Tuesday, June 30, 2020

The Simpler Life, for a While



(The above WSJ graph shows the percentage year-over-year reduction in the number of varieties per product category.)

May 28: only whole chicken, but at least it's organic
A couple of months ago we observed how only whole chicken was at the time available at Costco; the packages of parts--breasts, wings, drumsticks, and thighs--were nowhere to be found.

But it's not just food; broad sections of the consumer industry are winnowing their product offerings: [bold added]
Some IGA Inc. grocery stores now offer only four choices of toilet paper. A few months ago, before the coronavirus pandemic, IGA’s 1,100 U.S. stores typically carried about 40 varieties.

Harley-Davidson Inc. has cut some models from its motorcycle lineup. Outback Steakhouse has stripped roughly 40% of its menu, is studying whether customers care and may drop some items for good even after the pandemic...

Restaurants are thinning menus as Covid-19 changes how they can seat and serve customers. For years, eateries used new menu items to attract customers. Those often required chains to buy more ingredients and train employees, while complicating customer ordering...

Last year, auto makers built and offered more than 605,000 vehicle configurations even before taking different colors into account, according to industry research firm J.D. Power. In auto showrooms today, U.S. buyers will likely find choices more limited for now because of supply-chain bottlenecks and lower volumes, said Doug Betts, president of the firm’s automotive division...

Consumer choice in meat aisles has narrowed as Covid-19 outbreaks among meatpacking-plant workers in late April forced meatpackers like Tyson Foods Inc., JBS USA Holdings Inc. and Cargill Inc. to temporarily shut plants and allocate workers to lines producing more basic products, meat-company executives have said.

The result in grocery stores has been more bone-in hams and chicken breasts with ribs attached that require less hands-on cutting in plants. Though meat plants have resumed operations, many workers have continued to stay home. “Right now,” said Will Sawyer, economist for agricultural lender CoBank, “the processors are more focused on supply than they are the convenience.”
It does look like we will have to live in a world of fewer choices for a while. That's what happens when it's a supplier's market for an extended period.

When the manufacturers and supermarkets go looking for customers again, the niche offerings will return.

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