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No bacon, no bath tissue: Panic buying's back with COVID surge

By Anne Riley Moffat, Carolina Gonzalez and Sarah McGregor, Bloomberg News on

Published in Business News

Kraft Heinz Co. CEO Miguel Patricio said in an interview last month that the company has been finding new partners and investing in the productivity and capacity of its factories to meet rising demand.

That means "new machinery, or even bringing back to life lines that we considered in the past as obsolete," he said. The company is working on "all possible fronts to increase capacity and we've been able to increase it substantially. We increased capacity on average by 20% and that goes up to 56% on products where there's a higher demand," like Philadelphia Cream Cheese or macaroni and cheese, he said.

Mark Schiller, CEO of Hain Celestial Group Inc., said that the company, which makes Terra vegetable chips and plant-based Dream milks, was readier for this round of panic buying.

"We are far better prepared," he said. "We have about 50 million more dollars of inventory on hand, of all the things that have the longest supply chain and the least amount of backups."

ELUSIVE BALM

Toilet paper is a tougher one to find, with consumers sharing on Twitter photos of bare shelves — and pleas to fellow shoppers to share the supply. "March 2.0," observed one tweeter.

Kimberly-Clark Corp., maker of Scott and Cottonelle toilet paper, said it was cooperating with its clients and customers to keep tabs on supplies and fill inventory gaps. The company has accelerated production since the pandemic hit, including making fewer variants of products and finding capacity in its global paper supply network, said Arist Mastorides, president of the family care unit in North America.

Procter & Gamble Co. spokeswoman Jennifer Corso said the maker of Charmin continues "to work around the clock to produce product as quickly as possible."

"Paper towel consumption is related to increased cleaning situations, as consumers are cleaning more frequently," she said. "Toilet paper consumption is tied to the increased amount of time consumers are spending at home. For both, people are consuming more and stocking their pantries at a higher level than before the pandemic."

 

BREATHE DEEPLY

Panic buying is also hitting another part of the consumables market.

Ben Kovler, CEO of Chicago cannabis company Green Thumb Industries Inc., said on an earnings call this month that while purchases aren't yet back to March's booming levels, it's "marching back there slowly."

Unlike at Walmart, where shoppers are coming less often but buying more, Green Thumb's Rise stores are seeing more customers, he said. And unlike staples that get used at a steady rate, when people buy twice as much cannabis, they quickly use it. These are, after all, stressful times.

"They consume more," Kovler said. "That's not a bad thing for the business. We don't think that's a bad thing for the consumer."

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With assistance by Nic Querolo

(c)2020 Bloomberg News Distributed by Tribune Content Agency, LLC