In conversation with Shonik Goyal, Head Distribution & International Supply Chain, Bajaj Consumer Care
The FMCG segment in 2020 turned the crisis into an opportunity by learning and unlearning what is it that truly drives the market. With food & personal care items leading the demand for the segment, it has been clocking growth and has been looking forward to carrying the same momentum while aligning itself to the new normal. In this exclusive interview, Shonik Goyal, Head Distribution & International Supply Chain, Bajaj Consumer Care gives us a glimpse of how the pandemic redefined the FMCG supply chain, the importance of collaboration and technology in such times, the importance of agility, the critical role of packaging in determining supply chain performance and much more.
How has the pandemic-driven demand changed the supply chain strategies for the FMCG sector?
The pandemic has increased uncertainty to a level never seen before in supply chains. Demand patterns are all over the place, supply lines are disrupted, lead times are uncertain, and nobody is quite sure when and how things will change going forward. Supply Chain Planning is more like Supply Chain Prognosticating. Online commerce has exploded, and the consumer won’t change once the pandemic subsides. That’s putting huge pressure on last-mile delivery. Secondly, demand has become more erratic as consumer buying pattern has undergone a lot of changes due to pandemic as consumers are shifting to larger packs so that consumer does not have to visit the marketplace repeatedly.
Moreover, consumer has become choosy in terms of buying value products i.e. value has become bigger virtue than cost. For truck drivers, COVID also has shined a bright and deserving spotlight as their role is essential to the economy for keeping store shelves filled. We are seeing more acts of kindness shown to our drivers, and more appreciation for the work they do every day.
The logistics industry including the FMCG sector has been big on collaboration and technology ever since the breakout of the COVID-19 pandemic. Tell us how collaboration and technology have been the life-jacket that helped the sector stay afloat during the pandemic?
First and foremost was the ‘people connect’. Post the lockdown announcement, at the time of pandemic onset in March 2020, it was important to remain connected with the functional team, logistics service providers, and the last mile delivery person. It was important to communicate effectively and reduce the panic.
Secondly, it was important to collaborate and explore options of reopening the warehousing and depot network. Also, real-time data was critical with respect to in-transit stocks and depot and distributor inventories as plants were not producing the products due to complete lockdown and zero labour availability. For us, we constantly communicated and collaborated with all internal as well as external stakeholders.
We kept a close watch on the communications from the Ministry of Home Affairs (MHA).
We constantly checked the status with the local administration, and we kept the team motivated. We utilised technology through SAP and communicated on the stock coverage to all stakeholders. We leveraged and utilised Whatsapp groups to stay connected and ensure proper information flow through the entire logistics chain including the drivers who were stranded midway without food and shelter. We even maintained constant contact with our distributors and customers to give them the comfort that we care about and we are in this together.
Certainly, collaboration and technology was a life jacket for us and it ensured that we remain connected and come back stronger and united.
What are the top challenges faced by companies during inbound logistics for choosing the procurement sources?
Lead time and long distance is the biggest challenge. Post the pandemic, supply chains are focussing more on localisation of procurement sources because long distances and long lead times might not be workable if the lockdowns keep happening off and on.
Assurance of supply and vehicle availability is another challenge nowadays post-pandemic. Freight cost is another challenge given the fact that diesel rates are increasing very quickly and per kilometre cost is rising steeply.
This is an abridged version of the interview was originally published in the April Issue of the Logistics Insider Magazine. To read the complete interview, click here.