A consumer-packaged goods giant is harnessing AI to produce more toothpaste and dog food in less time

• Colgate-Palmolive uses sensors and robotics to speed up quality checks with less human intervention.
• These tools allow the company to optimize manufacturing at its 49 plants.

Colgate-Palmolive produces more than 15,000 tubes of toothpaste a minute.

To ensure the manufacturing line was running properly, an employee would perform quality checks every 30 minutes to make sure that the Colgate toothpaste tube was aligned properly, its seal was sturdy, its artwork was printed properly, and the box's case matched the tube.

But with new technology investments, sensors, and other digital tools, the company can now conduct quality checks continuously. Similarly, the consumer products giant is rolling out analytical testing for Hill's pet food, using robotics to ensure the quality of the food matches the desired formulation.

With less human intervention, "people can really focus on the operation of the lines," Luciano Sieber, Colgate-Palmolive's chief supply-chain officer, told Business Insider.

How COVID changed supply chains for consumer-products giants

Colgate-Palmolive produces Irish Spring soap, Speed Stick deodorant, and Ajax cleaning supplies at 49 plants, and its goods in categories ranging from home to personal care are stocked at nearly 200 warehouses globally. Colgate-branded products are found in almost 60% of households worldwide.

Like other consumer-packaged goods giants, Colgate-Palmolive's supply chain was built on a fairly steady business model. Large volumes of goods are made at its plants, then shipped to warehouses that distribute them to large retailers.

However, the supply chain is more complex now because consumer shopping patterns have changed. COVID led to a spike in demand at e-commerce stores that sell household goods, even those that were still available at physical stores. Food and personal-care products saw the greatest revenue growth in transitioning to online channels, according to the Commerce Department's International Trade Administration.

That migration of spending has stuck, even after the pandemic waned, putting greater pressure on consumer brands to ensure their supply chains are as efficient as possible. CPG brands aren't just shipping to large accounts like Walmart and Target. Food and household goods are now coming from a lot more locations to reach shoppers.

Automation and AI allow for more efficient manufacturing

Automating Colgate-Palmolive's manufacturing lines helps smooth out location-related variables, the company said.

In Europe, where product formulas can vary by region, a plant might have hundreds of combinations of packs and formulas, and there are thousands of vendor partners for Colgate's toothpaste, tubes, and containers.

With artificial intelligence, the plants can use algorithms to optimize the manufacturing plan for all the different toothpastes the company produces.

"It supports our growth, but also it minimizes the amount of capital expenditure we need to invest in more capacity because we can optimize what we already have," Sieber said.

Emma Rolfe, Colgate-Palmolive's senior vice president of global supply, demand, and e-commerce, said that leveraging AI helps the company more effectively adjust for changes to the workflow when a new formula is added or capacity requirements change when demand increases locally.

"That is something that today takes many hours, and you get many different answers depending on who you are," Rolfe said. "AI can help in a more standardized way."

New AI tools help track and trace goods

Colgate-Palmolive is piloting digital AI tools, including track-and-trace technology, that can give retailers automatic updates to their product orders, including any delays that might occur during shipping.

Sales representatives can use a phone to scan a shelf in a store, leverage AI to look for gaps, and determine which items need to be restocked to meet the demand of that store's customer base.

Last year, the company opened a new Hill's pet-food factory in Kansas, a 365,000-square-foot facility that's Colgate-Palmolive's first "smart" factory, which relies on AI and automation and fewer people. It's allowed the company to shorten its production cycle, create flexibility to innovate new pet-food products, and decrease energy and water use compared to other plants, a press release from the company said.

"Every single operation, like quality testing, has been automated and that enables for a much more efficient factory," Sieber said.

As is often the case with AI and automation, new factories like the one in Kansas raise questions about their impact on jobs. But Sieber stresses that humans will always participate in manufacturing.

"What we find in our most advanced sites is technologies alone, they don't solve everything," Sieber said. Upskilling Colgate-Palmolive's workforce, he said, moves people "away from doing manual work to really using the power of critical thinking and conceptual thinking to improve process performance."