The cost of doing business is going to have an impact on Americans' wallets, at least that's according to a recent report from CNBC, which indicated several large food and beverage companies plan to raise their prices in the near future to offset commodity costs. The increased cost of commodities to manufacturer products exists in concert with last week's news that CPG sales were op 9.4% during the pandemic.
Last Monday, Coca-Cola CEO James Quincy told CNBC it would raise prices on its drinks to combat the impact of higher commodity costs. Quincey did not reveal which products would have higher price tags.
CPG companies raising prices isn't new, even during the coronavirus pandemic. J.M. Smucker raised the price of its Jif peanut butter last August due to falling peanut yields.
“In this case, and particularly in peanut butter, it was very clear that we were experiencing cost pressure and could demonstrate that to our trading partners and so forth,” CEO Mark Smucker told analysts in November.
During a March 24 earnings call, General Mills CFO Kofi Bruce said the company plans to raise prices.
In the CNBC report, analyst Phil Lempert indicated numerous factors have led to the increased costs, including agriculture, logistics & transportation, as well as workforce issues.
