US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

Latest Retail Sales Report Shows Effect of Product Shortages on Building Materials Retailers

The latest retail sales report showed that for many industries, solid sales gains were the order of the day. However, for building material and garden supply retailers, the picture was mixed – while sales remained high, on a monthly basis, June retail sales posted a slight decline from the level seen in May.

This ongoing strength in sales – as noticed earlier – has been driven in large part by the DIY consumer, as homeowners suddenly found themselves with plenty of time to complete home improvement projects, such as installing or repairing decks and fences, installing flooring, or reconfiguring rooms into home offices and gyms. But, this surge in buying activity has caused an unintended effect – a shortage of the pressure-treated lumber often used in these projects as lumber mills have yet to boost production to meet demand.

This shortage of lumber – and the various building materials crafted from pressure-treated lumber – has affected retail sales, and will continue to do so going forwards as construction professionals ramp up their own activities in anticipation of the busy summer season. Some DIY homeowners – frustrated by delays in obtaining lumber or its high cost – will move on to other projects, while others will reduce the size and scope of projects until materials are available at the desired price. Until lumber mills can increase pressure-treated lumber suppliers, this shortage of lumber may continue to be a drag on building material suppliers’ sales.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia also offers an expanding catalog of COVID-19 Economic Impact reports, which highlight how various industries are responding to the current crisis with a comparison to recent recessions. Freedonia Custom Research is also available for questions requiring tailored market intelligence.


Shortages of Closures With Pump Dispensers & Spray Triggers Leading to Innovations & Conservation

With hand soap and sanitizers among the industries seeing strong sales during this pandemic, more companies have jumped into the industry including distillers and perfume manufacturers. As a result, packaging suppliers are seeing the limits of global manufacturing capacity of pump dispensers. Spray triggers are also in shortage as sales of sanitizers meant for application on equipment and across larger areas (e.g., grocery carts, work stations, public restrooms) skyrocket as well

Not only are these dispenser largely made in China, but they are also complex to produce, making it difficult for other packaging firms to jump into this market to capitalize on the opportunity.

However, this is an opportunity for the packaging industry to innovate and shift consumer behavior. Soap and sanitizing suppliers are offering their products with flip-top caps or screw caps, instead of waiting for pumps, to be sure that they can keep their products available to the public without interruption. Others are selling their soap or other cleaning supplies in larger pouches or bottles that are intended to refill smaller containers.

Consumers are being encouraged to save their empty containers that already have pumps and simply refill them from the new packages, or, if it fits, move the pump or spray dispenser to the new container. Since pumps and spray triggers are often difficult to recycle, this is an opportunity to limit waste in packaging. While we are seeing a shift toward hygiene concerns keeping many consumers from reusable food containers and reusable shopping bags, this is an opportunity to “green” the packaging within a consumers’ own home.

The alternative solution is hand soap and hand sanitizer customers to switch to touch-free dispensers and other such products that are designed to be refilled. Such products do not require conventional plastic pump cap dispensers of any kind.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research on the packaging industry. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Packaging    

PepsiCo’s Earnings Results & What That Says About Food & Beverage Trends

PepsiCo announced second quarter 2020 earnings results on July 13. Here are a few notes about key trends in PepsiCo’s sales and what that means more broadly.

  • Snacks, esp Cheetos, are up...consumers want comfort foods and with a lot of people -- particularly children -- eating at home, snacks are big
  • Juices are up...consumers are looking for products with a health-halo, particularly if it boost the immune system
  • Oats are up...not only are more consumers baking at home, but more are also eating breakfast at home and are looking for comforting and healthy foods
  • Beverages, in general, are down...although beverage sales are up in grocery and dollar stores channels, the category is down overall because of weak business at convenience stores (that’s a grab-and-go business, but people aren’t out and about as much) and the closures or limited operations of restaurants, movie theaters, & sports stadiums
  • Pepsi Zero Sugar and Bubly are up...consumers are looking for beverages with less sugar, as products that have more of a health halo compared to high-sugar options

Going forward, how can food and beverage companies continue to succeed and grow?

  • Develop products – snacks, meal replacement bars, beverages, etc -- that focus on immunity. Probiotics, prebiotics, and antioxidant vitamins are immune system-boosting cues to consumers.
  • Consider their new products that group popular snack brands and comfort foods. PepsiCo’s pipeline includes Cheetos mac and cheese – a combination of a popular snack brand and a beloved comfort food
  • E-Commerce – it’s here to stay as contact-free ordering and home delivery are habits that are becoming sticky among consumers. PepsiCo developed their own e-commerce platforms to sell their food products directly; expect other big food companies to follow.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research in the packaging industry, including new reports on Global E-Commerce Packaging and Global Foodservice Single-Use Products. Additional information is also available in food and beverage reports available from The Freedonia Group’s sister publisher Packaged Facts, including Food Carryout & Delivery, Food Carryout & Delivery: Special COVID-19 Consumer Insights, Food Market Outlook 2020: Home Cooking & Grocery Shopping in the Age of Coronavirus and Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era. Freedonia Custom Research is also available for questions requiring tailored market intelligence

  Covid-19      Food & Beverage    

COVID-19 Pandemic to Affect Bathroom Design

Concerns about health and safety have never been higher, as interest in reducing the risk of transmitting the coronavirus is spurring numerous changes in nearly every facet of daily life. Bathrooms have not been immune to this, as heightened concerns about cleanliness have encouraged designers, construction professionals, and building managers to look at ways to make bathrooms safer and cleaner.

A recent article indicates some of the ways in which this transformation is occurring – which will have important considerations for the building construction industry. Changes in bathroom design practices will affect demand for a wide range of building materials, such as:

  • rising use of touchless fixtures, such as faucets and toilets, to minimize contact
  • increasing installation of paper towel dispensers as hot air dryers are removed from bathrooms
  • adding sink and toilet fixtures to try to keep large crowds out of bathrooms
  • specifiers choosing countertops and vanity tops made from solid surfacing, synthetic stone veneers, and other nonporous materials that inhibit the growth of viruses or bacteria
  • installing partitions to direct crowd flows to promote social distancing

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia also offers an expanding catalog of COVID-19 Economic Impact reports, which highlight how various industries are responding to the current crisis with a comparison to recent recessions. Freedonia Custom Research is also available for questions requiring tailored market intelligence.


US Faces Another PPE Shortage As New COVID Cases Surge

A national nurses union is warning that front line healthcare workers in the US are facing another PPE shortage as the number of new COVID-19 cases continues to soar nationwide and new transmission hotspots emerge in states like Arizona, Florida, and Texas, which were among the first to lift government restrictions on business activities throughout the state.  

Suppliers of critical medical products such as disposable masks, respirators, gowns, and hair covers have significantly ramped up production and restructured supply chains to make up for the PPE shortfalls seen at the pandemic’s onset. While these efforts will mitigate new supply shortages to an extent, further capacity expansions will be necessary to meet the resurging, and still growing, increase in demand. 

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, including Global Disposable Masks & Respirators, Global Disposable Medical Gloves, Global Medical Face Shields, and Global Disposable Medical Supplies. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Healthcare & Life Sciences      Packaging