Big-name consumer brands like Coca-Cola and Unilever are investing in logistics-focused startups, as pressure from a growing e-commerce sector forces CPG firms to improve delivery capabilities.
CPG brands are grappling with a rapidly-changing retail landscape where e-commerce is growing and same-day delivery is becoming the norm — and they may not be ready to adapt.
While CPG companies are already under pressure to find new distribution channels as traditional retailers increasingly push out their own private labels, they face obstacles on the logistics front.
E-Commerce will be responsible for half of all grocery retail sales growth in North America over the next two years — however, only 6% of CPG brands have a dedicated e-commerce/supply-chain team.
Moreover, retailers have been demanding stricter on-time delivery requirements for CPG brands, who typically bear 60% of logistics costs.
Subsequently, CPG brands from Coca-Cola to Unilever are investing directly in logistics-related startups to grow and modernize their delivery capabilities.