PepsiCo, along with Coca-Cola, Nestlé, P&G, and Kimberly-Clark, have issued similar warnings in recent months due to a host of factors, including disruptions in global supply chains and rising demand that has pushed up raw-material prices.
The move to raise prices will also be used to offset higher advertising and marketing costs, which rose 30% in the period as the company looked to take advantage of a reopening of the US economy.NamNews Implications:
- Despite government reassurances, anyone in supply and retail knowns that significant costs increases have been building within supply chains.
- These cannot be absorbed and so will result in shelf price increases...
- ...and strong brands will be able to sustain demand.
- In terms of sizes of price increases, this will depend on moves by significant players in each category.
- We would anticipate double-figure rather than single figure % increases...
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