Consumer packed goods is a tough business. Almost every single consumer product category features entrenched players who have brands backed by literally hundreds of millions of dollars. Not only do companies need to create products that consumers want, but they must fend off competitors who are using their hundred-million-dollar war chests to entice customers (retailers)… Continue reading
G.E. was the definition of a conglomerate–and now it’s not. Learn what the corporate structure is, its’ strengths and weaknesses through a G.E. case study.
Large CPG firms have weathered the coronavirus storm fairly well, but what will happen to small CPG companies?
Just one week after March 15, 2020, when President Donald Trump claimed the US had ‘tremendous control’ of the coronavirus pandemic, California Governor Gavin Newsome ordered all state residents to stay home. “The order,” the New York Times reported, “represents the most drastic measure any governor has taken to control the virus.” Similar orders may become… Continue reading
What exactly is a consumer packaged goods (CPG) company? I answer that question and outline their two main business strategies.
Last week the Campbell Soup Company announced that its recent investment in soup marketing paid off. This news is somewhat surprising. Nearly all research shows that consumers want fresh food. According to IRI, in 2017, fresh sales accounted for approximately 30.5 percent of all food sales, with produce, bakery, and deli meats accounting for most… Continue reading
How the private equity model drove one of the world’s largest food and beverage companies into a corner.
In theory, the relationship between CPG manufacturers and retailers is one of mutual interest and cooperation. A retailer needs healthy manufacturers to stock their stores with quality products that consumers want. One of the subtexts to my earlier article on Dean Foods is that retailer consolidation is weakening the power of manufacturers to the point… Continue reading
Negative externalities are an economics concept that is not often talked about, but incredibly intuitive. A negative externality is when an interaction between two parties harms a third party. If I buy new speakers from Sonos, Sonos gets money, and I get speakers. If I play them at all hours of the night, my neighbor… Continue reading
Unilever, the world’s largest tea producer, is looking to get out of the tea business. From Reuters: The company said the review was triggered by the sales slowdown of traditional black tea in developed markets as consumers shift towards herbal tea. Black tea is the dominant part of Unilever’s tea business, Pitkethly said, selling in… Continue reading