Mish's Global Economic Trend Analysis Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Mish's Global Economic Trend Analysis

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: John McCarthy who wrote (93024)	1/19/2009 8:39:20 AM
From: ajtj99	5 Recommendations Read Replies (4) of 116555

I'm seeing lots of major grocery and consumer staple brand names holding their price increases from 2008 and even increasing more in some cases. It may take until mid 2009 until these companies get realistic as consumers substitute down out of their products. Right now the only folks that seem to be getting aggressive are PG's Crest division. Consumer chemicals like detergents and cleaners are still out of touch with current reality in which their chemical input costs have been slashed by 50-80% yet they still hold on to the 2008 price increases. Many staples are priced as if freight was at mid 2008 costs instead of 2009 costs, making them 10% too high in many instances on that aspect alone. Kleenex went out and made their tissues thinner and lowered the price about 10%. That's the first time I've seen their quality drop. Northern toilet tissue stripped a ply out of their regular product and dropped the price about 10% and introduced a "premium" 3-ply tissue that's more like what their old product was like. The new product is almost double the price of the normal product. That's not going to hold. I am seeing many more people buying store brand toilet paper, tissues, and paper towels than ever. Much of it is being made by the major brands and in some cases is identical. People are figuring this out. Store brand sodas have also been selling like crazy as Pepsi and Coke instituted large price increases last year due to the higher costs of sugar and freight. Once that happened, there was a huge surge of demand that switched to the store brand 2-liter sodas. Pepsi and Coke are now starting to respond with promotions to counter that. Store brand cereals are also selling quite well now. Folks on a budget are finding out the taste and quality are not that different than the name brands. In grocery stores I have been seeing some of the most savvy buying I've ever witnessed. The typical household shopper is really watching their budget and shopping like I haven't seen since the 1979-1982 recession, when those plain generic products were introduced at the grocery store.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next