Fred Cefalu

I see some retailer-distributor gross margin re-alignment coming to play over the next two years. It's not just the margin or markup itself, it's the fees and deductions. The cost of this re-alignment will mostly be shouldered by the revolving door of emerging CPG brands. How future-proof is your brand? https://lnkd.in/gpe74APt? #emergingbrands #retailers #grocery #margins #distributors #entrepreneurship #cpgcategory #foodandbeverage

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OK...I don't think any real CPG company would enter a new product category with 4 different brands. But Tilray is not a real CPG company, which is why they are entering the hemp-derived Delta-9 THC beverage category, with 4 different brands. "420 Fizz is a sleek and modern brand built off Tilray’s iconic 420 beverage platform. Enhanced with 5mg HDD9 per can, 420 Fizz is an exciting new seltzer with a refreshing taste. Herb & Bloom, a super-premium mocktail, offers a unique way to experience timeless classics with its harmonious blend of refreshing fruit notes infused with 5mg HDD9 per can. Each drink is crafted for a smooth and balanced experience, resulting in a delicious taste. Welcome to a world blooming with possibilities. Fizzy Jane's is a light and delicious seltzer with 5mg HDD9 per can and three classic flavors Blackberry, Blood Orange and Vanilla. A nostalgic brand created for the curious consumer. Happy Flower is inspired by classic cocktails, with a citrusy Margarita, a juicy Strawberry Daiquiri, and a bubbly and fruity Peach Bellini. Each Happy Flower cocktail contains 5mg HDD9 THC per 12oz. can and provides a new way for consumers to relax and unwind in a format that’s familiar, convenient, and delicious. Tilray will launch Happy Flower in partnership with Emergent Beverage in the Texas and Louisiana markets." That's 4 different brands to properly position and gain listings and generate consumer awareness and trial and refine...it's just too much at once. I spent 25 years in CPG, and ran a number of beverage-related brands like Maxwell House Coffee and Del Monte Fruit Drinks and Bacardi and Grey Goose Spirits and bev-alc RTD's and I cannot recall ever trying to launch 4 brands at the same time, especially into a still nascent and changing product category. It just seems business irresponsible - it might make for good investor fodder, but it's not smart marketing strategy.

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#RTDs are all the rage in the #Beverage industry these days. Rightfully so. New spirited concoctions hitting the market seemingly every week, attracting young consumers at college campuses, night clubs and beach parties all across the country. But for beverage companies, just getting in the mix won't cut it. In this article, our AlixPartners beverage experts explore the foundational drivers behind the RTD revolution and provide valuable advice for those who want to cash in. Enjoy the read... #CPG #Growth #Strategy #WhenItReallyMatters

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Aggregate demand across a multitude of manufacturing markets are directly impacted by the state of retail demand. This article/interview of former US CEO for Walmart is confirming details of an "inferior market" situation in the US that is already evident in key markets like automotive. Arguably, entire demand markets like electronics are taking hits as well. For manufacturers tied directly to GDP value chain demand, or in the case we find ourselves "True GDP Demand", finding better ways to assess their immediate and intermediate demand will be critical. Those late to the intersections of market dynamics will be behind. A recommendation: stop focusing on dollar based demand and dollar based activity! Unless your fixed costs can be managed with high variability, watching dollars movements inflated by government spending will not result in volume demand to spread out those fixed costs. Worse you will be carrying capacity for which there is no need. #USEconomy #Market #B2B #B2Bmanufacturing #macroeconomics #fractionalmangement #materials #chemicals #paper #packaging

