Tom Branna, Editorial Director04.13.22
The highest US inflation rate in 40 years has the household cleaning industry on its heels. According to data released earlier this week, the cost of living surged 8.5% during the past year. For most consumers, the biggest price increase can be traced to the fuel pump, where gas prices have jumped 48% and the cost of groceries increased 10%.
Fuel and food impact soap and dish detergent, too. The link was evident this week during a seminar sponsored by CME. Speakers from The Clorox Company, Bradford Soapworks, Croda and the American Cleaning Institute (ACI) discussed cleaning industry gains during the pandemic and the challenges that remain. ACI CEO Melissa Hockstad moderated the session, which featured Lisa Pankiewicz, The Clorox Company; Scott Tuchinsky, Croda; and Stuart Bento, Bradford Soapworks.
Opening the session, Hockstad noted that ACI was found 1926 to promote proper hand hygiene among schoolchildren. Nearly 100 years later, ACI is still trying to convince children and adults alike to wash their hands, but the Association’s scope has grown to encompass the entire cleaning product value chain. ACI more than 140 members; half of whom are finished goods providers; the rest is primarily suppliers and a small portion, distributors. Together, they represent more than 90% of US cleaning product volume, which in the US amounts to $60 billion in sales and 67,000 jobs.
In her remarks, Pankiewicz noted that Clorox is best known for home cleaning brands, but home cleaning represents just 30% of the company’s $7.3 billion in annual sales. Besides being the biggest branded bleach producer, Clorox is a leader in promoting STEM education programs around the world.
“Our future is based on digital curiosity,” said Pankiewicz. “We want folks who are hungry, curious and focused on digital.”
Tuchinsky noted that Croda is focused on sustainable chemistry. The company’s tagline is: “Smart science to improve lives.” He said Croda is determined to be climate, land and people positive by 2030. Croda’s goal is to be the most sustainable supplier of innovative ingredients.
Bradford Soapworks manufactures private label cleansers, hair care and body care formulas for brand builders around the world. The company’s zero-waste philosophy has enabled it donate enough soap scraps to make two million bar soaps. Furthermore, Bradford Soapworks is a member of The Rainforest Alliance; 60% of its palm oil comes from RSPO-certified plantations.
But no matter where on the supply chain they reside, every company was impacted by the pandemic.
“The past two years have been a rollercoaster,” said Hockstad. “What did you learn from the pandemic?”
Benton noted that companies with a strong scientific message succeeded during covid.
“If you didn’t have a ‘why’ or a ‘purpose’ you were less successful,” recalled Benton. “Consumers wanted to know what a company stood for during the pandemic. Shoppers also increased their awareness of sustainability.”
Pankiewicz agreed that, at the end of the day, consumers went with brands they trusted.
“We’re synonymous with disinfecting wipes. We had to manage a 500% increase in production during the pandemic,” she recalled. “We became more flexible. The pandemic didn’t change what we do, but it drastically changed how we do it.”
Pankiewicz used the word resilient to describe Clorox during the pandemic. Tuchinsky used the same word to describe Croda, too.
“We adapted and embraced changes in the work environment,” he recalled. “We learned that technology can be implemented in multiple sites.”
Now, as supply chains remain stretched and inflation soars, Croda is relying on local sourcing.
Benton agreed that supply chain woes remain. A lack of truckers caused headaches last year and into 2022. Now, soaring raw material costs are further complicating issues. Bradford saponifies raw oils to make soap noodles and bar soaps. Tallow comes primarily from the US, but oils are sourced from around the world. Ingredients continue to be in short supply; so short, in fact, that there are days when Bradford cannot product products.
“I’m hoping supply chain problems ease in the next six or seven months, but trucker shortages remain,” he said.
Moreover, Bradford made major capital investments in 2021. The problem is that the equipment remains in Asia and Europe.
“We need more US suppliers who make the type of machinery we use,” said Benton.
Tuchinsky agreed that a shortage of truckers is impacting customer service. Adding to those woes, are new maritime regulations that Tuchinsky predicts will slow the pace of sea freight. At the same time, the war in Ukraine is having an impact on raw material prices. Ukraine is an exporter of corn, wheat and sunflower oils—all three have an impact on palm derivatives. As a result, he expects rising raw material costs to last for at least another quarter or two.
“Supply chains are built on just-in-time efficiency. During the past two years we’ve challenged that. We need a lot of things more quickly,” noted Pankiewicz. “We’ve flipped the concept on its head. What impact it will have on the future is an interesting question.”
Inflation has flipped consumers’ savings upside-down, too. Benton noted that during the pandemic, consumers couldn’t spend like they were accustomed.
“Two years ago, savings account balances were at their highest level; now they are at their lowest,” he explained. “I think that we are 12 months away from normalcy.”
Yet, despite economic woes and uncertainty, consumer interest in sustainable solutions remains high.
“Consumers buy from purpose-led companies,” insisted Tuchinsky. “Covid made people more aware of sustainability.”
He cited one study that found 55% of shoppers are concerned about the impact their beauty products have on the environment.
