to-market the business will ultimately become more competitive and improve the bottom line.

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