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Why is this the smartest thing Walmart has ever done in Private Label? During the pandemic, Walmart experienced unparalleled growth across demographic profiles, but as inflationary pressures entered the equation the past couple of years, Walmart has experienced nearly all or in some cases their entire growth (depending on the category and dept) from High income shoppers. And, it wasn’t from just shoppers already in the box—it was from channel shifting coming from the broader retail landscape. What makes that shopper unique is their participation in Private Brands at their former retailer of choice, more upscale Private Brands at Target, Kroger, HEB, Publix etc. With that shopper now in the Walmart stores, and the fact that these inflationary pressures won’t last forever, how do you keep them? How do you elevate the Private Brand experience for that shopper group and over-deliver on what an elevate private brand can be? And, as we continue to gain knowledge on how food can be the driver of our health, how do you also provide more access to healthy, life-giving foods to all income groups and demographics? How do we address the fact that many people experience lactose intolerance and have a dietary need for non-dairy products in their everyday lives? Or, that many children and adults suffer from dairy, egg and other food allergies that require them to access foods without these ingredients? Have a family member that are lactose intolerant or a milk allergy—why should they not have access at the best possible prices to incredible, delicious, non-dairy products that address those needs? Enter Bettergoods. It addresses so many of these questions and is just getting started. This is one more reason why Walmart is for every shopper, every income group, and every demographic profile. This launch demonstrates Walmarts strategic thought leadership, being aware of what is happening with the shopper in their box, and being willing to meet the needs of these shoppers. I can’t wait to see how far this brand goes and how many people are positively impacted by it. Kudos to Denise Wright for being the visionary leader and to her team for bringing this opportunity to life for Walmart. Well done. #Walmart #PrivateLabel #BetterGoods #NonDairy #Culinary #ChannelShifting

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I think food & beverage companies might be doing a poor job of navigating the narrative around gross margins with our retailer partners. The pressure is intense on the manufacturer community, but... Gross margin indexed to 2019 is expected to be at 87 (from the FCC Food and Bev report published in Grocery Biz Mag). That's a 13 point drop in 5 years. Even if well managed and well absorbed by businesses through cuts in expenses, leading to income improvement, that is an unhealthy business. Price inflation at stores has decelerated significantly, although consumers are still paying well north of 20% more than they did very few years ago for similar baskets. So, even with the price increases in the last few years, and even as consumers have absorbed that cost, the businesses in our industry are struggling to continue building the same way they were in prior years. Commercial teams need more talent, financial discipline & understanding, greater partnership skills, and just quite simply, the capacity to deal with a more difficult environment. And from an execution perspective - new game plans are a must. Running the same plan will lead to the same results; which currently looks like a deterioration of business. Test. Try. Execute well. ****************************************************************************** Maverick Sales. We are builders. FMCG. OTC. Beauty. Bricks & Mortar. Digital Commerce. Field Sales. Canada Experts. Contact us to learn more.

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Circana’s Mid-Year 2024 Food & Beverage Market Outlook is here, and it confirms our earlier predictions—2024 is seeing modest growth, with a strong 2025 on the horizon! Check out the full scoop below.

