Private label tissue will soon own one-third of a market once dominated by name brands. What’s fueling the change? What’s next for tissue converters? Learn more in this brief video.
I’m Pete Augustine, President of Fabio Perini North America base in Green Bay, Wisconsin. I want to talk with you briefly about some changes occurring in the North American tissue market specifically along the lines of private label versus branded products. As a global company, Fabio Perini has a view of the world market and how it changes on a daily basis.
Our counterparts in Europe have watched for years as the trend changed from branded products to private label products. Europe is currently the inverse of the North American market, where the majority of the products are private label just a handful, maybe 20–30% remain branded. This is a trend we see coming to the U.S. and it’s coming quickly. NA has always been a brand-dominated market, but that’s changing very rapidly.
Today, the top three national producers may still retain over 70% of the market share of branded products but there are a few key things that are changing:
The Premiumization of Private Label ProductsWe see today that the quality private label products offer is actually better than what most people were used to 5–10 years ago. Use of structured base sheets creates products that are of equal or sometimes greater value than their branded counterparts.
Change in DemographicsThe change in demographics is definitely playing into people’s buying habits. A different generation of consumers has different preferences and the brand loyalty that folks were used to 10–15 years ago is eroding very quickly.
There are three things North American converters should be aware of:
- European discounters such as Aldi are rapidly increasing their presence here in the United States. They aim to provide a high-quality private-label experience for their consumers at the best price possible. This will force other tissue manufacturers to compete with their own high-quality private label offerings.
- Online retailers such as Amazon are going to continue to challenge the private label market. The number of consumers shifting to online shopping continues to grow and is showing no signs of slowing down.
- Converters need to be flexible to meet the demands of their customers. This requires modern equipment that is easy to operate and efficient to change over from product to product.
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