Clorox Sees Benefits From Retailers Cutting Brands
September 10 2009 - 2:57PM
Dow Jones News
Clorox Co. (CLX) expects to see more good than harm as retailers
trim the number of brands on their shelves with its stronger brands
picking up share as some weaker brands get pushed aside.
"We're more likely to benefit from assortment simplification
than to be hurt," Beth Springer, Clorox executive vice president of
international and natural personal care, said Thursday at the
Barclays Capital consumer conference.
Retailers have been cutting the breadth of brands they carry,
fearing that too many selections are overwhelming customers. Some
are focusing on carrying the two leading national brands plus a
cheaper private-label brand on their shelves, leaving other brands
to the wayside.
Already, its brands like Kingsford charcoal and Fresh Step cat
litter are the only brands in their category at some retailers. Its
Glad brand is the lone trash bag sold at some stores, but Glad
sandwich bags have also lost distributors as well.
Clorox expects to see more winners than losers within its
portfolio, since 88% of its products are the No. 1 or 2 in their
category.
"The observable facts will tell us we win more often than we
lose," Springer said.
Clorox Chief Financial Officer Dan Heinrich said that Clorox
expects a greater benefit from a weaker U.S. dollar in fiscal 2010
than previously anticipated, but commodity costs won't be as
favorable as initially expected.
Still, he reiterated fiscal 2010 guidance the company issued
last month, including that the company plans to see volume growth
in the latter half of the year.
Clorox shares were recently up 40 cents, or 0.7%, at $58.75, and
are up 5.7% so far in 2009.
-By Paul Ziobro, Dow Jones Newswires; 212-416-2194;
paul.ziobro@dowjones.com