Are CPG brands headed for a very merry Christmas?
Boosted by homebound living and the return of panic purchases, consumer packaged goods (CPG) purchases are expected to climb between 9.5 to 11.5 percent for the holiday selling season (November/December), according to the Consumer Brands Association.
The anticipated growth drivers are expected to be a continuation of stay-at-home trends — whether as a precaution or by order — that have pushed year-over-year CPG sales up more than 10 percent in three of the last four months. Holiday purchases, which resulted in a three percent rise for CPG last year, are expected to provide a boost again this year.
A Consumer Brands/Ipsos poll conducted as part of the forecast found that more than two-thirds (68 percent) of Americans plan to stay local — at their own home or going to the home of nearby family or friends — for Thanksgiving and 75 percent for the winter holidays.
Other pandemic-driven factors are expected to include the return of stockpiling and the strong digital shift in the CPG space.
According to a survey from Inmar Intelligence conducted during the week of October 14, 57 percent of shoppers plan to stock up again as winter approaches. Grocery chains including Kroger and Giant have begun reinstating purchase limits on items such as toilet paper, paper towels and disinfecting wipes.
The Consumer Brands Association survey showed that 46 percent of consumers are at least a little worried about access to food and beverage products, with 57 percent saying the same about household cleaning products. Fifty-eight percent said they’re at least a little worried about what the increase in online shopping will mean for getting CPG essentials.
A RetailWire visit Sunday to Costco’s warehouse club in East Hanover, NJ, showed disinfectant spray and wipes, face shields, Bounty paper towels, disposable gloves, Lysol Multi-Surface Cleaner, rubbing alcohol and Clorox Clean-Up and Windex all out of stock.
“For CPG, it has been the equivalent of peak season since the pandemic started,” said Tom Madrecki, vice president of supply chain at Consumer Brands. “It raises the importance of addressing systemic challenges like the truck driver shortage, infrastructure needs, freight rail performance and port clearance times. Improving supply chain efficiencies will only happen with concerted policymaking and strong leadership across government.”
- Holiday Forecast Estimates CPG Purchases Will Rise 9.5-11.5 percent – Consumer Brands Association
- Some Grocers Bring Back Purchase Limits as Covid-19 Cases Rise – The Wall Street Journal
- New Inmar Intelligence Survey Reveals Over Half of Shoppers Are Considering Replenishing A Current Stockpile of Products As Winter Approaches – Inmar Intelligence
- Walmart will start counting customers again as coronavirus cases reach record levels – CNN
- Some grocery stores are limiting toilet paper and disinfecting wipe purchases again – CNN
- Will a new round of panic buying empty grocery store shelves? – RetailWire
DISCUSSION QUESTIONS: What’s the likelihood that sales of CPG categories will continue to grow at elevated levels in the months ahead? How might the challenges for retailers supporting essential categories be the same and different compared to the early days of the pandemic?