Quality Marketing Features | October 2022: Manufacturers and Suppliers of Consumer Goods | So Good News
The increase in prices on the shelf may be delayed next year because many manufacturers of consumer goods and retailers believe that prices are “very important” in today’s market and less than 40% of manufacturers say they want to increase their prices in the first half. of 2023, according to a report by Advantage Sales, a division of Advantage Solutions.
“Advantage Sales Outlook | October 2022,” based on more than 100 responses to a survey of selected Advantage Sales customers and clients, found one-fourth of developers are not interested in price increases and 37% are not sure whether they will increase prices in the first half.
When price increases occur, the majority of retailers (62%) say they are exceeding shelf life, but are still pushing their limits. A minority (5%) say they are raising retail prices higher than average to increase their margins.
Among the findings of the report are:
- The most common ways for manufacturers to manage low prices in the first half of 2023 is to invest in retail products and establish existing payments.
- Over the past six months, 6 out of 10 manufacturers surveyed have reduced their marketing spend. Eight out of 10 people plan to reduce their retail spending to some extent in the first half of 2023 and seven out of 10 will cut some retail spending.
- To meet the needs of value-conscious consumers, retailers are focusing primarily on value; They say they plan to expand their private label assortments, expand promotions and consider long-term price cuts. The main strategy of manufacturers is to advertise their products as reliable and high quality.
- Almost nine out of 10 retailers say their assortments will include more private brands in the next 12 months. To compete, manufacturers say they will lean on new products, marketing and new CD designs.
- If deflation occurs, many manufacturers sell their products through sales; half expect to drop savings all the way down to improve their P&Ls. Many sellers, however, would consider lowering their daily rates and increasing advertising.
- Despite continued investment and opportunities in digital commerce, manufacturers and retailers expect most of their growth to come from brick-and-mortar sales.