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Diageo doubles down on non-alcoholic spirits with the acquisition of Ritual Zero Proof & now owns three of the five world's largest non-alcoholic spirit brands Ritual Zero Proof was founded in 2019, and became the #1 non-alcoholic spirits player in the US after joining Diageo’s accelerator program in 2020. Five reasons why this deal makes sense: 1) Fast growing: The US non-alcoholic spirits has been the fastest growing category with +31% L5Y CAGR. 2) Incremental: 94% of non-alc buyers in the US also purchase alcoholic beverages, spending on avg $292 more than households exclusively purchasing alcohol demonstrating the incrementality of the category to beverage alcohol. 3) High Right-to-Win: Ritual is already a #1 non-alcoholic spirits player in the US, with a strong market position and tailwinds 4) Synergistic: being a #1 player globally in both alcoholic and non-alc spirits Diageo is well positioned to build on Ritual’s current success and scale it up further leveraging its GTM muscle and category expertise 5) Close to the Core: being a part of Diageo’s accelerator (Distill Ventures) since 2020, Ritual already knows what it takes to make cooperation with a spirits giant successful, limiting risks of integration challenges Exciting times for Diageo 𝗔𝗯𝗼𝘂𝘁 𝘂𝘀: FF&A solves the most complex strategic problems of the world's largest FMCG companies across Corporate Strategy, Organic Growth, Digital RTM (eCommerce, DTC, and eB2B) and M&A. 14 out of the world's 20 largest FMCG companies are repeat Clients 𝗧𝗼 𝗸𝗻𝗼𝘄 𝗺𝗼𝗿𝗲, 𝗰𝗳. 𝗼𝘂𝗿 𝗹𝗮𝘀𝘁 𝗙𝗠𝗖𝗚 𝗠&𝗔 𝗽𝘂𝗯𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗯𝗲𝗹𝗼𝘄: https://lnkd.in/efD5RNWX 𝗧𝗼 𝗴𝗲𝘁 𝗮𝗹𝗹 𝗼𝘂𝗿 𝗶𝗻𝘀𝗶𝗴𝗵𝘁𝘀, 𝗳𝗼𝗹𝗹𝗼𝘄 𝘂𝘀 & 𝘀𝘂𝗯𝘀𝗰𝗿𝗶𝗯𝗲 𝘁𝗼 𝗼𝘂𝗿 𝗙𝗠𝗖𝗚 𝗖𝗘𝗢 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀 𝗻𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿: https://lnkd.in/ea4gy65y #fmcg #cpg #mergersandacquisitions https://lnkd.in/dXAZQ242 Pernod Ricard The HEINEKEN Company AB InBev Carlsberg Group Campari Group William Grant & Sons The Coca-Cola Company PepsiCo

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Preservation primer. When purchasing personal care products, I look for 2 things: the active ingredient and the preservative. If neither is there, back on the shelf it goes. I was so concerned about the importance of preservatives that I coined the phrase "preservative diversity" and "preservative palette" as part of preservative innovation challenge with GC3 (now change chemistry) years ago. Let's take a closer look at the world of preservation. Preservation actually isn't just preservatives. In fact, preservatives is the last step. It starts with GMP (water treatment, raw materials, sanitization, etc). Followed by physical protection in packaging design, and then physicochemical protection in formulation design (water activity, emulsion, pH), and then finally the choice of preservatives. It's easy to confuse antimicrobrials and preservatives. Antimicrobrials are bactericidal (kills bacteria), while preservatives are bacteriostatic (prevents growth). Bacteriostatis comes low concentrations that perturbate or increase porosity of cell walls, interfere with enzymes, inhibit nucleic acid replication, and chelate metals. Also don't confuse antioxidants with preservatives. They have a different meaning in cosmetic science. But this same biological activity can also result in irritation, sensitization, and toxicity. Since preservatives are used in virtually in every personal care product, safety must be evaluated as an aggregate across the sector. This is why many countries set harmonized limits, often by product category, set and reset based on usage patterns and new safety data. Conventional preservatives include acids, alcohols, phenols, aldehydes, formaldehydes, isothiazolinones, biguanide, and quats. Inherent safety and performance profiles differ greatly. Newer is the emergence of multifunctional ingredients or "preservative boosters" that by themselves are not good at preservation, but work synergistically to improve performance and reduce the concentration of preservatives, adopted in more modern personal care products. "The inherent toxicity of these ingredients is a problem that the cosmetic industry should be concerned about. Therefore, it is necessary to continue the search for non-toxic and effective preservatives." Safe conventionals + Innovative multifunctionals. This is the way ...

