The Zacks Consumer Products – Staples industry comprises manufacturers, marketers and distributors of a variety of consumer products, including personal care items, stationery, bed and bath products, cleaning equipment and household goods like kitchen appliances, cutlery and food storage among others. Some of the industry participants provide batteries and lighting products, while the space also includes food store retailers operating supermarkets, superstores, drugstores and convenience stores.
Let’s take a look at the industry’s three major themes:
Demand for most products in this industry remains more or less stable as they include essentials used in daily lives. With the industry being at its mature stage, consumer product players are focused on getting more out of their operations and coming up with unique revenue-boosting initiatives, mainly aimed at keeping pace with changing consumer patterns. While demand for such products fluctuates less, competition from cheaper alternatives is a threat.
Buyouts and divestitures have been helping these companies build a better portfolio and increase focus on areas with higher growth potential. Efficient pricing is another tactic to capture market share. Some of these companies are fortifying their position through store expansions and lucrative reward programs.
Quite a few players are making efforts to enhance their digital and e-commerce capacities. They are committed toward making digital marketing plans and other investments to augment e-commerce sales. While these endeavors could boost sales, the related costs will keep margin under pressure. Apart from this, higher marketing, advertising and other growth-related investments could put additional pressure on margin. Nevertheless, companies are making efforts to curtail costs.
Zacks Industry Rank Indicates Dim Prospects
The Zacks Consumer Products – Staples Industry is housed within the broader Zacks Consumer Staples Sector. The industry currently carries a Zacks Industry Rank #196, which places it in the bottom 23% of more than 250 Zacks industries.
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