Darcy Horn Davenport

Interesting take on the battle for consumers during months like Sober October and Dry January from Stephanie Cain 👇 Her commentary below with link in comments 🍻🥂🍹 The wine industry has launched an assault on #SoberOctober and non-alcoholic beverages as if the sole existence of the booze-less category is to put a hit against wine. With its new campaign, Come Over October, wine folks are declaring you should grab a glass instead of going sober, because wine brings people together. Instead, #wine should really be looking at their core messaging because that's why wine is declining. At the #ComeOverOctober kick-off party, I had a conversation with a salesperson of a wine distributor. He attempted to be ok with the evolution of wine by explaining that ready-to-drink, single-serve wine brand, BeatBox, marketed to the 21 to 25-year-old set, was crushing the market. He was all for it. While the brand has wacky flavors like blueberry lemonade wine, he felt that every wine consumer “starts somewhere.” It was promising to him because he said they would “continue their wine journey” and start “drinking real wine.” So many problems here but here is the big one: They don’t often continue the wine journey. News flash, wine people! Consumers don’t have time. We don’t desire it. We want to build connections, not spend the evening only discussing what we want to drink. We have jobs and travel and bills to pay and kids and dogs and aging parents and hell, we just want to buy a house. We have no job security. We have been hit with recession after recession. Right now, inflation is making our groceries cost some 40% more. You really think we are jumping at the time-consuming task of learning about wine? Get real. We’ll grab a #Martini. And start ranting. Which is exactly what I'm doing in today's The Mad Ones 👇 Link in comments. #health #wellness #marketing #alcohol #alcoholfree

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“Growing a CPG company, especially in the food and beverage space, ‘is astronomically harder today,’. ” Paul Voge you said it, man. So many truth bombs dropped in this article about the challenges and difficulties growing and scaling a CPG brand in today’s world. The cruel reality is that it takes a whole lot of money or a whole lot of time (and most times both) along with a fair amount of luck to have a chance at making it. If you dont have a ton of money then you better have a ton of time, some good fortune, and a product that can withstand many changes of the seasons (and "trends"). For most emerging brands today its all about survival and just finding a way.  There are lots of traps out there– lots of shiny objects– lots of vanity metrics hoping to be noticed and cared about–but at the end of the day sometimes its just about living to see another one. Here’s to all you day-to-dayers and week-to-weekers out there that are all just finding a way. Keep finding it.

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Millennials make purchasing decisions that reflect their ethical beliefs and budget constraints. Brands can cater to Millennials' ethical and budget preferences by offering functional foods and multi-benefit products. These products not only resonate with the health and wellness values of Millennials but also provide significant additional value, making them highly appealing to this cost-conscious demographic. As Millennials seek products that align with their values without breaking the bank, there’s a unique opportunity for innovation in the functional food sector. Understanding this shift is key to meeting their expectations. Read more about this consumer group here: https://bit.ly/3VCHrDQ FoodNavigator USA Ryan Daily #valueshoppers #consciousconsumers #functionalfoods

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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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UNFI just reported a surprisingly good Q3. Everyone in our industry should be celebrating. Their earnings call outlined how their larger Natural/Organic/Specialty accounts (WFM/TFM/GFH) are performing well. It’s a good thing, that these accounts are continuing to perform well and showing consumer resilience against persistently high pricing. This opens more innovation into more doors, and allows for the transfer of market share from Big CPG to emerging brands. It’s also a good thing their simplified fee structure (SSA) is paying off and producing more sustainable EBITDA rates for them because the stability of their supply chain network is important for retailers. There’s a nascent cottage industry built around helping small brands navigate UNFI’s “deduction” process. It’s important to understand that this 7% “Inside Income” forms the basis of their core profitability model. Nobody is going to “outsmart” or “outhustle” that 7% model long-term. Every brand signs the Policies and Procedures document and the details are all in the minutiae there. It’s important to understand that UNFI does not make its profits selling product…they earn more than 100% of their EBITDA by BUYING product. Their fees aren’t “predatory” they are just optimized for mature, larger brands who make up more than 80% of their sales. If you want a simplified no deduction model, and you don’t want to have to patchwork together 5-10 smaller distributors to reach national scale, you should work with us instead. We only make money when we sell product and we only work with emerging, growth brands. ALL of our fees are posted on our website, and we explain them to every brand that onboards with us in a 30 minute call. We can onboard you by the end of the day today if you want. Otherwise, UNFI is a very competent incumbent, and they are here to stay. Pod Foods #innovation #unfi #grocery

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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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Kefir-- a fermented dairy beverage-- is rising in popularity. I weigh in on this good-for-you drink in this article via Layla Khoury-Hanold via Food Network where it takes about: --What is kefir? --How is kefir made? --What does kefir taste like? --Health benefits --The difference between kefir and yogurt --And of course, HOW to pronounce it!