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Reflecting on this monumental moment, I wanted to wait until the news was "official" before sharing my thoughts and feelings... Almost 7 years ago, a good friend now who started as a good client invited me to his new office in NJ to explore a plant-based protein company he was considering acquiring. That's when I first encountered OWYN. Honestly, I wasn't sure what to make of it initially. Plant-based, vegan protein drinks weren't in my usual "repertoire" of ideation and marketing. But after trying the product that day, I knew I wanted to be part of the journey. And what an incredible journey it has been! Throughout the last 7 years, in my capacity as a "strategic advisor," I've embraced a multitude of roles and responsibilities, working closely with a diverse array of talented leaders. From individuals who made significant contributions from the outset and have since moved on, to those who have ascended to leadership positions, such as CEO Mark O. and Chief Sales Officer Matt OConnell, as well as "more recent" additions like CMO Julia Perez, who came in and made an immediate and substantial impact, our collaboration has been characterized by passion, mutual respect, and an unwavering commitment to innovation. Now, fast forward to today. After countless hours of strategic discussions, meetings, and partnerships, we've achieved something remarkable. We've taken a niche brand, crafted with the finest ingredients, and found the perfect successor in our recent acquisition. If you notice, even as a "consultant" I always will refer to it as we. When I work with brands, especially from day 1, I consider myself a true part of the team. Being part of a brand from inception to this pivotal moment is incredibly special. As a matter of fact, it's been a huge goal of mine since that fateful day 7 years ago. I'm eager to see what lies ahead for OWYN and hopeful that I can continue contributing to a product and brand that means so much to me and countless others, especially our consumers. #OWYN #PlantBased #Acquisition #Journey #Gratitude #Business #CPG #SimplyGood https://lnkd.in/emY6UT2g

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Americans are showing strong support for local small businesses, with consumers expressing a willingness to spend an additional $2,000 in 2024 to help their favorite shops thrive. Over 65% of Americans visit their local Main Street regularly, and the closure of these shops evokes strong emotions in nearly 75% of consumers. The pandemic has led to a newfound appreciation for local businesses, especially among suburban residents, with over 70% citing local economic contribution as a key factor in their shopping choices. Notably, younger generations such as Gen Z and millennials are particularly enthusiastic about the success of their Main Streets. Small businesses play a significant role in the U.S. economy, representing almost 44% of the GDP and employing nearly half of the nation's workforce, as reported by the U.S. Chamber of Commerce in 2023. Supporting local businesses is vital for community growth and sustainability. #SupportLocal #SmallBusinesses #CommunityEconomy #Locally

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Top 5 tips on building and maintaining strong relationships with retailers to secure shelf space and drive sales: 1. Meeting initial item set-up timelines with incredible accuracy 2. Updating the Retailer on any changes in the supply channel 3. Once establishing the cost of the shelf space, promote and invest to drive sales. Makes no sense to say “ I don’t have enough left to fund the requested programs.” 4. Be smart and be able to frequently review ROI on any tool or program that is used to be sure you are spending marketing dollars efficiently. 5. Continuous Evaluation, Continuous Improvement: The journey doesn't end with a deal. #cpg #retail #shelfspace

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How is the rise of GLP-1 drugs and health-conscious consumers impacting the grocery and food industry? We explore this and more in the latest issue of California Grocer magazine, “The New Food Frontier.” Read on page 16: https://lnkd.in/gMy24NSS

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As the demand for high-protein, on-the-go snacks continues to surge, Conagra is positioning itself at the forefront of this enduring trend. Conagra Brands, the force behind iconic names like Slim Jim and Duke's, has strategically expanded its portfolio with the acquisition of Sweetwood Smoke & Co., makers of Fatty Smoked Meat Sticks. What makes Fatty's unique? Their meat sticks boast high protein, low sugar, gluten-free ingredients, and no MSG—exactly what today's health-conscious consumers are after. Since their major 2018 acquisition of Pinnacle Foods, Conagra has been laser-focused on strengthening their core business and managing debt, keeping acquisitions on the back burner. But when the right opportunity comes along, especially a bolt-on that aligns perfectly with market trends, they were ready to act. With the meat snack market projected to grow at nearly 7% CAGR through 2033, this acquisition is a smart move for Conagra, bolstering their position in a booming segment. At Greenwich Capital Group LLC, we anticipate a significant increase in strategic-driven M&A activity within the F&B category in the coming year, likely surpassing previous levels. Mars' recent acquisition of Kellanova underscores the growing trend of large strategic acquirers making bold moves to enhance their market presence and diversify their offerings. This acquisition is a clear signal that leading players are not just pursuing growth, but are also keenly focused on aligning with evolving consumer demands for health-conscious, innovative products. We expect to see more deals of this nature as companies seek to strengthen their positions in an increasingly competitive and dynamic market. #MergersAndAcquisitions #FoodIndustry #FoodandBeverage #ConsumerTrends #InvestmentBanking https://lnkd.in/gT4AWgMW

