Tim Smith

Over the last couple of days, the food world has been abuzz about the long-anticipated sale by General Mills of the Yoplait brand and its assets. Many have talked about Yoplait's slow entry into the emerging Greek yogurt segment, slower growth and lower margins of the U.S. yogurt category, and the relatively low price-to-sales ratio. that General Mills received in the deal - probably warranted based on where the business is today But I wanted to address the transaction as someone who worked in Yoplait twice during my time at General Mills; I spent about 6 of my 13 years at the company in that division over two stints from 1998-2002 and 2008-2010 as an assistant marketing manager, marketing manager, and marketing director. For all of the issues Yoplait has had in the past decade, in the early part of this century, Yoplait was THE place to be in General Mills. Yogurt was the category for health, innovation, and significant growth. But it was also a great place to work because of the culture - and that's not intended as a yogurt pun! Within Yoplait there was a different vibe - there was more continuity of leaders in the functional areas, there was a tight-knit small company feel, there was a close connection to the plants, there was a global perspective through the Sodial relationship, and there was an amazing understanding of the consumer. One of my most rewarding special projects at General Mills was being tasked by Ian Friendly in 2002 to create a video on the history of Yoplait as part of the 25th anniversary celebration (for General Mills licensing the brand). I got to interview and film past presidents of Yoplait and learn about the growth of what was at the time one of the most successful startups cultivated by General Mills. One resounding theme from everyone I spoke with was the importance of creating and cultivating a strong culture in the business. That is something that has stuck with me throughout my career as I have gone to lead two organizations as a CEO. I am strong believer that you can drive strong results for a year or two, but to truly have sustained excellent results on a business it comes from building a strong culture that everyone buys into and it starts with leadership. I can't speak to the last 14 years in Yoplait, but I am grateful to the leaders in Yoplait during my time there who were very focused on the culture that drove sustained success for many years and provided me with many of my best career lessons. https://lnkd.in/g-ZddHJe.

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Inflation might still be lingering, but consumers are becoming more optimistic.That’s according to data from the University of Michigan last month, which shows that consumer sentiment improved from 70.5 points in October to 71.8 points in November.Shoppers were also splurging more during the Thanksgiving holiday. Total food and beverage sales in Circana’s MULO+ outlets, the expanded data set of marketing research firm Circana, increased 12.4% year over year during Thanksgiving week and 3.7% for the month of November. https://lnkd.in/g_ikNuu7

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This is interesting US BEER IRI grocery sell thru data from last 26wks Sept 2024 comparing alcoholic beer sell thru vs non-alcoholic beer sell thru where non-alc beer has ~73% slower velocity vs alc beer. Strange that non-alc beer the top 10-50% of beers is only 0.3 units slower vs the top 10% segment(this differs a lot from alc beer which has a 6.8 unit difference). I'm curious if this can mean that there isn't really one dominant non-alc beer SKU on shelf, but the consumer is being promiscuous in buying a few different non alcs brands and/or variety of SKUs when they fill their cart. Anyone else have any ideas on this? NOTE units could be anything from a 24ct case, 12pk, 6pk, 4pk, or even a single unit so need to make some assumptions where for non-alc beer the typical retail format is a 6pk or 12pk so the top 10% sales velocity is 3.3 units/week could equate to 20-40 cans/bottles per week. Either way some interesting data to benchmark your sales off prem.

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After spiking during the pandemic, profit margins and same-store sales growth have fallen back to pre-pandemic levels for the grocery industry, FMI — The Food Industry Association said in a report released last week. Only 38% of surveyed food retailers said they expect their same-store sales to grow in 2024 while just 13% predict net profits will increase, according to the trade group’s The Food Retailing Industry Speaks 2024 report. Food retailers are focusing on improving cost controls and cutting unnecessary expenses that do not drive value, FMI found. In 2023, profit margins in the grocery industry hit 1.6% — the lowest level since it was 1% in 2019 — as total expenses increased, FMI found. The industry’s slowed same-store sales growth of 2.1% last year was driven by inflation.

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A double earnings/sales beat, raised guidance in many meaningful categories, and new product new news for CAVA makes for a great quarter. In fact, very few other brands--only a handful-- are doing as well. A new brand regarded as cool by guests and employees and the right kind of executive management and food has been evident for years now. The IPO seems to have supercharged attention and momentum. The discussion about the calendar adjusted SSS and traffic and the two year stacked SSS number warrants a note. While the 10Q P&L necessarily focuses on change from prior year, we are almost certainly wrong focusing on that number. We as an industry can and must spend more time on 2 year and even five year stacked numbers for better MD&A. CAVA did today. Their disclosure changed the tone. Thank you Brett Schulman.

