We are hosting our monthly Restaurants & Consumer Staples Q&A call on July 6th at 10 AM ET. Send us your questions ahead of time, and we will address them live. CLICK HERE for the live webcast.
A new Oatly drink blend in the future? (OTLY)
To date, Oatly has been granted six U.S. patents. The earliest patent dates back to 1994 for “a method of preparing a homogeneous and stable cereal suspension.” That patent has now expired. The most recently granted patent # 9,743,684 relates to “a process for preparing a liquid oat base or drink of improved soluble oat protein content from an oats material comprising starch and oat protein.” There is more to the process than just the patent, as Oatly’s own difficulties ramping production at new facilities shows. In addition, Oatly has other patents that are pending. Two pending patents are for the use of vegetable protein isolate (pea, potato, faba bean, chickpea, or lentil protein isolate). Will we see a new Oatly product utilizing potato or vegetable protein? A mixture of “deamidated oat base and vegetable protein isolate” may enhance the drink’s protein content and stay ahead of the competition.
Returning to the office in the fall (KR)
According to Kastle Systems, its 10 cities average occupancy rate for office buildings was 32.0% for the week ended June 23rd. That was down slightly from 32.1% the previous week as seen in the following chart. Kastle’s occupancy barometer reflects access swipes to the office; it provides control systems. Kastle has customers in more than 2,600 buildings in 138 cities. Of the ten largest cities Austin, Dallas, and Houston had the largest improvements in recent weeks. The smallest improvements in the past month were in the California cities – San Francisco, San Jose, and Los Angeles. The Texas cities have seen occupancy improve on average by 4.6% points in the past month compared to the 2.1% points improvement in the California cities.
According to a LaSalle Network survey of more than 350 CEOs and human resource professionals, 70% said they plan to have employees back in the office by the fall or sooner. A McKinsey survey said that 9 out of 10 organizations would be combining in-person and remote working. An increasing number of employees have grown to like remote working and appear to be taking advantage of the improving job market by switching to jobs that allow remote working. According to the Labor Department, in April, the share of U.S. workers leaving their jobs was 2.7%, the highest since 2000, up from 1.6% a year earlier. The return to the office will determine how permanent the food consumption shift from on-premise to off-premise. Many companies have begun announcing plans to return to the office. However, the return so far has been at a modest pace. The headwind for grocers is lessened currently, but it will stretch into late 2022 at the earliest.
Another Reyes acquisition (STZ)
Reyes Beer Division, the largest beer wholesaler in the U.S., reached an agreement to acquire G&G Distributors. G&G Distributors is based in Centreville, Maryland. The acquisition will add 700,000 case equivalents and 400 retailers to Reyes Beer Division’s existing 4 million case/2,000 retailers business in Maryland. G&G Distributors carries Molson Coors, Constellation Brands, Boston Beer, Yuengling, Heineken, and Pabst.
Reyes Beer Division has been very acquisitive in recent years, with most of the acquisitions in California. The last “east” acquisition was December 2020, when the wholesaler purchased an Indianapolis-based distributor. Reyes has been an important partner for Constellation Brands as it recognized how to capitalize on Corona and Modelo’s higher velocity. Even though G&G already distributed Constellation Brands’ beer, we expect its sales growth to accelerate under Reyes’ ownership.