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#GLP-1 #weightloss #CPG CPG and Grocery Retail seem to be entering a new phase of innovation with new GLP-1 related brands and weight loss education merchandising. Jessica DiNapoli from #Reuters provides a great write up on this topic today (see below). According to KFF, over 12.5% of US consumers have tried these new types of Weight Loss products which amounts to 15 million people, Other widely reported reports from KFF say that over 60% of adults are interested in the drugs. As a result, we innovators such as #Nestle has already launched the brand "Vital Pursuit" and retailers such as #GNC have dedicated sections to educate GLP-1 users with relevant supplements. As awareness and usage grows, this seems to be one of the key drivers in the food industry that will spur new innovation to meet the new consumer needs due to the drug implications and dietary needs. It will also be interesting to see how this affects the restaurant business and what may change on the menu. Welcome to hear more on this topic: >What other categories could see new innovation related to weight loss drugs? > What are some of the other implications and disruption that will likely take place?

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CPG Friends, I have discovered a platform that is on a mission to offer a more fair distribution method to help build your brand while also having merchandising and re-order built in and handled by their team. They are focusing as of now on convenience stores, liquor stores, gas stations, and other independents. And so far from my vetting process and speaking for hours with the CEO, they are the real deal and offer really great solutions for small, emerging brands and even large brands that are doing massive sales. We’ve all heard the pain points on here from countless brands when dealing with distribution in general in this business from chargebacks, freight billbacks(sometimes putting brands out of business) If I could help link your brand with a better solution to grow your company and retain all the sales dollars in your pocket, this could be potentially groundbreaking and flip the traditional model as we know it ON ITS HEAD. Please DM me and happy to share more information about it.

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I think consumer feedback is often under used by emerging CPG brands… Coming from a Kraft Foods general management upbringing and then experiencing start-ups for many years, I’m often thinking about which “big company” practices could bring value to young emerging companies while not screwing up their great entrepreneurial culture and founder brilliance. The one area I continue to see a gap in is “entrepreneurial” consumer feedback/market research—the lack of fast/low cost consumer research options (or even confirmation research) discussed to prevent a low velocity SKU to get delisted, to maximize brand communication, and avoid wasted spend or lost opportunity on the back end. There are some great research companies out there, but their costs (while valid and worth it) are just not in the ballpark for what many founders want to spend for or go through the time on. Sometimes it’s a lot more natural for founders to go with their gut and not get bogged down by research. And I totally get this, and it does work in many instances.   I just wish there were more options out there to efficiently confirm purchase interest between two packages or between new innovation ideas to complement founder gut. In the end, it could save the emerging brand money…. Thought I’d reach out to the linkedin community, PLEASE not from research companies selling their research, but from founders/emerging brand marketers who have been through this dilemma and have found some consumer feedback very helpful and fitting for emerging brand bootstrap budget and speed (even if their own tools or alternative ways they’ve brought in consumers more)?  This sharing might help more companies maximize their moves in the future…so hope it helps… thanks! #ConsumerFeedback #jcbgrowth

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The lunch meat market continues to demonstrate resilience, even in the face of recent challenges. I recently met with The New York Times to discuss how 52% of deli-meat sales now come from grab-and-go cases, a significant increase from 37% in 2019.   This shift is largely driven by Millennials' preference for convenience and their growing interest in high-protein snacks. While classic deli meats like turkey, roast beef, and ham remain staples, the increasing demand for convenient, protein-rich options is set to shape the future of the market. Check out the full article, "Can High Prices and Health Scares Keep Americans From Their Deli Meat," to gain more Circana insights from Jonna Parker and me:

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