Annual BCG/IRI Study Highlights Role of Acquisition, Innovation, Surgical Pricing, eCommerce, and Consumer-Trend Fulfillment in Fueling Short- to Mid-Term Growth

The US consumer packaged goods industry increased by 2.2% in 2019, outpacing 2018 growth of 2.0%, according to the eighth annual Boston Consulting Group (BCG)/IRI CPG study released at the end of March. The growth was driven exclusively by pricing adjustments in the face of declining average volumes across measured channels. Despite the volume drop, top growth leaders saw their volumes increase over 2018.

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The growth leader among large companies was Constellation Brands, which led the category for the third year in a row. Johnson & Johnson, Tyson, General Foods, and Proctor & Gamble rounded out the top five large companies—all of which, except for P&G, saw sales volumes increases in 2019. Leading mid-size companies include VPX, maker of the sports drink Bang, and e-cigarette maker Juul. Leading small CPG companies include e-cigarette maker NJOY and sports drink company BodyArmor.

The study also noted that private label and small consumer packaged goods companies continue to increase their share of the CPG market. In fact, since 2014 approximately $19 billion in industry sales have shifted from large and mid-size to private label. At the same time, private label volume has dropped 1.5% while volume among mid to large companies is on the rise after a slowdown in 2018. Regardless of size, all CPG companies are honing their sales and marketing tools to prepare themselves for continued growth in the face—and the aftermath—of the coronavirus pandemic. The study compared sales at more than 430 consumer packaged goods companies with more than $100 million in 2019 sales.

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“Over the past five years, a mix of acquisitions and portfolio shaping has driven growth among both large and small CPG companies,” says BCG managing director and partner Aman Gupta. “Acquisitions made by Tyson in the past five years account for 85% of its 2019 growth and 53% of its overall portfolio. While CPG companies are using a variety of tools to sustain growth, interest in acquisition seems to be on the rise even among smaller players.”

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