The route to market for consumer packaged goods (CPG) has undergone significant transformations in recent years to adapt to consumer behavior and market dynamics. GHJ recently sat down with Larissa Russell, CEO of distribution company Pod Foods, to better understand these changes. Larissa shed light on the driving forces behind these adaptations and their implications for the industry. 

HOW THINGS ARE CHANGING 

“Traditionally, the route to market was supply-driven, with consumers limited to purchasing products available in retail locations.” Larissa explains. “However, over the past few years there has been a pivotal shift towards a demand-driven model, where consumer preferences for personalization and convenience have become paramount.”  

This shift — fueled by the rise of e-commerce and direct-to-consumer (D2C) channels — has compelled suppliers, distributors and wholesalers to adapt their strategies to cater to individualized consumer demands. 

These forces have, in turn, led to proactive and reactive measures taken by industry players. Larissa emphasizes that “ultimately, it is the consumer who drives the bus, which is prompting businesses to reevaluate their approaches to meet evolving demands effectively.” 

The COVID-19 pandemic served as a catalyst and accelerated trends towards D2C consumption and on-demand delivery. While the pandemic-induced disruptions may have exacerbated existing shifts, Larissa believes that the fundamental changes in consumer behavior are here to stay. She foresees a hybrid model emerging, where online and offline retail coexist to meet diverse consumer preferences. 

NEW ROUTES TO MARKET EMERGE 

In this evolving landscape, innovative companies like Pod Foods are disrupting traditional distribution models. Larissa describes Pod Foods as “a B2B marketplace in the grocery supply chain that offers transparency and efficiency to emerging brands and retailers.” By eliminating intermediaries and providing visibility into fees and pricing, Pod Foods empowers brands to navigate the supply chain more effectively while ensuring fair pricing for consumers. 

Central to Pod Foods' model is transparency, a stark contrast to the opaque fee structures prevalent in traditional distribution channels. By aligning incentives and providing clarity on costs, Pod Foods aims to create a more equitable and efficient ecosystem for brands, retailers and consumers alike. 

The rise of companies like Pod Foods underscores the importance of adaptability and innovation in navigating the evolving route to market in the CPG industry. As consumer preferences continue to evolve, businesses must embrace agility and transparency to thrive in an increasingly competitive landscape. 

Disruption in the route to market for the CPG industry reflects broader shifts in consumer behavior and market dynamics. While challenges persist, innovative solutions offer opportunities for brands and retailers to redefine their strategies and enhance value for consumers in the digital age. 

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To learn more about how GHJ partners with food and beverage CPG businesses to help them achieve their financial goals, please contact GHJ’s Food and Beverage Practice.