US consumers resort to panic buying amid COVID-19 surge

Published: November 22,2020 12:57 PM

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November 22, 2020: As the COVID-19 situation in the US continues to escalate, consumers have once again resorted to panic buying key items again, from paper towels, disinfecting wipes and wine.

November 22, 2020: As the COVID-19 situation in the US continues to escalate, consumers have once again resorted to panic buying key items again, from paper towels, disinfecting wipes, baking mixes and wine.

Brands like Kroger, Giant, Target and other grocery chains have reinstated limits on high-demand items like paper goods and disinfecting wipes, which have created anxiety among shoppers, while grocery chains are trying to prevent hoarding to ensure there is not another round of shortages, reported Washington Post.

However, this time around, grocery chains and food manufacturers have stated they will be able to meet America's urge to hoard and keep supply chains on the move, even during the holiday season.

Retailers and manufacturers say they are less panicked about widespread shortages now that they've spent months simplifying their supply chains, adding shelves and workers to fulfillment centres, and taking other measures to counter panic-buying.

However, they have speculated that prices may rise or local or temporary shortages may occur.

"We saw a major demand spike in March and April, and we're certainly seeing another wave now as case numbers crest again across the country...This time around, it's a little bit of everything: cleaning products, toilet paper, cold and flu medicine, shelf-stable food. There's less fear than there was at the beginning of the pandemic -- people aren't as worried that stores are going to run out of toilet paper or that grocery stores will be completely empty, but they're definitely shifting their consumption habits again," says Nick Green, chief executive of Thrive Market, an online grocer that specializes in organic food and products.

He also said that the company is also buying more products directly from brands, instead of relying on third-party distributors, he said.

Other stores in the country are also engaged in increasing inventory, expanding the number of distribution centres and adopting new technology to become more efficient at anticipating consumer behaviour and managing restocking, while retailers said that the shift to online purchasing has taken the pressure off 'bricks-and-mortar stores', Washington Post reported.

"It was very scary at the beginning, but now I'm noticing that the bread aisle isn't as empty and things like toilet paper are back in stock...But stores are enforcing limits again, and you can start to see that some items, like Clorox wipes, are getting depleted again," said Raydiance Swanston, who works as an account manager for an IT firm.

Furthermore, Melanie Nuce, senior vice president for corporate development for GS1 US, a company that investigates new technologies, said that the whole food supply chain is trying to be more predictive, overcoming inventory inaccuracies and gaps in communication with artificial intelligence, smartphone-enabled bar codes and computer-connected in-store cameras to monitor stock levels.

Meanwhile, Target is stocking stores with more inventories than usual ahead of the holiday season, and has limited purchases of disinfectant wipes, cleaning sprays and disposable gloves, while Walmart's executives said shoppers have been stocking up on paper goods, cleaning supplies and shelf-stable groceries.

"It's disappointing to ... see as many out-of-stocks as we have in consumables right now, although it's a whole lot better than it was earlier in the year," said CEO Doug McMillon in a Tuesday earnings call.

According to Washington Post, while there was hoarding of inexpensive pantry items such as dried beans, flour, yeast, pasta and rice in March and April, Janet Garetto, co-leader of food and beverage for global law practice Nixon Peabody, says other food sectors could be more in demand if there are additional shelter-at-home advisories or stricter restaurant closures.

While grocery chains are confident in their ability to meet demand over the holiday season, their success also depends on smooth shipping and transportation.

Agricultural sectors are reporting a strong supply and the food which had been slated for food service before the pandemic has been repackaged or resized for retail consumers.

Despite significant disruption due to COVID outbreaks in meat-processing facilities, total red meat and poultry production has been increasing and, according to the U.S. Department of Agriculture, is expected to continue to increase for the remainder of 2020 and for 2021.

Dairy, which saw huge disruptions in March and April, is strong going into the holiday season, according to IRI, a market research firm.

From row crops to speciality fruits and vegetables, the supply chain is solid, according to USDA cold storage data released October 22.

In spite of such confidence, retailers say they are beginning to see spurts of increased demand, particularly in regions where shutdowns are imminent.

Online toilet paper company Who Gives A Crap says sales in Ohio, which began a new round of curfews and business restrictions, have doubled in recent days. Company executives say they've tripled the amount of inventory in their warehouses and increased staff by 50 per cent.

According to the latest update by Johns Hopkins University, the US currently has 12,085,389 COVID-19 cases and 255,823 deaths.


US    Panic Buying    COVID-19    Surge    DY365