As the next geopolitical crisis impacting the European economy unfolds, Europe doesn’t just worry about energy or semiconductors—it worries about what people rely on every day: the milk and eggs in the fridge, the pasta and coffee in the cupboard, the shampoo in the bathroom, and the detergent that keeps workwear and school uniforms clean. For Europe’s fast-moving consumer goods (FMCG) manufacturers, disruption has been a near-constant since the beginning of this decade, with Covid driving hard lessons in supply diversification, contingency planning and agility. The question is no longer whether disruption will happen, but how it is managed to keep trusted brands available, affordable and sustainable—on every shelf, in every Member State.
What the industry delivers for 450 million consumers
Fast-moving consumer goods (FMCG)1 manufacturers operate a broad industrial footprint with production sites across the EU—from the west of Ireland to the east of Romania, from the north of Sweden to the south of Spain. As the EU’s third-largest manufacturing sector, comprising around 300,000 companies and supporting millions of direct and indirect jobs across Member States, it is managed and designed to ensure efficiency, security of supply and responsiveness to local market conditions. The sector provides an anchor to regional economies: a detergent plant, a dairy facility or a tissue mill supports local jobs, skills and SMEs up and down the value chain (from transport to maintenance to packaging suppliers).
The purpose of the FMCG industry is simple: make sure people can buy safe, compliant, high-quality brands they trust—every day, at scale. That includes the shampoo that helps manage frizzy hair, the detergent that removes grass stains from a child’s sports kit, the toothpaste in the morning routine, the tissues and hygiene products people take for granted, and the favourite chocolate biscuit that ends up in countless shopping baskets.
But brands must also keep evolving to compete and deliver to consumer expectations: more protein and less sugar in foods, alcohol-free alternatives, concentrated formats that use less water, packaging redesigned for recyclability, and factories shifting to renewable electricity, biogas, hydrogen or electrified heat where feasible. This innovation is the focus of major investment, totalling EUR 99 billion2 a year supporting R&D, new production lines, digital logistics and energy upgrades that keep European manufacturing productive and cleaner.
A cornerstone of the Single Market and of daily life
The Single Market is crucial to this industry, one of Europe’s most tangible strategic assets: it turns agricultural inputs, chemicals, packaging and logistics into the everyday goods households buy weekly—bread and biscuits, milk and beer, toothpaste and deodorant, nappies and tissues, pet food and household cleaners. It is a cross-border success story. Ingredients, packaging and finished products move constantly across the EU to balance local demand and keep costs under control. Every year, approximately €276 billion of everyday consumer goods are made and moved across the Single Market3, out of a total consumer goods market of €1.4 trillion, the rest being made and moved within member countries.
Therefore, this is an industry that depends on the Single Market working well, and it is not in its interest to “constrain” it. FMCG supply management operations are present in every EU territory, with companies managing complex cross-border flows as efficiently and responsibly as possible to serve all customers and consumers everywhere. That is why it is striking that FMCG is the only industry explicitly referenced in the EU’s recent Single Market Strategy “Terrible Ten” list of barriers, through the issue of “territorial supply constraints” (TSCs), even though the sector delivers, every day, to support citizens across the Union, and TSCs are already governed by competition law.
Managing businesses for growth and competitiveness
With a new geopolitical crisis already creating challenging economic headwinds, if Europe wants to be resilient, supply management operations become even more critical. FMCG is not a niche sector: it is the everyday interface between Europe’s industrial base and its citizens. Supporting it means protecting the ability and freedom to manufacture and distribute goods by the most effective and efficient means possible, particularly in supply management operations. Any new legislation or measures affecting this freedom must undergo thorough evidence-based economic and impact assessments across the supply chain, and consider all factors, including competitive market dynamics. The evidence base must be strong to restructure supply chain operations, particularly to ensure that such changes will not lead to increased consumer prices.
With an ambitious competitiveness agenda Europe must be attractive for investment in factories, brands and jobs. This requires consistent regulations and a fully functioning Single Market: fewer national differences that drive up costs should be a focus and a commitment of each government in the EU and should be addressed as a priority to truly enable One Market.
Fairness is fundamental to this competitiveness. European manufacturers invest in meeting high EU standards for product safety, labelling, high-quality ingredients, consumer information and environmental compliance. As the industry relies heavily on reaching consumers via business partners, those partners also have a responsibility to uphold fairness, ensuring choice for consumers on the shelf and a strong and diverse supply chain, which will ensure a resilient consumer goods ecosystem for all.
In short, the FMCG industry is not only about what is in the shopping basket; it is about the strength of Europe’s manufacturing base, the smooth functioning of the Single Market and the credibility of EU standards. Supporting the consumer goods industry —through smart regulation, investment-friendly industrial policy and robust enforcement—helps ensure that Europe remains resilient in disruption and competitive in a world of intensifying global pressure.
Click here to read the Euractiv Op-ed.
References:
[1] Packaged Food, Pet Care, Health & Beauty, Household Cleaning Products, Paper Tissue & Hygiene, (Non) alcoholic Drinks
[2] BERD and gross investment in tangible non-current assets for R&D and SBS gross detailed NACE rev. 2 activity 2022
[3] Euromonitor, 2022, based on Eurostat using HS codes, Trade by commodity.
