Huddle Notes From May 18th, 2020

    The huddles this week focused on how consumers are spending and shopping during COVID, comparing data from the 2008-2009 recession to current times, and how businesses are pivoting.

    Talking Points

    • Keep on the lookout for state and local city government funding sources coming out, to help businesses adjust to social distancing so they can open
    • Seeing a lot of businesses not pivoting. A pivot doesn’t have to be perfect, seekadvisement to get your business moving in the right direction!
    • An example of an imperfect yet great business pivot
      • Social Enterprise – The Hub Student Café in Lewisburg, WV, part of a larger non- profit that helped kids learn job skills. Have USDA funds to feed kids afterschool and do STEM learning.
        • Pivot: Started making meals for the kids to take home. Started receiving a ton of donated food from local farmers and businesses. Went to USDA to get waivers to sell at a highly discounted rate to parents so the entire family could eat for less than $10 total.
          • Went from 30 meals a day to their 20 original students to 200 meals a day once word spread.
          • They have no online sale capabilities, people just call in
          • The reason the families purchase these meals is because it’s good whole ingredient homemade food they know their kids will actually eat.
      • Watch or just listen to the huddle recordings to hear how others are pivoting across the nation
        • Entrepreneur Huddle
        • Consultant HuddleTrends
    • Pre-packaged & Pre-made Foods Sales Are Up
      • General Mills sales up 35%-45% last year
      • UNFI CEO Interview
        • 19 companies produce 70% of purchased foods in conventional grocery channel
        • Far more in natural and organic, proven to be more resilient
        • Thinks recession and change consumer habits could last 24 months
      • Palermo’s [frozen] Pizza is up several hundred percent, running 24/7 and adding new shifts
    • Future Consumer Index Poll
      • 4 Categories of Spending
        • “Cut Deep” – 27%; Hardest hit by the pandemic. Most pessimistic about the future. Spending less across all categories.
        • “Stay Calm, Carry On” – 26%; Not changing their spending habits. Not directly impacted by the pandemic. Worried that others are stockpiling.
        • “Save and stockpile” – 35%; Not so concerned about the pandemic, but worried about their families. Pessimistic about the long-term effects.
        • “Hibernate and Spend” – 11%; Most concerned about the pandemic. But best positioned to deal with it. Optimistic for the future. Spending more across the board.
      • Changed How They’re Shopping
    • Looking at Data from the 2008-2009 Recession (to Predict COVID Business Trends)
      • Necessities – Frozen went up 23%
      • Comfort foods with value went up 48%
        • Bulk foods
        • Pot Pies, sides, and ready-made meals
      • Luxury Brand market shrinks, so the messaging for this category tends to get quieter during a recession.
        • If you have a premium product you need to know your audience.
          • Premium beef went up
            o Made at home instead of eating out, so it wasn’t asobvious when spending
      • Simple Indulgences up – Alcohol, chocolate, CBD, marijuana
      • Supplements went up – Also went up during COVID
        • Protein powder has gone up 31% in the last two months during COVID
        • Huge spike in immunity supplement sales (zinc, Vitamin C, etc.)
        • Supplement sales data, as a whole is up 36%
        • Personalized nutrients and diets (functional medicine) set to be a $4.2 Billion opportunity
          • Impacts of COVID is mostly on the elderly and those with underlying conditions such heart disease, diabetes – all diet related.
      • Federal Government Bailed Out Those “Too Big to Fail”
        • Government doesn’t want to be perceived this way again
        • Helping more small businesses out during COVID instead of JPMorgan Chase size businessesTips and Next Steps
    • Pivot early and fast! – adapt your business or advise your clients to adapt their businesses to create new revenue streams, respond to current COVID trends, and prepare for the new normal post-COVID. Build resiliency into your business models now!
    • Recovery legislation is likely on the way on all levels
      • State budgets could become a big problem unless the federal government comes in to help due to their balanced budgets. Otherwise programs people rely on may not be there.
    • Start thinking about online sales marketing strategies! Watch Edible-Alpha®’s Getting Your Food Products Online Free On-Demand Course
    • Size up your competition with our Differentiation Worksheet