From toilet paper to diapers, here’s a slew of household staples that are about to get more expensive

Stockpiling toilet paper
  • Several companies including Procter & Gamble and General Mills have announced price hikes.
  • The goods affected include paper products and baby-care items.
  • The prices of Coke products and coffee are likely to increase as port delays pinch the supply chain.
  • See more stories on Insider’s business page.

Many household goods are getting more expensive as companies like Procter & Gamble and General Mills announce price hikes to combat shortages and rising shipping costs.

During its third-quarter earnings call this week, P&G said it had started raising the prices of some of its goods, including baby-care and feminine-care products and adult diapers from its brands such as Pampers, Tampax, and Always.

“The exact amount of the price increase will vary by brand and sub-brand in the range of mid-to-high single-digit percentages and will go into effect in mid-September,” P&G said in a statement.

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Some of P&G’s primary competitors, including Kimberly-Clark, have announced similar price increases. In March, Kimberly-Clark said it would increase the prices of top products like Scott toilet paper and Huggies diapers.

General Mills’ chief financial officer, Kofi Bruce, said during the company’s March earnings call that it was planning to increase its prices to offset rising commodity costs as its margins continued to fall. While the company did not specify what products would be affected, General Mills’ lineup of brands includes Cheerios, Chex, Betty Crocker, and Pillsbury products.

On Monday, Coca-Cola CEO James Quincey told CNBC that the company was planning to hike its prices for the first time in over three years. Quincey did not specify the products that would be affected.

Quincey said Coca-Cola planned to implement the price hikes “intelligently, thinking through the way we use package sizes and really optimize the price points for consumers.”

Coffee prices are also set to skyrocket. Peet’s and J.M. Smucker, the brand behind Folgers and Dunkin’ coffee, have said they’re facing rising costs. Reuters reported that in February, port delays pushed coffee prices to their highest level in over a year.

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J.M. Smucker also increased the price of its Jif peanut-butter products in August.

Many of these companies said sales had continued to rise in the last quarter, even from the previous year, when some people were stockpiling products at the beginning of the pandemic. While an increase in demand can only be a positive for companies, demand is outstripping supply and driving up the price of some goods.

Consumer interest is rising as the products are getting increasingly difficult to obtain because of a shipping-container shortage and port congestion.

March data from the US Bureau of Labor Statistics’ Consumer Price Index indicated that as vaccination rates increase, prices go up. Consumer prices increased in 2021 over last year at their highest rate in three years.

While there has been a large increase in the price of gasoline, the cost of food, rental cars, and hotels have also pushed higher.

For products from the brands of top companies like P&G, people are likely to see inflated prices at the grocery store as demand compounds on vaccine optimism and port congestion shows no sign of clearing.

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The prices of corn, cotton, and wheat have surged more than 50% over the past year – and it’s driving up the cost of everything from Coca-Cola to diapers

2021 03 05T123827Z_3_LYNXMPEH240MQ_RTROPTP_4_GLOBAL MARKETS.JPG
  • Futures contracts for corn are up 96% over the past year. Cotton and wheat have jumped 54% and 50%.
  • Consumer-staple giants like Kimberly-Clark, Procter & Gamble, and General Mills are raising prices.
  • The Fed said on April 8 it wouldn’t allow a “substantial overshoot” of its inflation targets.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Commodity prices have soared over the past 12 months, and consumers are about to start feeling the effects.

Corn futures contracts are up 96% over the past year, while cotton and wheat futures contracts are up 54% and 50%, respectively.

Lumber is also on a tear, with prices rising over 265% in the past year to a record high of $1,326 per thousand board feet on Monday.

The meteoric rise for commodities is beginning to have an effect on consumer-staple companies. That’s leading them to pass rising costs on to consumers.

Coca-Cola CEO James Quincey told CNBC on Monday that his company would raise prices for its products because of the increasing costs associated with higher commodity prices.

Leaders in the consumer-staple sector, including Kimberly-Clark, J. M. Smucker, Procter & Gamble, and General Mills, have also said they will be raising prices because of increasing costs for raw goods.

Prices on most of Kimberly-Clark’s North American products are set to jump by mid-to-high single digits by the end of June, according to CNBC reports.

J. M. Smucker raised its peanut-butter prices in August. CEO Mark Smucker told analysts in November that “it was very clear that we were experiencing cost pressure.”

General Mills CEO Jeff Harmening told investors on a March 24 earnings call that his company would also raise prices in the coming months amid inflation pressures.

“So I would start by saying that inflation is very broad-based, and it’s actually global. So we are seeing it across the globe, and it’s broad-based across commodities, across logistics, across things like aluminum and steel,” Harmening said.

The CEO added that his company would “use all of the tools” at its disposal, including and “price and mix,” to offset costs.

Procter & Gamble announced on Tuesday in its fiscal third-quarter results that it planned to hike prices for baby care, feminine care, and adult-incontinence products in September to respond to higher commodity costs.