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Roundup of All Things CPG This Week: (Follow for weekly roundups like these every Friday) 💼 Mergers & Acquisitions → Kirin Completes Fancl Buyout: Kirin finalizes the purchase of Fancl for $1.4B, continuing its strategic shift from beer (WSJ). → Newport Craft Distilling Acquires KEEL Vodka: Newport Craft adds KEEL Vodka to its portfolio (PR Newswire). → Walmart Acquires Vizio: Walmart buys Vizio for $2.3B, expanding into electronics (Intellizence). → Paramount Global Merges with Skydance: Paramount Global partners with Skydance in a $22.26B deal (Inside Arbitrage). 💰 Fundraising Highlights → Funding for UK’s Common Beverage: Secures six-figure investment led by James Watt (The Drinks Business). → InvestBev’s Ambitious Goal: Launches its fifth fund, aiming to raise $150M for beverage brands (Axios). → Emma Watson’s Renais Gin: Raises $2.3M to fuel growth in the luxury gin market (SEC). → ZeroFox Holdings Raises Funds: Secures investment from Haveli Investments to enhance digital risk protection services (Stock Analysis). → Agiliti Secures Funding: Thomas H. Lee Partners invest in Agiliti for growth in medical equipment services (Stock Analysis). 💄 Apparel, Cosmetics, and Wellness Updates → Briogeo Expands Product Line: Introduces new hair styling products at Ulta and Sephora (Glossy). → Unilever Prestige CEO Resigns: Vasiliki Petrou resigns to start a new investment fund (Business of Fashion). → Care/of Closes Operations: The personalized vitamin brand shuts down (Twitter). → Goop Launches Mascara: Gwyneth Paltrow’s brand expands its makeup line with a new mascara (WWD). → GlaxoSmithKline Acquires Aiolos Bio: GSK enhances its respiratory care portfolio (Stock Analysis). → Amgen Launches New Wellness Initiative: Focuses on personalized health and wellness products (Inside Arbitrage). 🍽️ Food, Beverage, and Alcohol News → Liquid Death’s New “Death Dust”: Enhanced flavors now available on Amazon (Instagram). → SCiFi Foods Shuts Down: Cultivated meat startup ceases operations after raising $40M (AgFunder). → DAVIDsTEA Introduces Sparkling Iced Teas: Launches its first ready-to-drink product (Instagram). → Mondelez Collaborates with Lotus Bakeries: New cookie and chocolate products in the works (Food Dive). → Top of the Mornin’ Coffee’s New Flavor: Introduces French Toast Flavored Coffee (Instagram). → Hulk Hogan’s Beer Launch: Debuts Real American Beer (Brewbound). 📊 Data and Distribution Developments → MERIT’s Financial Success: On track to reach $100M in sales this year (Business of Fashion). → Verb Energy Debuts at Earth Fare: Available in Earth Fare stores. → Burnt Faith Brandy at Tesco: Expands to the UK market. → Pioneer Natural Resources Partners with ExxonMobil: Focuses on sustainable energy solutions (Stock Analysis). → Alpine Immune Sciences Teams with Vertex: Enhances its immunotherapy offerings (Stock Analysis). Enjoyed this? Follow James Ball for roundups every Friday.

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INSIGHTS Express   Vol 26, No 243  Nov 22, 2024                         The Curious Case of Continued Craft Growth in NAs Amidst Context of Overall Craft Beer Struggles One of the most striking features in the continued rapid growth of the non-alcoholic beer segment is that growth continues to be largely led by craft NA brands. That’s at the same time that the craft beer segment overall is going through one of its roughest-ever periods. INSIGHTS has noted this phenomenon before, but it’s continuing as NAs get bigger and craft gets smaller. It starts with Athletic, of course. Athletic remains biggest success story in NAs and will be close to a top 10 craft brewer of any kind in 2024. Athletic $$ sales up 53% yr-to-date thru Nov 3 in NIQ data and it has grown 3.6 share of NA $$ to 19.2. It is the biggest brand family in NA. Heineken 0.0 is #2 at 17 share, with $$ up a still solid 7.7%. Yet Athletic is #3 among NA brewers as AB overall still has 28 share. AB NA $$ sales grew 3.2%, tho it lost 6.1 share yr-to-date. (AB used to have over half the NA mkt.) Heineken USA has 17.7 share, tho it lost nearly 3 share YTD. So top 3 are about 65 share of NAs. 

