Smucker’s coffee momentum is still strong.
Boston — According to Mark T. Smucker, chairman, president, and chief executive officer of J.M. Smucker Co., located in Orrville, Ohio, the company’s coffee business has improved as a result of its capacity to meet consumer trends.
At the Barclays Global Consumer Staples Conference in Boston on September 5, Mr. Smucker stated that while the company is confident in its ability to succeed in the dry coffee market, it is also focused on capitalizing on the growing consumer preference for liquid concentrates.
“We believe there’s a significant opportunity there to capture that consumer as they continue to create those ‘cold coffee cocktails at home,'” he said, adding that consumers are continuing to customize and attempt to recreate their favorite coffee shop beverages at home. Those multi-serve bottles contain 20 servings. “There are many good things in the coffee category. We have a great deal of confidence in our ability to perform there going forward.Tucker H. Marshall, Smucker’s chief financial officer, responded that the company is still moving forward when asked about the impact he saw from some of the action surrounding volume and share.
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“Overall, our coffee portfolio is continuing to gain momentum in opposition to at-home leadership with brands like Folgers, Dunkin’, andCafe Bustelo,” stated Mr. Marshall. Additionally, the overall top line for coffee will be flat to down year over year. And a big part of that has to do with the pricing and deflation that we’ve noticed in terms of better price points and consumer-focused pricing. However, we are
underlying volume momentum is evident, especially when considering Starbucks, Dunkin’ Donuts, and Folgers. Therefore, we do anticipate more momentum there.Regarding diversifying into other coffee formats, Mr. Smucker stated that the company’s brands are competitively strong in those markets.
“Clearly, the introduction of Dunkin’ and the subsequent introduction of the Bustelo liquid products in a few quarters is a step further along that strategy,” stated Mr. Smucker. Nevertheless, we have mentioned a few points fairly consistently when discussing M&A in general. We would like to expand into our current categories, which are coffee and pets, particularly pet snacks, if the right assets are found at the right price. If we could decrease the amount of frozen food we would like to take, as we clearly have Uncrustables by the tail and want to keep concentrating on them.”