Beer lapping the stockpiling (STZ)
Off-premise beverage alcohol sales fell for the first time in more than a year as we lapped the stockpiling period last year. For the week ending March 13, off-premise alcohol sales decreased 1.9%, according to Nielsen. The beer category was the only one to grow. Off-premise beer sales grew 0.4%, driven by hard seltzer, which grew 26.4%. Core beer sales decreased 2.2%. Wine sales declined 8.1%, while spirits were flat.
Hard tea grew 44%, non-alcoholic beer grew 25%, Mexican imports grew 6.4%, other imports grew 3.8%, and domestic super premiums grew 4.2%. Sub-categories declining included premium lights down 4.2%, below premiums down 7.6%, craft down 5.2%, cider down 7.1%, and FMBs ex. hard seltzer down 0.7%. Truly’s off-premise dollar sales increased 132.2% in the four weeks ended March 13, while White Claw grew 51.3%. In the convenience store, channel beer sales grew 9.7%, while in the grocery store channel, it decreased 3.1%.
Compared to the same week in 2019, the beer category grew 17%, wine grew 19%, and spirits grew 28%, reflecting a shift from on-premise in 2021. As an indicator of what the off-premise channel would be like if the on-premise channel no longer had restrictions, Texas off-premise beer sales declined 4.9%, and in Florida, off-premise beer sales declined 5.5% for the week. Still, the comparisons are against stockpiling a year ago, and the on-premise channel in the two states is still experiencing significant traffic declines compared to pre-pandemic levels. Constellation Brands is unique in that its sales benefited from the pandemic and the shift to off-premise. Still, it has easy comparisons due to the shutdown of production in Mexico.
Grocery sales plummet against stockpiling comparisons (ACI)
For the week ended March 14 total, CPG demand fell 37% as we lapped the stockpiling early in the pandemic last year. Frozen food sales fell 39%, produce sales fell 21%, and beverage alcohol sales fell 22%, as seen in the following chart. Meat sales fell 38%, with all subcategories seeing a significant drop in demand. The worst performing in the meat sub-category was frankfurters, down 48%. Seafood was the only category to see an increase this week, up 2%.
The entire edible category fell 34%, while non-edibles fell 52%. Within non-edibles, paper products saw a 71% YOY decline while household cleaning fell 49%. This week and the next week are the most difficult comparisons of the pandemic for consumer packaged goods.
Weee! raises funds (KR)
Weee!, an online grocer focusing on Asian and Hispanic customers, raised $315M in a Series D round of financing at a $2.8B valuation. Weee! has now raised $415M in total funding, a sizable amount in a differentiated segment of the grocery market. The company was founded in 2015 with an initial focus on the Asian community, but it has recently expanded to Hispanic foods. The company considers itself an ethnic grocer and currently serves 14 regions in the U.S. The company said the investment would be used to accelerate expansion in North America.
Numerous online grocers have raised funds since the pandemic began. From the generalized grocers like Instacart, Easy Bins, and Good Eggs, there are several competitors to hyperlocal grocers like Fridge No More. There are even more niche concepts like Imperfect Foods, which focuses on surplus foods, Hive, which focuses on sustainable grocery. Thrive Market focuses on organic groceries, Dumpling, which enables personal delivery services, and Farmstead sells software to other online grocers, among others. Startups have also been raising funds internationally and have seen with Flink, Weezy, Jiffy, Crisp, BigBasket, Rohlik, and Xingsheng Youxuan recently. The industry expects online grocery to grow in 2021 despite the difficult comparisons and increasing vaccine distribution. Online grocery shopping also slowed sequentially in February. Determining the last mile solution is a challenge for all participants. The startups’ flush cash balances will keep the competitive environment intense and a margin headwind for the incumbent grocers.
