A Human Powered Industry Delivers on its Responsibility
A few months back, I read a story about Gabe Scuderi, an employee in RB’s Lysol manufacturing facility in New Jersey. His daughter had been watching the news as coronavirus escalated and told him he was saving the world right now. In that moment, his job became a purpose.
And then there’s Carolyn Mendel, a 15-year veteran of General Mills who oversees 1,000 workers in Wellston, OH where they make Totino’s pizza and rolls. She said her facility has adopted “pizza to the people” as an unofficial motto and takes pride in the fact that they are serving their country by coming to work every day.
Stories like these echo across the industry, bearing the same hallmark — the pride of our responsibility to consumers. Consumer packaged goods (CPG) — food, beverage, personal care and household cleaning items — are essential to every American home. That was true before the pandemic, but it has taken on a heightened importance since COVID-19 struck.
The industry has done everything in its power to meet skyrocketing demand because it must. Americans can’t stay home and stay safe without our products.
The industry has done everything in its power to meet skyrocketing demand because it must. Americans can’t stay home and stay safe without our products. And while the average consumer may not think about the people behind the boxes on the shelves as they roll their cart by, this is a human powered industry that has worked tirelessly behind-the-scenes to deliver.
There will be no rest. While the panic buying of March was unprecedented, May purchases were up 4.1 percent over April, proving that the heightened need for CPG products was not a moment, but will be with us for a very long time.
Our companies realize that they must sprint a marathon. Overall, the industry is up 9.9 percent year-over-year. But high-demand items show even more aggressive growth. Flour, for example, has been one of the hottest commodities of the pandemic, pushing sales an incredible 233 percent higher in March than they were a year earlier.
Frozen food offerings, produced by CPG companies like Conagra Brands, have emerged as some of the most sought-after during this pandemic. Conagra reported a 25.8 percent increase in net sales in the last quarter. It is working hard to build up its inventory, something CEO Sean Connolly said would be difficult to do — particularly for brands that are flying off the shelves like Chef Boyardee and Healthy Choice — unless demand slows.
Our companies realize that they must sprint a marathon. Overall, the industry is up 9.9 percent year-over-year. But high-demand items show even more aggressive growth.
But demand is unlikely to slow, particularly as cases surge and a fall or winter second wave is still a distinct possibility. Companies are racing to respond. McCormick has added the equivalent of another factory, increasing production at its own plants and leveraging third-party manufacturers to grow inventory. General Mills has started delivering some of its most in-demand lines like Annie’s, Cheerios and Gold Medal Flour directly to retailer warehouses, cutting out a step in the supply chain. Long-honed algorithms are being pushed aside in favor of real-time decision-making and human judgment.
The relentless pace that CPG companies are keeping is set against the difficult backdrop of a broader economy that is suffering and has a very long road ahead. While June employment numbers were better than expected with the addition of 7.5 million jobs, recouping the 22 million jobs lost in March and April will be challenging. As a result, many Americans are getting by on stimulus checks. Those checks are going toward CPG necessities: 80 percent of recipients said they were using funds to buy food and another 58 percent said they put it toward household or personal care items.
Whether you’re unemployed, underemployed or fully employed, pervasive uncertainty is something felt by all Americans right now. In the inaugural CPG Speaks session, General Mills CEO Jeff Harmening said, “In a world where so much is changing, people yearn for something they can count on, and for us, it’s our brands they know and trust.”
It is our aim to be an industry people can count on. And we are proud to be delivering on that responsibility, every day.
Published on July 21, 2020
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