Expert Interview With ... Fazlur Rahman, Kraft Heinz

We had the pleasure of chatting to Fazlur Rahman, Global Head of Demand Planning & Digital SC Planning Transformation at Kraft Heinz ahead of his appearance as a speaker at CPG Supply Chain Connect 2022, about the best opportunities for supply chains to develop.

How have supply chains changed for consumer goods industry over the past 2 years?

The change is on-going, but I would say we have not seen the change to this degree prior to the 2 years. Consumer goods industry was seeing consumer behavior changes in the past decade, with more shift towards sustainable packaged goods, and with customer segments also being changing towards premium or private label brands. However, in the past 2 years, we started seeing mobility driving changes in the consumer preferences, like bulk sizes of the products being preferred over regular sizes. For the food and beverages, the large impact is on the quick serve ready meals / foodservice business where it is way harder to predict what consumers prefer: bulk items being replenished for the restaurant tables versus the single serve products. The change in consumer behaviors drove supply chains to adjust their production and replenishment mixes. Recent material shortages with changes in vessel availabilities have also disrupted the global supply chains, driving higher cost etc.

As an economist, I can say that there has not been such clear demand / supply correlation translating into the higher cost than before, with all players in the value chain seeing the impact on their bottom-lines.

Where do you think the biggest opportunity to develop reliable supply chains lie?

The biggest opportunity lies in the strategic sourcing. The consumer-packaged goods sourcing were typically secure and were exposed to less risk in the past. The recent shift in all aspects from upstream demand changes driving different signals for the manufacturing to distribution requirements to fulfilling customer orders have caused disruptions to the degree that a typical sourcing strategy does not work. The industry needs to partner with their suppliers more on a sustainable and consistent way, especially when the suppliers have more leverage.

Do you think supply chains will have more prominent role in a short-term to support D2C model in CPG industry?

The supply chains do have more prominent role in the DTC model in a short-term, given it is even harder to execute it in the current environment. However, I do see it as an incremental opportunity for the consumer-oriented businesses, where manufacturer to retailer to consumer supply chains have a gap. That gap can be used as an opportunity for the manufacturers specially in the consumer packaged businesses to deliver directly to the consumers, if they have formed good partnerships with the last mile logistics providers and even the marketplaces to provide better visibility to the consumers on their orders. For DTC model to operate, the CPG industry needs to improve on giving visibility to the consumers.

Tell us about your involvement in CPG Supply Chain Connect this year

I will be involved in two sessions at the CPG Supply Chain Connect this year. I will be doing an interview on how to leverage data analytics to better respond to the disruptive events, and also will have a fireside chat with other industry peers on the top 5 innovations where investments should be made for the data-driven resilient supply chain.

I think the agenda and the conference speaker profiles for this event is incredible, and this event is much needed to continuously evolve the supply chain industry and share the learnings. The supply chains have not been this critical for the world economic growth than ever before.