Cash-Strapped Brits Scrimp on Soap as Consumer Cutbacks DeepenBy
Penny-pinching Britons are so concerned about the state of their finances that they’re now even saving on soap, at least according to PZ Cussons Plc.
U.K. “consumers are shopping cautiously, reflecting general cost inflation outstripping wage growth and broader economic uncertainty,” the maker of Imperial Leather, Carex and Original Source products said in a statement Tuesday. The Manchester-based company’s first-half earnings fell from last year, sending the stock down as much as 5 percent in London trading.
While declining consumer confidence and reduced discretionary spending has been flagged by numerous retailers in the wake of the U.K.’s vote to leave the European Union, the focus has been on big-ticket items like furniture and holidays. But PZ Cussons says even the washing and bathing market is now facing “tough trading conditions,” with sales volumes more sensitive to price points and discounting.
“Many consumers have a big hoard of toiletries including soap in cupboards, so it is usually possible for them to tap into this stock if they want to keep spending down,” Bloomberg Intelligence analyst Charles Allen said by email.
The slowdown in volume growth seen by U.K. supermarkets in the second half of last year amid rising prices will almost inevitably mean that sales for supermarket suppliers -- such as PZ Cussons -- suffer, he added.