Report: Paper products are on a roll
Did private label save the household paper products category during the early stages of the COVID-19 crisis?
Some industry observers, including a number of retailers, said that the private label and store brand paper products played a huge role in their ability to fulfill demand for this highly sought-after category in the spring and early summer.
In fact, many retail executives said they turned to their private label paper products suppliers and pleaded with them to supply as much toilet paper, facial tissue, paper towels and napkins as possible. The result: “Let’s put it this way,” said one retailer. “If they did not come through I am not certain what I was going to do. Thankfully, our private label paper supplier turned the engines on and got us through those crazy days.”
It was a crazy time, indeed. According to a March survey by Shopkick, 47% of consumers reported stocking up on essential items, and 85% of consumers agreed that “brand names do not matter during times like these."
What matters is availability, and manufacturers are working to make sure retailers have private label paper products in stock. “Business is very strong in this ‘new normal’ environment,” said John Sarraf, CEO of U.S. Alliance Paper, based in Edgewood, N.Y. “I believe we’re still in a pantry-loading environment. Consumer purchasing behavior continues to be skittish and panicky, and is subject to events in the news.”
Consumers are buying more household paper products because they are not working in their commercial and office settings, and are spending more time at home. “We don’t see the work-at-home trend reversing anytime soon, so I can only assume that business will continue to be strong in the foreseeable future,” Sarraf said.
U.S. Alliance Paper is helping retailers adapt to this spike in demand. “Our customer relationships have always been built on collaboration in an effort to help optimize their household paper aisles,” Sarraf said. “Working closely with our retailers is even more important today.”
The company is helping stores shift their focus. Before the pandemic, U.S. Alliance Paper was working with several retail customers on customization projects, including super-sized roll products, custom product bundles and specialty packs. Then the pandemic hit, supply chains were disrupted, and shoppers famously stripped the store shelves bare. Instead of custom or specialty products, retailers turned their attention to keeping their shelves stocked.
“They are focusing on the basics and will gladly drop slower-moving SKUs in favor of a predictable source of standard household paper, especially roll products,” Sarraf said. “We can best help them by ramping up manufacturing and our case volume to make up for gaps left by other suppliers.” In August U.S. Alliance Paper announced its plants were running 24/7/365, and had installed robust medical screeners, separated workstations and staggered hours to keep workers safe.
Focusing on Supply Chain
Sarraf said the company plans to increase capacity in 2021 by adding computerized equipment and additional lines. “We feel that, as a company, we can best serve our retailers by delivering volume, predictably, when and where they need it,” he said.