The rising price of commodities, and now of consumer goods, has some experts and US senators worried about inflation.

Sen. Rick Scott wrote a letter to the Federal Reserve Chair Jerome Powell in March raising concerns about rising inflation and the central bank’s bond-buying program.

Powell has said he plans to maintain “easy-money” policies despite rising inflation over the past few months, but Reuters reported Tuesday that Powell wrote in a letter to Scott that he wouldn’t allow a “substantial overshoot” of inflation targets.

“We do not seek inflation that substantially exceeds 2 percent, nor do we seek inflation above 2 percent for a prolonged period,” Powell said in a five-page response to Scott’s March 24 letter.

If Powell does decide to raise interest rates to curb inflation, some experts say the markets may not be ready for the results.

Mohamed El-Erian, the president of Queens’ College, Cambridge, and chief economic adviser at Allianz, told Bloomberg in an April 9 interview that the US economy was unprepared for an interest-rate shock.

Read the original article on Business Insider

From toilet paper to diapers, here’s a list of household staples that are about to get more expensive

Stockpiling toilet paper
  • Several companies including Procter & Gamble and General Mills have announced price hikes.
  • The goods most heavily impacted include paper products and baby-care items.
  • Coke products and coffee will see price increases as port delays continue to pinch the supply chain.
  • See more stories on Insider’s business page.

Many household goods are getting more expensive, as companies like Procter & Gamble and General Mills hike prices to combat shortages and rising shipping costs.

During their third-quarter earnings call, P&G said it has started raising prices on some of its paper goods, including baby-care, feminine hygiene products, and adult diapers. The price hike would encompass Pampers diapers, Charmin toilet paper, Tampax and Always feminine products, as well as Depends and Prevail adult products.

“The exact amount of the price increase will vary by brand and sub-brand in the range of mid-to-high single-digit percentages and will go into effect in mid-September,” P&G said in a statement.

AP111207090833

Some of P&G’s primary competitors, including Kimberly-Clark, have already announced similar price increases. In March, the company said it would implement a price increase for top products like Scott toilet paper and Huggies diapers.

Similarly, General Mills CFO Kofi Bruce said during the company’s March earnings call that it was planning to increase its prices to offset rising commodity costs as the company’s margins continue to fall. While the company did not specify what products would be impacted, General Mills’ line-up of brands includes Cheerios, Chex, Betty Crocker, and Pillsbury products, to name a few.

On Monday, Coca-Cola CEO James Quincey told CNBC the company is planning to hike its prices for the first time in over three years. Quincey did not say which beverages would be impacted by the price increases.

“We intend to manage those [the price hikes] intelligently, thinking through the way we use package sizes and really optimize the price points for consumers,” the CEO said.

Coke is not the only drink that will get more expensive in the coming months. Coffee prices are set to skyrocket. Peet’s and J.M. Smucker told CNBC in March that they are facing rising costs. Last month, port delays pushed coffee prices to their highest level in over a year.

AP101014139295

J.M. Smucker – the brand known for Folgers and Dunkin coffee – was one of the first companies to start hiking prices when it increased the price tag for its Jif peanut butter products in August.

Many of the companies including P&G and Coca-Cola saw sales continue to rise in the last quarter, even from the previous year when people were stockpiling products at the onset of the pandemic. While an increase in demand can only be a positive for companies, demand is outstripping supply and driving up the overall price of goods.

Consumer interest is rising at the same time the products themselves are getting increasingly difficult to obtain due to the shipping container shortage and port congestion.

March data from the US Bureau of Labor Statistics’ Consumer Price Index shows that as vaccination rates increase, prices continue to go up. Consumer prices increased in 2021 over last year at their highest rate in three years.

While gasoline prices have seen the largest increase, the cost of food, rental cars, and hotels has also pushed higher.

For top companies like P&G – that encompass everyday products and top brands like Tide, Gillette, Crest, Bounty, and Pantene – consumers will likely continue to see inflated prices at the grocery store, as demand compounds on vaccine optimism and port congestion shows no sign of clearing.

Read the original article on Business Insider

CEO behind P&G brands like Tide, Dawn, and Swiffer on how to spark creativity and collaboration among your team during difficult times

Procter & Gamble CEO
Shailesh Jejurikar.

  • Shailesh Jejurikar is the CEO of Procter & Gamble’s largest business line, Fabric & Home Care.
  • By maintaining a growth mindset, he’s helped his teams thrive despite pandemic uncertainty.
  • Jejurikar has employees challenge assumptions and connect with shoppers and emphasizes work-life balance.
  • This article is part of a series called “Leaders by Day,” which takes a look at how prominent business leaders are tackling various challenges in today’s economy. 

Shailesh Jejurikar is the CEO of Procter & Gamble’s largest business line, Fabric & Home Care, which accounted for more than a third of the company’s $71 billion in sales for 2020. 

