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Home Care: Half-Year Update H1 2022

September 2022

Euromonitor International updated the Home Care Forecast Model in August 2022, applying the latest macroeconomic consensus to review 2022-2026 category projections. This report reviews top line changes to this outlook, indicating the main challenges faced by the home care industry, examining the impact of price inflation on category performance, and reviewing the recent reporting on industry leaders from public trading updates.

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This report comes in PPT.

Key Findings

Cost inflation is impacting home care

The home care industry is facing serious challenges related to the current supply chain crisis and the cost increases associated with it. Raw material prices have increased sharply, and with it the cost for energy and transportation. This is leading to downtrading and downsizing among consumers across fmcg industries. Home care is benefiting from a lag effect of consumption stemming from the pandemic experience and a heightened recognition of home care as a key hygiene provider.

Inflation surge as sustainability driver

Economic tensions are supporting the existing industry drive for more sustainable solutions. Industry players have come to realise that their sustainability goals can also be profitable goals. More than ever before, circularity and cutting down on resources in production and transportation are proving essential, especially as companies will not be able to pass on all costs to consumers as inflationary effects are continuing to impact the industry.

Product prices on the rise

Euromonitor’s Voice of the Industry survey reveals that 49% of businesses have responded to the ongoing inflationary pressure on their profit margins by increasing prices of some or all of their products. Those retail price increases also reflect in Euromonitor’s VIA price tracker, with frequent double-digit median price increases, comparing August 2022 with August 2021.

The industry has learnt from past events

The leading home care players, Procter & Gamble and Unilever, are reporting strong H1 2022 results, benefiting from price increases and a less-than-expected impact of those increases on demand. While the industry is counting on the lasting positive effect of the pandemic on demand, price segmentation and “shrinkflation” are commonly observed strategies used by home care players to minimise the effect of brand migration and downsizing on their brands.

 

Introduction

Scope
About this briefing
Key findings

H1 home care update

Industry-specific scenario
Largest upgrades/downgrades for home care
Forecast scenario
Updated Quarterly Forecast: home care – baseline vs quarterly update (1)
Updated Quarterly Forecast: home care – baseline vs quarterly update (2)
The many drivers of inflation within home care
Input costs significantly up

H1 HOME CARE UPDATE

Industry response to high input and production costs
Procter & Gamble fights customer migration with price segmentation
Unilever responds with dynamic pricing strategy
Key players and price inflation

Q3 macroeconomic update

Global growth outlook remains challenging, with downside risks dominating
Rising inflation continues to undermine consumer confidence
Real GDP annual growth forecasts and revisions from last quarter

About our industry forecast model

Home Care data and reporting timeline

Home Care

This is the aggregation of laundry care, dishwashing products, surface care, chlorine bleach, toilet care, polishes, air fresheners and insecticides.

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