A new report provides the consumer goods sector with proven, tangible solutions to reduce the nearly $15 billion annual cost of unsaleable goods, or products that cannot be sold due to their condition.
The Collaborative Strategies to Reduce Unsaleables report was released at the Council of Supply Chain Management Professionals (CSCMP) annual conference. The report ranks solutions with a track record of success and provides implementation guidance. The report was completed by CHEP for the Trading Partner Alliance (TPA), an industry affairs leadership group formed by the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA).
“Reducing unsaleable goods is a priority for retailers, manufacturers and their suppliers,” said Daniel Triot, senior director at TPA. “This report effectively documents the causes of unsaleable goods and provides trading partners with clear instruction for reducing them and the impact they have on efficiency, sustainability and profitability.”
The recommendations are based on an extensive, year-long analysis predicated on dozens of interviews with industry experts conducted by CHEP for the TPA Joint Industry Unsaleables Leadership Team (JIULT). The study captured and analyzed 48 unsaleable goods reduction strategies and placed them into seven categories based on frequency of use and impact:
1. Planning and Review
2. Collaborative Shelf Life Management
3. Testing Package and Unit Load Performance
4. Package Labeling
5. Receiving and Warehousing
6. Sharing UPC and POS Level Data
7. Product Rotation and Display
Recommendations in the report fall into four categories – increase, continue, monitor or ignore – and each is identified as the responsibility of retailers or manufacturers, or as a collaborative opportunity.
A TPA online Unsaleables Reduction educational platform is expected to launch by the end of 2017. The educational platform will contain detailed information and tools to help trading partners review their supply chains and identify and implement effective unsaleables reduction strategies and solutions.
The Trading Partner Alliance (TPA) is a joint industry affairs-industry relations leadership group formed by the Grocery Manufacturers Association (GMA) and the Food Marketing Institute (FMI) to develop and address a shared retailer-manufacturer agenda on supply chain efficiency issues, the application of information technology, executed jointly by GMA and FMI and overseen by the boards of directors of both organizations.