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Household Products Present an Opening for Agile Suppliers

The changing habits of people shopping for  household products  indicate that small businesses need to find a way to differentiate themselves.

About 70 percent of consumers say they now shop for home cleaning products, kitchenware and paper products based on price alone, and half say they will spend less on these products in the coming year, according to a study released by AlixPartners LLP, a global business-advisory firm.

The implication is that small suppliers, who may find it tough to compete on price, should shift their focus to products that offer consumers something more than just the basics.

“For small companies there’s an opportunity to come to market with a product that’s a little different than the competitors' and provides a lot of value at very attractive price points,” said John Fuller, a director at AlixPartners’ Consumer Product Practice. “They should find a way to position themselves between national brands and private labels.”

Based on a consumer survey of 1,000 Americans, AlixPartners also found that private-label brands, which already have made big inroads into kitchenware, could be poised to take more share in home cleaning products and  paper products as well. Roughly half of those polled saw no difference in quality between private-label and established national brands. In addition, the survey suggested that nearly 65 percent of consumers underestimate the actual price difference between private-label and national household-products brands.

For small companies nimble enough to react to the changing attitudes, getting products on shelf at large retailers remains a big challenge, Fuller told BusinessNewsDaily. However, retailers are increasingly looking to broaden their product offering — a reversal of the stock-keeping unit (SKU) trend of the last few years, Fuller said.

Jeanette Mulvey
Jeanette Mulvey

Jeanette has been writing about business for more than 20 years. She has written about every kind of entrepreneur from hardware store owners to fashion designers. Previously she was a manager of internal communications for Home Depot. Her journalism career began in local newspapers. She has a degree in American Studies from Rutgers University. Follow her on Twitter @jeanettebnd.