He oversees 18,000 employees globally, has more than a dozen direct reports, and competes against consumer packaged goods giants like Unilever. He’s also responsible for over a dozen iconic brands including Bounce, Downy, Gain, Tide, Cascade, Dawn, Febreeze, Mr. Clean, and Swiffer.

Jejurikar told Insider his typical 12-hour workday begins at 5 a.m. and is driven by where he happens to be in the world, whether at home in Geneva or at the company’s Ohio headquarters. By leading with a growth mindset, he’s been able to help his teams navigate the uncertainty of the pandemic – and by doing so, has more than doubled the pace of growth for his unit, from 5% in Q2 2020 to 12% in Q2 2021.

Here are the four principles he leads by:

Stay externally focused

“Our biggest creative breakthroughs as an organization have come from striving to solve a consumer’s problem, but you can only solve that problem if you understand it, and to do that you must remain connected,” Jejurikar said.

When the pandemic hit, he not only had his teams double down on check-ins with customers like superstores Target, Amazon, and Walmart, but he also had them set up one-to-one video chats with shoppers about the issues they’re facing and how they’re using the products.

“This is how we ideated Tide Hygienic Clean, which we sped to market in 90 days,” he said. “By talking directly to consumers, we learned that they were looking for a higher standard of clean. We did a lot of research on what that meant and then designed a product that removes everything that could possibly get stuck to fabric.” The product was featured in a recent Super Bowl ad about cleaning a sweatshirt with “Seinfeld” comedian Jason Alexander’s face on it.

Lean on tools for support

Prior to the pandemic, Jejurikar traveled frequently to locations to walk the corridors and interact with colleagues. But when his teams went remote, he became concerned about how he would be able to manage global R&D, manufacturing, marketing, and sales operations without physical contact.

Thanks to visual collaboration tools, he was not only able to stay close to his employees, but also boost creativity and productivity virtually.

“We found Microsoft Teams to be a very effective way to engage with each other across the globe and MURAL‘s virtual sticky notes proved essential for rapidly prototyping products in design sprints,” he said. “Perhaps the biggest surprise was how much Spotify in the rooms makes us feel like we’re working together apart.”

Challenge assumptions

As executive sponsor of Procter & Gamble’s sustainability program, Jejurika works with the company’s chief sustainability officer on frontier products like EC30 swatches, a waterless form of shampoos and cleaners in development to fight climate change.

“Our vision is to grow the size of the market we play in and grow our share of it by offering consumers new and innovative solutions,” Jejurikar said. “But our biggest challenges lie ahead.”

Faced with the dilemma of how to create products for a marketplace with many unknowns, Jejurika developed a process called “progility,” where he challenges his teams to question paradigms of what’s assumed to be true. Using curiosity to unlock consumer insights, he asks employees to look at what’s happening and find out why people are changing their behavior or suddenly using a certain product.

“In the case of Downy Unstoppable Beads, everyone assumed no one would want a fabric enhancer during a pandemic, yet it would go on to become one of Fabric & Home Care’s fastest-growing businesses,” Jejurikar said. “We had to first ask ourselves why we are assuming that it’s considered a discretionary purchase, then we realized that many people hadn’t tried it yet and needed an introduction.”

“The only way to anticipate change is to commit to learning,” he added. “Asking questions, being curious, listening carefully to the responses. A leader should always say, ‘I knew,’ never, ‘I know.'”

Embrace work-life balance

Success is not just measured against consumer expectations and sales but by employee satisfaction as well, Jejurikar said.

To this end, he instituted a mentor checkpoint to provide his employees a forum to share how the pandemic is impacting their lives and constraints that need to be accommodated.

“We’re helping our employees choose fewer things to do so they can direct their energy in the right place and stay balanced with their life priorities,” Jejurikar said.

Encouraging a 9 a.m. to 5 p.m. work day with breaks that include walks outside and calls to loved ones are some of the ways Jejurikar is helping his teams stay energized while working from home. He also models healthy practices by not checking email before bedtime and exercising five days a week.

Read the original article on Business Insider

Procter & Gamble deals agencies another blow

Hi! Welcome to the Insider Advertising daily for December 11. I’m Lauren Johnson, a senior advertising reporter at Business Insider. Subscribe here to get this newsletter in your inbox every weekday. Send me feedback or tips at LJohnson@businessinsider.com.

First: We want to hear from public relations executives. Please take our anonymous survey and tell us what you want to read about the PR industry in in 2021.

Today’s news: P&G strikes another blow at agencies, Disney’s top movie exec could be headed for the door, and why adtech firm PubMatic is going public.


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Hollywood insiders are speculating that Disney’s Bob Iger, Alan Horn, and others are headed for the exit

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Rajeev Goel, CEO of PubMatic

The CEO of digital ad firm PubMatic lays out his plan to grow the firm post-IPO and survive the death of cookie-based ad targeting

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More stories we’re reading:

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