Kimberly-Clark has millions of toilet rolls on standby.
As England joins its U.K. neighbors and other European nations in tightening movement restrictions on Thursday, consumer products giants are more prepared going into lockdown, part two.
In the U.K., Kimberly-Clark’s Andrex — Cottonelle in the U.S. — is the most popular brand of toilet paper. Manufacturing levels at the moment are reaching 3.5 million units a day. Like in the spring, the problem this winter isn’t necessarily running out of product, but making sure it reaches shelves at the same pace consumers are buying it up.
“If our consumers want products, we’re trying to serve them,” said Ori Ben Shai, who’s in charge of the company’s U.K. operations. “We hope that by doing it, consumers will end up shopping more responsibly and more sensibly and not stock up more than needed. Whereas, if there’s a sense of shortage, they may have a higher sense of urgency.”
But, he said, as uncertainty about how long the coronavirus pandemic forces people to stay home (which inherently increases consumption) or forces countries to impose routine lockdowns, supply and demand will remain in flux.
On the global edition of the “Marketplace Morning Report,” Shai told the BBC’s Victoria Craig what steps Kimberly-Clark is taking to prevent supplies from running out as people stock up.
Ori Ben Shai: We are working very, very closely with retailers. The biggest challenge is to just get the product fast enough throughout the chain down to the shelf. It’s not really to have enough product. So what would help is, part of it is having more inventory through the different stages of supply chain, in the stores themselves or at the retailer’s distribution centers, and with us as well. And then it is getting the right capacity to just ship it down the chain fast enough so it can stay as available as possible at all stages.
Victoria Craig: It’s a balancing act, though, at least financially, I imagine, for a company like you. Are you worried that if people stock up now, and they have enough for the next few months, they won’t be buying any the next period? So how does that affect your cash flow? How do you plan for that, what future spending will be like?
Shai: Real consumption is not really going up, or it’s going up to a limited extent. Fundamentally, there is a lot of stocking [up] going on. There is so much volatility. You don’t know for example, how long will this last? You don’t know how many more waves like that would happen. It’s probably going to be a cycle that we’re still going to be in. So very, very difficult to predict. We know it will be challenging, and we are probably modeling and changing our assumptions much more frequently over the last few months than we usually are.
Craig: Are you seeing sales like you did during the first lockdown? Are you noticing that people are stockpiling more than they otherwise would have at this time of year?
Shai: Yeah, there is a spike. It’s not to the extent that we’ve seen first time around during March, April. But yeah, it’s quite significant. I’d say it seems like people are a little bit less stressed than they were. They obviously went through the experience. They saw that product is eventually available. But, yeah, you’re seeing game behavior of stocking up to an extent.
New COVID-19 cases and deaths in the U.S. are on the rise. How are Americans reacting?
Johns Hopkins University reports the seven-day average of new cases hit 68,767 on Sunday — a record — eclipsing the previous record hit in late July during the second, summer wave of infection. A funny thing is happening with consumers though: Even as COVID-19 cases rise, Americans don’t appear to be shying away from stepping indoors to shop or eat or exercise. Morning Consult asked consumers how comfortable they feel going out to eat, to the shopping mall or on a vacation. And their willingness has been rising. Surveys find consumers’ attitudes vary by age and income, and by political affiliation, said Chris Jackson, who heads up polling at Ipsos.
How many people are flying? Has traveled picked up?
Flying is starting to recover to levels the airline industry hasn’t seen in months. The Transportation Security Administration announced on Oct. 19 that it’s screened more than 1 million passengers on a single day — its highest number since March 17. The TSA also screened more than 6 million passengers last week, its highest weekly volume since the start of the COVID-19 pandemic. While travel is improving, the TSA announcement comes amid warnings that the U.S. is in the third wave of the coronavirus. There are now more than 8 million cases in the country, with more than 219,000 deaths.
How are Americans feeling about their finances?
Nearly half of all Americans would have trouble paying for an unexpected $250 bill and a third of Americans have less income than before the pandemic, according to the latest results of our Marketplace-Edison Poll. Also, 6 in 10 Americans think that race has at least some impact on an individual’s long-term financial situation, but Black respondents are much more likely to think that race has a big impact on a person’s long-term financial situation than white or Hispanic/Latinx respondents.
Find the rest of the poll results here, which cover how Americans have been faring financially about six months into the pandemic, race and equity within the workplace and some of the key issues Trump and Biden supporters are concerned about.
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