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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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The non-alcoholic drinks market continues to grow and grow (and mature). Check out recent insights + stats from our friends at Grüvi: March Off Premise Retail Sales: → $48.6M > Identical to February, up 23% YoY → You can see subcategory performance in the chart below. Gruvi predicts: → 30-35% of YoY NA category growth. → 25%+ in off-prem and 50%+ in on-prem. → Premium, high quality craft or import NA beers will capture most of the growth of the NA beer market. → Big bet on NA RTDs to surpass NA wines by end of year. Gruvi has some more great stats in their blog post (link in comments). I’m hearing this same type of growth from members of the Adult Non-Alcoholic Beverage Association (ANBA). There's been some questioning about the growth of the category because of the recent Chapter 11 bankruptcy by non-alc beverage retailer Boisson and the closing of their retail locations. I was going to share some thoughts on this but the Gruvi team summed it up well: “Having served as a supply partner for Boisson, and being intimately familiar with their retail locations, it became apparent that they faced challenges across their retail and e-commerce channels. Boisson positioned itself as the upscale destination for NA beverages, boasting premium locations and a curated assortment. However, despite the overall growth in the NA market, it remains predominantly composed of NA beer (80%) and NA wines/RTDs under $12 (10%). As larger retailers expanded their NA offerings to target the mainstream consumer—the 90% of the market as seen above - Boisson was left with a small addressable market. Unfortunately, the demand proved insufficient for Boisson to sustain its operations.” Andrea Hernández also has a great take on it in her most recent Snaxshot (link in the comments). The adult NA category is maturing. Brands that do not have good business models, have bad product-market, or average quality products will need to adapt or close their doors. And this is not a bad thing. Because what rises out of this are business and products that better serve the consumer. I’m always impressed by the continued release of higher and higher quality NA products, with each raising the bar for the category. And this is great for people looking to moderate or not drink alcohol for whatever reason, and in whatever situation that best suits them. The adult NA category is getting bigger and better each day. And ANBA, our members, and I are here to continue to create a world where everyone has access to great tasting adult non-alcoholic beverages to enjoy in every social situation. And that is something we can all celebrate! 🍾 🥂 🍻 You can join us in growing the category and this movement by visiting ANBA's website and signing up for a soon to launch newsletter (link in comments). And you can follow me, Marcos Salazar 🍺🍷🥃, (& click the bell under my profile banner) to get regular insights and news about NA drinks. ♻️ #Repost if you like this post :-)

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Interesting flavor stats coming out of Spiceology and Circana. >> Chicago-based Circana recently published a new report that found Hispanic consumers drive 16% of total consumer packaged goods (CPG) growth in the United States. >> “Hispanic households are crucial drivers of CPG growth, accounting for 14% of U.S. households while delivering 16% of total growth,” said Sally Lyons Wyatt, global executive vice president and chief advisor, Circana.  >> “The Hispanic consumer continues to outpace the overall market in key categories across general merchandise as well, driving growth,” said Marshal Cohen, chief retail advisor, Circana.

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Even though a quarter of the restaurants on this year’s Top 100 Independents list saw sales declines over the previous year, these resilient operators implemented some crafty pivots. Maple & Ash - Chicago claims the #5 spot. Dive deeper to see how this segment collectively grossed nearly $2 billion in food and beverage sales in 2023 with Restaurant Business Top 100 Independents list. https://lnkd.in/g8C5-qVr

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I think food & beverage companies might be doing a poor job of navigating the narrative around gross margins with our retailer partners. The pressure is intense on the manufacturer community, but... Gross margin indexed to 2019 is expected to be at 87 (from the FCC Food and Bev report published in Grocery Biz Mag). That's a 13 point drop in 5 years. Even if well managed and well absorbed by businesses through cuts in expenses, leading to income improvement, that is an unhealthy business. Price inflation at stores has decelerated significantly, although consumers are still paying well north of 20% more than they did very few years ago for similar baskets. So, even with the price increases in the last few years, and even as consumers have absorbed that cost, the businesses in our industry are struggling to continue building the same way they were in prior years. Commercial teams need more talent, financial discipline & understanding, greater partnership skills, and just quite simply, the capacity to deal with a more difficult environment. And from an execution perspective - new game plans are a must. Running the same plan will lead to the same results; which currently looks like a deterioration of business. Test. Try. Execute well. ****************************************************************************** Maverick Sales. We are builders. FMCG. OTC. Beauty. Bricks & Mortar. Digital Commerce. Field Sales. Canada Experts. Contact us to learn more.

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The Ready-to-Drink (RTD) alcohol market is witnessing explosive growth, fueled by a shift in consumer preferences towards convenience and premiumization. Modern consumers, particularly millennials and Gen Z, are embracing these easy-to-serve options that offer quality and variety without the need for bartending skills. The surge is also supported by innovative flavors and healthier choices, such as low-calorie and organic options.

