COVID-19: what will happen to manufacturers, supermarkets and HORECA?

Published by: borja.diazpache
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La extraordinary situation of the COVID-19 that we are experiencing puts us back into what is really ordinary. An example of this is that these days i was studying the productive sectors with one of my children and when the He asked me what was the primary sector, I replied: "the sector that means that in extraordinary situations we can eat at home as if it were a normal situation".

And there are situations in life that force us to remember, From overnight, what is truly important.

The reality is that el channel modern food It has been overwhelmed, with a clear focus on supply and logistics. From 9 to 15 de March supermarket chains marked a record sales history: 70% more than the same week of 2019, with growth 77% in packaged products and 51% in Fresh. Figures that have directly impacted the Average ticket with an expense of 85€ during the period of confinement. Furthermore, and if that was not enough, ehe sector had already been growing the two previous weeks at rates of 8% increase in sales.

How has e behavedThe client in el online channel?

In the first week of March sales through this channel in supermarkets they increased almost 40%. Also, 1 of each 10 people admits having purchased basic necessities for the first time through ecommerce. So, aquellas brands that they were already very advanced in their technological platforms, they have been able to supply almost all of their demand.

But not only is there an increase in sales in all the supermarket chains, but these chains as well they are increasing, at the same time, la profitability. Also, important regional supermarket chains have also had time to run ad campaigns, very focused on what we will do when this situation happens mwalking, So, un message of encouragement to all consumers.

Profitability in the spotlight

But so whatit is is happening with manufacturers? Here is funny behavior of consumers: beyond the massive collection of toilet paper, products such as coffee, milk, chocolate, beer, soft drinks, kitchen robots and hair dyes they are growing exponentially.

Given this panorama, it is obvious that salen more benefited those in which their sales volume is higher in modern food versus en the channel HORECA. By contrast, the rest will diminish their profitability in the coming months.

We see it with the soft drink manufacturers in the that of all your profitability, 60% is achieved through the channel HORECA and 40% through food. UOnce this situation has passed, they will have to react to their customers to obtain, in the shortest time possible, bring consumers back to bars and restaurants, knowing that their purchasing power will be reduced.

Another clear example is los beer makers, where isa situation becomes more acute since en some cases profitability can be 75% of the total in the channel HORECA. From herewe launched un recognition to algunas brewers what hasn decided not to do an ERTE (until at least 31 may). Ua brave decision and that puts the employee at the center.

Therefore, it must be taken into account that when pass any situation of the crisis of COVID-19 the consumer will be demanding againwill love again live a different, unique experience that gives you much more value.

Think from the client and for the client

  1. En HORECA: As soon as this situation happens I do not knowodra waste even one more minute. El bar owner o restaurant will demand help from the manufacturer because that consumer is going to want that support him in their consumption otherwise. EThe manufacturer should listen to both y understand whatit is going to need in the coming months. Furthermore, lbrewers, soft drinks etc. they must be prepared to try to get the balance of the profitability of the channels back to what it was before this situation.
  2. En feeding: oronce the current situation has been overcome, andconsumption is likely continue on the rise, with smaller increases, but at a good pace. As a chain, it is the ideal time to differentiate yourself, to obtain give that extra that the consumer asks for. And is thatAlthough 82% of the chains have already provided measures to avoid contagion during all these weeks of confinement, once the state of alarm is over, the consumer will continue defendant new and better health measures and hygiene In the supermarkets. And of course, tnot will be able forget about those customers who, still frightened by a possible contagion, they will become faithful to the online channel.

Therefore, now more than ever, dwe will listen to the client and understand what require in this new period that opens after this situation so that he lives a new experience that lives up to your nueva demand.

And above all, gthank you allmanufacturers, distributors and truckers for your intense work all these days. OI assure you that my son not will forget you never what he is primary sector.