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What Are Consumer Packaged Goods (CPG)?

Consumer Packaged Goods (CPG) are products that consumers use up and replace on a frequent basis.

Characterized by their short shelf life, these goods are typically sold at a low cost and include items such as food and beverages, toiletries, over-the-counter drugs, cleaning products, and other consumables. The CPG industry is one of the largest sectors globally, driven by high-volume sales and market demand.

CPG products stand out for their necessity in daily consumer lives, leading to regular and repeated purchases. This constant demand ensures a steady stream of revenue for companies operating within this sector, though it also means these companies often operate on thin margins due to the competitive nature of the market and the low cost of individual products.

Innovation, branding, and distribution efficiency are critical success factors for CPG companies. They must continually engage consumers with new and improved products, compelling marketing strategies, and effective supply chain management to ensure product availability across various retail channels.

The rise of digital technology and eCommerce has significantly impacted the CPG sector, shifting the focus towards direct-to-consumer (DTC) channels and online retail, which offer new avenues for growth, customer engagement, and personalization. Moreover, sustainability and ethical sourcing have become increasingly important to consumers, influencing CPG companies to adapt their practices and product offerings to meet these evolving preferences.

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