“Some consumers are trying to consolidate spending around environmentally-good products,” he noted. “That trend will continue. The younger generations will keep it going.”
Fuel and food impact soap and dish detergent, too. The link was evident this week during a seminar sponsored by CME. Speakers from The Clorox Company, Bradford Soapworks, Croda and the American Cleaning Institute (ACI) discussed cleaning industry gains during the pandemic and the challenges that remain. ACI CEO Melissa Hockstad moderated the session, which featured Lisa Pankiewicz, The Clorox Company; Scott Tuchinsky, Croda; and Stuart Bento, Bradford Soapworks.
Opening the session, Hockstad noted that ACI was found 1926 to promote proper hand hygiene among schoolchildren. Nearly 100 years later, ACI is still trying to convince children and adults alike to wash their hands, but the Association’s scope has grown to encompass the entire cleaning product value chain. ACI more than 140 members; half of whom are finished goods providers; the rest is primarily suppliers and a small portion, distributors. Together, they represent more than 90% of US cleaning product volume, which in the US amounts to $60 billion in sales and 67,000 jobs.
Doing Well by Doing Good
In her remarks, Pankiewicz noted that Clorox is best known for home cleaning brands, but home cleaning represents just 30% of the company’s $7.3 billion in annual sales. Besides being the biggest branded bleach producer, Clorox is a leader in promoting STEM education programs around the world.
“Our future is based on digital curiosity,” said Pankiewicz. “We want folks who are hungry, curious and focused on digital.”
Tuchinsky noted that Croda is focused on sustainable chemistry. The company’s tagline is: “Smart science to improve lives.” He said Croda is determined to be climate, land and people positive by 2030. Croda’s goal is to be the most sustainable supplier of innovative ingredients.
Bradford Soapworks manufactures private label cleansers, hair care and body care formulas for brand builders around the world. The company’s zero-waste philosophy has enabled it donate enough soap scraps to make two million bar soaps. Furthermore, Bradford Soapworks is a member of The Rainforest Alliance; 60% of its palm oil comes from RSPO-certified plantations.
But no matter where on the supply chain they reside, every company was impacted by the pandemic.
“The past two years have been a rollercoaster,” said Hockstad. “What did you learn from the pandemic?”
Benton noted that companies with a strong scientific message succeeded during covid.
“If you didn’t have a ‘why’ or a ‘purpose’ you were less successful,” recalled Benton. “Consumers wanted to know what a company stood for during the pandemic. Shoppers also increased their awareness of sustainability.”
Pankiewicz agreed that, at the end of the day, consumers went with brands they trusted.
“We’re synonymous with disinfecting wipes. We had to manage a 500% increase in production during the pandemic,” she recalled. “We became more flexible. The pandemic didn’t change what we do, but it drastically changed how we do it.”
Pankiewicz used the word resilient to describe Clorox during the pandemic. Tuchinsky used the same word to describe Croda, too.
“We adapted and embraced changes in the work environment,” he recalled. “We learned that technology can be implemented in multiple sites.”
Now, as supply chains remain stretched and inflation soars, Croda is relying on local sourcing.
Supply Shortages
Benton agreed that supply chain woes remain. A lack of truckers caused headaches last year and into 2022. Now, soaring raw material costs are further complicating issues. Bradford saponifies raw oils to make soap noodles and bar soaps. Tallow comes primarily from the US, but oils are sourced from around the world. Ingredients continue to be in short supply; so short, in fact, that there are days when Bradford cannot product products.“I’m hoping supply chain problems ease in the next six or seven months, but trucker shortages remain,” he said.
Moreover, Bradford made major capital investments in 2021. The problem is that the equipment remains in Asia and Europe.
“We need more US suppliers who make the type of machinery we use,” said Benton.
Tuchinsky agreed that a shortage of truckers is impacting customer service. Adding to those woes, are new maritime regulations that Tuchinsky predicts will slow the pace of sea freight. At the same time, the war in Ukraine is having an impact on raw material prices. Ukraine is an exporter of corn, wheat and sunflower oils—all three have an impact on palm derivatives. As a result, he expects rising raw material costs to last for at least another quarter or two.
“Supply chains are built on just-in-time efficiency. During the past two years we’ve challenged that. We need a lot of things more quickly,” noted Pankiewicz. “We’ve flipped the concept on its head. What impact it will have on the future is an interesting question.”
Inflation has flipped consumers’ savings upside-down, too. Benton noted that during the pandemic, consumers couldn’t spend like they were accustomed.
“Two years ago, savings account balances were at their highest level; now they are at their lowest,” he explained. “I think that we are 12 months away from normalcy.”
Yet, despite economic woes and uncertainty, consumer interest in sustainable solutions remains high.
“Consumers buy from purpose-led companies,” insisted Tuchinsky. “Covid made people more aware of sustainability.”
He cited one study that found 55% of shoppers are concerned about the impact their beauty products have on the environment.
“Some consumers are trying to consolidate spending around environmentally-good products,” he noted. “That trend will continue. The younger generations will keep it going.”