The products that you usually buy customers do not always come from the same place, which influences many variables, to understand it in this post we will show you the difference between retail and CPG.
Have you heard of CPG? Probably not, but certainly if you know the meaning of the word retail, however, in this article you will understand the importance of both and the difference between retail and CPG.
Basic concepts Retail
In the context of these two important industries, the trade retail refers to the sale of products to their end users. The easiest way to understand the retail trade is through retail, the traditional e-commerce, or even more channels obsolete, such as; catalogs and orders by phone.
Consumer goods packaged (CPG)
Their acronym comes from the term in English Consumer packaged goods (CPG) and refers to a wide spectrum of manufacturers, marketers and traders of physical goods, usually packaged in some way, used by consumers and sold through a retailer.
CPG it is a larger space that engages businesses located in a step before in the string supply involved in the development, production, marketing and sale of products destined for the consumption of end-users.
In general, CPG it is involved in the wholesale level, so that the companies in this industry manufacture the products that are sold to the retailers, and they are found on the shelves of the stores.
Many times, companies CPG also have an element of retail. For example, major fashion brands that are technically companies that are classified within the category of the CPG, because if your main business is to create and sell their garments to retailers, high level, they also have retail stores own intended exclusively for your brand.
CPG in the digital age
The CPG have been sold traditionally in physical stores, but the technology boom has generated changes, making these products are sold well in the sector e-commerce.
Consumers can order and pay for their purchases of CGP using the model by clicking and collecting, where they can receive a message on your smartphone that tells you that your order is ready to be picked up or delivered.
Allowing the CPG to go a step further of the supply chain and increasing the interaction with the final consumer.
Main differences between Retail and CPG
As you can see, the lines between these two industries often can be crossed, so here are some more simple difference between retail and CPG.
To not complicate things too much, we can say that companies CPG are those that manufacture, market and sell products to companies in the retail sector.
By its multiplicity of functions to find differences between retail and cpg can be confusing, hence the importance of responding to the concerns that arise when trying to understand who they are.
For example, there arise questions like:
How can a company of CPG also be a retailer?
The answer is a resounding: yes, you can, as some have their own stores for the sale of its original production.
How can a retailer also be a company of CPG?
The answer is also affirmative: yes, you can. For example, in the united States, industry giants such as Walmart and Amazon sometimes manufactured, marketed and sold their own brands.
Given this scenario of possibilities of crossing the line that is supposed to mark the difference between retail and CPG Does that mean that we can refer to CPG and retail interchangeably?.
The answer is no, as these terms should never be confused due to its nature depends on who your customer is. Companies of CPG sell to retailers who in turn sell to consumers.
In the sector CPG are mainly located companies of consumable products, detergents and toiletries.
Conclusion
The difference between retail and CPG it is mostly in the recipient of the products, as it usually stores only buys manufacturers their production, and these put them on show and market it by applying the different sales strategies industry of retail.
However, both sectors can make use of the functions of the other, because in some cases the retailer also manufactures and sells, fulfilling all the roles of the chain, which can also occur on the side of the CPG that you can create forms for direct sale to the customer that traditionally gone to the retail store.