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HUGE deal: PepsiCo is acquiring Siete Foods for $1.2 billion. Before you doubt that valuation, I’ll say it:  Siete earned their price tag. CPG is hard.  Fundraising in this economic environment is hard. Disrupting stale categories (beans, tortillas, salsa, sauces) is hard. Challenging multi-brand, billion-dollar companies is very hard. Winning market share in salty snacks (chips) is very very hard. Building a multi-category food brand is very very very hard. Getting acquired by your biggest competitor – near impossible. All of those accomplishments are a legacy to be proud of. But the hardest work is just beginning. Because now it’s the family of founders’ job – all 7 of them –  To protect the legacy that they’ve built. To preserve the values that made this brand what it is today. To fight for what they believe when literal billions are at stake. Siete Family Foods x PepsiCo, Keep fighting the good fight. #food #innovation #mergers #acquisitions #marketing #finance

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A simple quote from Mike Tyson and one of my favorites of all time: "Everybody has a plan 'till they get punched in the mouth." It rings true in the day to day battles of business, especially in CPG. Here are some examples many CPG founders go through or ones I've personally battled: 🥴 You launch a product, did all the research for R&D, focus group testing, and reviewed the packaging thousands of times before launching, but still something went wrong either with shelf life, negative consumer/retailer feedback, or weak sales on shelf 💰 You had cash flow projections in place and expected that with X amount raised, it would last you for Y Months, but ran short of runway and were scrambling to raise more cash to keep the company going in difficult times 🤝 Formed partnerships, only disappointed to find out the partner backed out, or it wasn't the partnership you envisioned and now you are doing damage control and it's causing emotional pain to be with this person 🚛 Brought on a distributor thinking they would push the brand and it would be an estimated cost, but they didn't do their job, and the costs ended up sky-rocketing from chargebacks, thus losing money on every unit 😲You release a great product, and then a competitor comes up with a version of yours that is a lower price point and they have all the marketing dollars in the world to out-compete you. I can go on and on, but in this business, like any business, you have intentions when you go into it, and many times, it doesn't turn out the way you envisioned. What's your story of getting punched in the mouth?

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Major news in the FMCG world today - Mars and Kellanova have struck a historic $35.9 billion acquisition deal (14 times Ebita from last Qtr). This deal is one of the largest in packaged foods business since the Kraft and Heinz merger. Note Mars accquired Wrigley in 2008 for $23B. Will this move set to reshape the food manufacturing landscape? Mars’s acquisition of Kellanova is expected to complement its existing portfolio, which includes brands such as Snickers, M&M’s. In 2023, Mars reported net sales of more than US$50 billion, driven by its 150,000 associates across pet care, snacking and food businesses. Mars’s pet care portfolio includes the likes of Royal Canin, VCA, Pedigree, Banfield and Whiskas. As these giants combine forces. This will advance Mars’s strategic vision for the future of snacking. The integration of Kellanova’s brands will provide Mars with entry into new snacking categories, including the addition of billion-dollar brands Pringles and Cheez-It to its portfolio. The acquisition will also enhance Mars’s health and wellness offerings with products such as RXBAR and NutriGrain, aligning with global current consumer trends. Kellanova has their Better Days Promise initiative and Mars has their Sustainable in a Generation plan. Their combined impact will be significant in the world of food.

