Fenwick Brands Gives Consumer Packaged Goods Private Equity Insights

The meeting offered an inside look from industry experts on trends that drive shifting consumer demand and the changing mindset of the purchaser. "We are seeing changes in demographics. More singles are living alone, and the population growth is being driven by ethnic diversity," says Hill. These trends are creating a need for package innovation for individual or single servings and bringing more exposure to ethnic culture and flavors, making them mainstream.

With declining birthrates, smaller households and more working moms, there is an emergence of a new consumer – one that is demanding simplified solutions. Consumers are busier. They are looking for products to solve problems and save time. However, this demand extends beyond food – think Tide^® Pods detergent packs or Greenies™ individually wrapped dog treats. "These products are intended to make life easier, and consumers are increasingly seeking out products that cater to their on-the-go lifestyles," says Elizabeth Stewart, Director of Investments at Fenwick. "People place value in that, and therefore, will pay extra for it. "

Not only do consumers want easy solutions, but they are health-conscience now more than ever. According to Kantar Retail ShopperScape^®, 87% of all shoppers are managing their overall health and wellness in some way. This is a huge opportunity for CPG companies as there is a need in the market for better-for-you options, and people are willing to pay premium prices for these products. According to IRI data, natural and organic products make up 10% of the overall snacking category, but drive 36% of the category growth. "This gap is the opportunity that we at Fenwick recognize. Large brands are seeking accretive natural and organic expansion, but struggle to innovate in that space internally," says Stewart. "Large brands need to recapture the customer, and they can afford to pay for it. We've seen it in recent acquisitions like Dr. Pepper purchasing Bai, a line of antioxidant infused drinks and Unilever purchasing Seventh Generation, a natural cleaning line."

Technology is shaping the way the consumer shops, and millennials are leading that change. Consumers can now compare prices, download coupons, read product reviews and have a product delivered to their front door all from their smartphone. According to Data 'N Charts, the usage of grocery apps has tripled over the last three years. "People are shopping differently, and technology is driving that shift," says Melissa Baker, President and CEO of Fenwick. "We are helping our brands navigate this new space by helping them focus on in-store marketing as well as digital. The whole landscape is changing, and we help founders and brands navigate these changes."

New technology is driving the need for a multi-channel approach. "The traditional retail channels are becoming blurred," says Hill. "You can't just sell your product in a grocery store and think you're going to capture the consumer." Being accessible to the consumer through a traditional grocery store is key, but just as important are mass retailers like Walmart and Target, club stores like Costco, natural and specialty stores like Whole Foods, convenience stores, food service and e-commerce. "Having a multi-channel strategy is crucial to ensure consumers have access to your product," says Hill.

All these trends are interconnected, and it is essential to make sure a business model has the ability to win with today's consumer. Fenwick believes there is an attractive opportunity for active investors to support businesses in the underserved segment of the consumer packaged goods marketplace –between the initial startup and that brand to achieving scale. Small and mid-sized brands are gaining market share in the CPG space, and that's where Fenwick wants to put capital to work. "The opportunity gap is that these small companies oftentimes need full management teams but have limited resources. This is where Fenwick adds value," says Melissa Baker, President and CEO of Fenwick Brands. "Our team has over 100 years of combined industry expertise. We know who the consumer is, what they want and how they want it. Our operating team has worked for large industry players so we know how to scale and, more specifically, what will add the most value at exit. This dual approach is why Fenwick is able to be relevant across the entire consumer spectrum."

Founded in 1988 in Birmingham, Alabama, Fenwick Brands is a leading equity investor and operator focused on the consumer goods space. Fenwick partners have over 100 years of combined operating and management experience in the consumer packaged goods industry. Fenwick invests exclusively in consumer products companies with emerging brands who need a combination of capital, strategic and operational expertise to deliver maximum shareholder value. To learn more, visit www.fenwickbrands.com.

Founded in 1927 in Jacksonville, Florida, Acosta has grown from a local food broker to become the leading outsourced sales and marketing agency serving consumer packaged goods companies and retailers across the United States and Canada. Acosta offers a truly integrated approach that engages shoppers at every point along the path to purchase and ensures that our clients' products are strategically positioned to most effectively convert consumers in store. We also offer support services that help our clients drive innovation and achieve cost savings. Learn more about our services at www.acosta.com. 

SOURCE Fenwick Brands

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