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Exciting news from Craveworthy Brands As many of you know, I love to hint at our next big moves. Some might question this approach, but I believe it’s crucial to show my commitment to pushing our team and our dreams to new heights. Our latest acquisition is a game-changer, bringing Taim and Hot Chicken Takeover into our family! This strategic move will supercharge growth for our beloved Soom Soom and The Budlong Southern Chicken providing them an extraordinary platform to thrive. Additionally, it accelerates the expansion for Sigri Indian BBQ, offering immediate opportunities for two to three new locations. We’re also setting the stage to launch Costeño Rojo, testing a few locations to refine our concept further. But it’s not just about growth—it’s about people. We’re thrilled to collaborate with the fantastic teams at Taim and Hot Chicken Takeover. Their passion and innovation are exactly what we need to reach new heights. I’m excited to see what we can achieve together with this incredible talent. Stay tuned. We’re just getting started! #CraveworthyBrands #BusinessGrowth #Acquisition #FoodIndustry #Leadership #Innovation #RestaurantBusiness #Teamwork #Entrepreneurship #BrandExpansion

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Meanwhile in CPG news... Kroger and Albertsons announced the agreement to combine in October 2022 amounting to over 4,000 stores, which would have been one of the biggest US grocery deals in history. Today, both retailers issued statements that will end the over 2-year saga. Albertsons terminated the merger and filed a lawsuit against Kroger for several breaches of the agreement including: refusing to divest necessary assets, ignoring regulators’ feedback, and rejecting stronger divestiture buyers. Kroger issued a response suggesting Albertsons had also breached the contract. #cpg #merger #food #retail #retailers

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As the demand for high-protein, on-the-go snacks continues to surge, Conagra is positioning itself at the forefront of this enduring trend. Conagra Brands, the force behind iconic names like Slim Jim and Duke's, has strategically expanded its portfolio with the acquisition of Sweetwood Smoke & Co., makers of Fatty Smoked Meat Sticks. What makes Fatty's unique? Their meat sticks boast high protein, low sugar, gluten-free ingredients, and no MSG—exactly what today's health-conscious consumers are after. Since their major 2018 acquisition of Pinnacle Foods, Conagra has been laser-focused on strengthening their core business and managing debt, keeping acquisitions on the back burner. But when the right opportunity comes along, especially a bolt-on that aligns perfectly with market trends, they were ready to act. With the meat snack market projected to grow at nearly 7% CAGR through 2033, this acquisition is a smart move for Conagra, bolstering their position in a booming segment. At Greenwich Capital Group LLC, we anticipate a significant increase in strategic-driven M&A activity within the F&B category in the coming year, likely surpassing previous levels. Mars' recent acquisition of Kellanova underscores the growing trend of large strategic acquirers making bold moves to enhance their market presence and diversify their offerings. This acquisition is a clear signal that leading players are not just pursuing growth, but are also keenly focused on aligning with evolving consumer demands for health-conscious, innovative products. We expect to see more deals of this nature as companies seek to strengthen their positions in an increasingly competitive and dynamic market. #MergersAndAcquisitions #FoodIndustry #FoodandBeverage #ConsumerTrends #InvestmentBanking https://lnkd.in/gT4AWgMW

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Interesting read. How are you mitigating financial swings during these tumultuous times? What are your thoughts on trade and tariffs? https://lnkd.in/gYBjf5QA

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 Exposing the Dark Side of CPG Brokers: Time for Accountability I’ve seen too many small and emerging brands in the Consumer Packaged Goods (CPG) space fall prey to unscrupulous brokers. These self-proclaimed “connectors” promise vast retail distribution, big buyers, and exponential growth—yet, all too often, they deliver nothing but broken promises What Goes Wrong? Lack of Transparency: They withhold critical market insights, limiting your ability to make informed decisions. Limited Effort Post-Contract: After signing, their enthusiasm and support often evaporate, leaving small businesses stranded. No Long-Term Strategy: Instead of building sustainable relationships, these brokers opt for quick wins that rarely benefit the brand. Why It Matters For startups and small businesses, every dollar counts. Wasted resources on poor brokerage services can make or break a fledgling CPG brand. On top of that, unethical practices hurt the broader industry by eroding trust and creating barriers to entry. A Call for Accountability Ask for References: Don’t just rely on a broker’s flashy pitch. Reach out to brands they’ve represented for honest feedback. Require Transparency: Make sure every fee, deliverable, and timeline is spelled out in writing. Build a Support Network: Whether it’s through LinkedIn groups, industry forums, or fellow entrepreneurs, lean on your community to stay informed. Speak Up: If you’ve had a bad experience, share your story. Accountability starts with visibility. Join the Conversation Have you or someone you know dealt with a “bad broker” experience? What red flags do you look out for before signing a deal? Drop your insights below and let’s help each other navigate the CPG landscape more responsibly. Let’s raise our collective voice to ensure that integrity wins out and that deserving small businesses get the representation—and respect—they merit. Share this in your network: Adam Siskin Scott Glassman Russell KohnAlex Bayer Stephen Gaither Scott Lerner Eric Skae Wade Yenny Bert Cohen Chris RobbAlan Murray Maya French Shibani BalujaAdam ButlerKim Oster-HolsteinPete Maldonado

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