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Hey Network: "There is no silver bullet to guarantee product adoption in the marketplace. However, businesses can implement strategies before launch to improve market readiness and increase the likelihood of securing a place in consumers' weekly dinners." If product adoption is something that your company struggles with, please listen to this episode CPG Launch Leaders featuring TPG's own Eleni Shipp and reach out to Eleni or I so that we can share strategies that can help you secure your place in the weekly dinner rotation. #food #CPG #newitems #newitemlaunch #ecommerce

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What Got You Here Won’t Get You There: This is the story of many CPG brands that once enjoyed profitability and significant market share but are now struggling to stay relevant in a rapidly evolving competitive and technological landscape. For a CPG brand that once thrived but now finds itself grappling with low cashflows, shrinking margins, and a stagnant topline, the future depends on decisive, strategic shifts. It’s a classic catch-22: do you invest in brand building to stay top-of-mind, or refocus on reformulating products or upgrading machinery to stay competitive? Here’s a strategic playbook to help navigate these complex choices: ◀️ Laser-Focused Investment: Develop a clear game plan. Prioritize investments in the brand, product innovation, and operational efficiency—but stay selective. Every dollar should bring measurable impact. ◀️ Modern Brand Building: Leverage content creators over traditional media. They bring authenticity and targeted reach, often at a fraction of the cost of TV or other conventional ads. ◀️ Lean Inventory Management: Adopt Just-in-Time practices, reduce slow-moving products, and optimize your inventory to save on warehousing and carrying costs. ◀️ Strengthen Cash Flow: Tighten working capital by reducing customer credit terms, exploring receivables financing, and negotiating extended payment terms with vendors. ◀️ Smart Reinvestment: Channel profits back into quality improvement, sustainability initiatives, and cost-efficient warehousing, transportation, and supply chain improvements. Waste reduction should also be a priority to further enhance margins. A full-time or Fractional CFO can be a game-changer in guiding this journey. They bring accountability, track key KPIs, and implement a Balanced Scorecard to keep tabs on your brand’s financial and operational health. It’s time to take a bold, structured approach to stay relevant—and profitable—in today’s evolving market. ****************************************** P.S. I am a Fractional CFO helping businesses take informed financial decisions with peace of mind while having some fun in this process. Please contact me at [email protected] if I can be of any help in your CPG Transformation Journey. Brain Expansion Group Startup Ecosystem Canada Fractional CFO The CFO Centre Canada

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meati™ Raises $100 Million! 🌿 Embracing Opportunity in Plant-Based Innovation 🌿 Despite the current slowdown in VC investment in plant-based foods, Meati Foods recently secured a $100M Series C round, led by Revolution Growth and Grosvenor Food & AgTech (see article below). Key Takeaways for Startups & Brands: - Innovative Technology Matters: Meati’s MushroomRoot™ tech sets them apart in a crowded market. - Strategic Expansion is Key: Scaling their production and retail presence is driving momentum. - Investor Confidence: Large investments signal that there’s still trust in unique, scalable concepts. At PlantBased Solutions, we understand these trends and can help international plant-based companies launch and thrive in the USA. With experience in launching Better Foods, You Are What You Eat by Shinsegae, we're ready to support your expansion strategy. Let's connect to discuss how we can help find solutions for your business. #PlantBasedSolutions #MeatiFoods #PlantBasedMeat #FoodInnovation #VentureCapital #CPG, #VeganBusiness

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From prebiotic sodas to collagen waters, beverages are trying to do the most. Consumers are drinking it up, an excellent article on this topic by Keren Landman, well worth a read. Consumer demand for drinks that offer added health benefits — known as functional beverages — is booming, and manufacturers are giving consumers what they demand. Olipop is just one of a growing group of “prebiotic” sodas, which claim to give a boost to the good bacteria in your gut microbiome. And prebiotic sodas are themselves just one of a cascade of these so-called functional beverages that are taking up increasing space in the global drink aisle. Worldwide, the market for these products exceeds $150 billion, and it’s expected to top $200 billion in the next 4 years, with millennials twice as likely to consume them as any other age group in 2023. The proliferation of drinks in this category peaked just before the pandemic, but consumer demand for them has been on the rise ever since, jumping more than 50 percent in the US since 2020. In some ways, looking to beverages for added benefits is nothing new. Humans have been demanding medicinal effects from liquids for a long, long time. Ancient Chinese medicine and the Galenic and Hippocratic methods practiced in ancient Greece embraced tea and wine as therapeutic agents, and we’ve relied on coffee’s stimulating effects for more than a millennium. The future is bright for functional beverages and it is a category full of opportunists to meet consumers ever growing proactive health needs for healthier and more functionally orientated beverages #health #functionalbeverages #medicine #supplements Carol Dunne Gwyneth Kelly Michelle Osagie David Deeley Brian Short Sheelagh Pentony Elizabeth Horvath Nina Riggins Jordan Dow Mark Allen Mindy Leveille https://lnkd.in/eNpwePXz

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Great introduction to the inevitable advantages of using #incredo sugar-based sugar reduction solutions!

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We need more ways to support innovation in #cpg, particularly for #emergingbrands. Nosh posted an article a little over a week ago about innovation in food and beverage CPG plummeting by almost 50% this year. I’ve been thinking about it a lot. First because it mirrors what I’ve seen at Pilot R&D—not a 50% drop, but we’ve found clients extremely restrained and risk-averse this year. Everyone’s dipping a toe in the innovation waters and starting with 1 SKU, not the normal 3 to 4, even though they know retailers will be clamoring for that bigger brand block. From where we sit, this new conservatism in innovation isn’t driven by consumer or retailer demand, which seems hotter than ever, but by capital pressures. It’s no secret that VCs have scaled back dramatically since the boom times of 2021 and have shifted their investment thesis to investing in brands focused on fundamentals and profitability. The issue, however, is that now many brands don’t have the necessary capital to properly resource their companies to deliver on those fundamentals. A conversation I’ve been having with small groups of people for the last 5 years is that #cpg is hamstrung by a single model for innovation and growth—the startup. Other industries, e.g. health and beauty and fashion, have additional models that allow founders to plug into existing infrastructures and capitalize on best-in-class resources to ensure strong fundamentals from the start, e.g. Coty and LVMH. In the absence of other options, and in a restrictive capital environment, startups are left between a rock and a hard place to focus on fundamentals without the necessary resources to help them do so, which leads to some crazy results like negative gross margins, companies needlessly co-packing overseas, companies failing to have core knowledge about their product, and companies failing to invest in their future through innovation. I am not a social media person. If I'm being honest, it intimidates me and, with LinkedIn particularly, triggers my imposter syndrome. That said, after 5 years of talking in small groups about this, I’d love to widen the circle and have a broader discussion. It’s also our mission at Pilot R&D to support brands and innovation any way we can, which includes raising our hand to help forge a new path in #cpg. In the absence of giant multinationals creating this infrastructure for brands in our industry, I think it will take strategic partnerships among the right players to build this new model. Given I never post on social media, I’m sure the algorithms will serve this to 4 people max, so if you know of anyone who has thoughts on this or is interested in building things, please share. If you think this is a terrible idea, by all means, let me know why. We need to come together to invest in innovation to ensure that next year we reverse this trend, as we’re creating way too many delicious products right now to see them fall by the wayside.  

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Here’s yet another shrink-to-grow portfolio move (speculated) in the food space.  If it wasn’t clear before, it is now: big food companies are VERY focused on improving growth and apparently shedding slow-growth anchors is a preferred lever in this environment. This strategy is understandable, because they can control a divestiture more than trying to make an acquisition, or a series of acquisitions.  Of course, they still need a counter-party to do a deal, but this specific business and others that have been announced, discussed or completed (e.g., Kellogg and cereal, Unilever and Ice Cream, General Mills and Yogurt) is big enough that the public markets are always a viable transaction partner. If you needed any more convincing (which you probably don't), the divestiture bandwagon suggests some conviction about future growth levers in the big food c-suite: 1. The pricing window is truly closed.  Pricing has driven topline in the recent past but now organic growth will have to come from other sources – and the only foreseeable catalysts for unit growth are lower pricing (no thank you, apparently) or innovation (see point 2). 2. Innovation confidence is low.  Small food companies are the innovators and growth-makers in this industry.  They are taking share and have been for over a decade.  Apparently the big guys do not expected this to change anytime soon. 3. Portfolio growth exposure = growth reality.  Big food companies are growth-takers.  They grow at the underlying growth rate of their combined geographies and categories – faster growth will come if they can improve this underlying growth exposure. https://lnkd.in/gaNBYeKS

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Is your business targeting #GenZ coffee consumers? "Recent analyses, including insights from The Economist, have highlighted that Gen Z have a higher income than its predecessors, the #babyboomers and #millennials.  The article reports that a typical 25-year-old Gen Z-er (or Zoomer) has an annual household income of over $40,000, more than 50% above baby-boomers at the same age. While factoring in inflation and current cost of living might make these numbers less sensational, they still demonstrate that Gen Z holds considerable #economicpower." Check out today's article at Coffee Intelligence. Sarah Eleanor Charles spoke with William Dunaway about the preferences of Gen Z and millennial coffee consumers, as well as their priorities such as sustainability, community, brand building, and fun and exciting products. https://lnkd.in/e9NMCTqn

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