I’ve noticed lately that more and more generic store brand items I’d been buying at the supermarket (Kroger in my case) have disappeared, leaving only name brand products to choose from. First the generic Tombstone frozen pizzas disappeared, then generic Woolite detergent vanished. More recently a number of generic versions of cleaning products like Lysol, Soft Scrub, Lime Away, and in just the past month or so toilet bleach tablets have disappeared.
Is it possible that there’s more going on here than the economics simply not penciling out? Many of these particular products can be fairly expensive for what they are (the generic bleach tablets for instance were only about $2.00 but the Clorox ones are more than $5.00). It makes me wonder, do companies pay retailers to NOT carry generics of their products? It seems like it could be something of an extortion racket, but I wouldn’t be surprised to see big companies like Kroger and P&G getting into a pissing match over such things.
Google has been no help, as the search terms are too…generic
I find it the other way around. I will go to a store looking for a specific name brand, and find only generics. It’s annoying because I’ve bought the products in that store before, and now they’re gone.
This article from three and a half years ago says that generic brands are on the increase:
This Wikipedia entry says that generic brands are most popular in a recession, so perhaps just in the past three and a half years the proportion of generic brands has gone down:
Might competition from product outside of the store be a factor? For instance, maybe Kroger’s generic air freshener wasn’t losing out to Kroger-sold Lysol, but to WalMart-sold generic air freshener.
IOW, Kroger may realize that it’s not moving some generic products, and they don’t care much why – if the product doesn’t move, it doesn’t pay to get it produced and to stock it in their stores.
Actually many times the generic brand is the SAME EXACT STUFF as is in the name brand product. And manufactured by the same company. They just switch the packaging on their production lines to fill the order for generic products.
And it is just an “accounting thing” so far as pricing goes. The name brand includes the cost of the product +profit AND advertising… The generic only needs to include the cost of the product +profit.
With that said, the manufacturer could agree to just provide the name brand product to a store and set its price at the generic level. I guess all the other smaller stores would then need to pay for the advertising?
jjakucyk, are you sure the generics have been replaced? Many supermarkets now have multiple lines of store brand products, which may come in different levels of quality or differ across types of foods. Unless you’re familiar with every brand name in a store, it’s possible that the older brand lines have been switched to newer lines.
No, I’ve noticed in my local grocery too (Dillon’s, which is a Kroger subsidiary) that the Home Sense line of generic cleaning supplies have disappeared. I bought the Home Sense soap pads for years; then they showed up on the clearance rack, and now the store only has S.O.S. brand.
Meanwhile, they are expanding the Private Selection and Simple Truth food items, particularly in the frozen aisle, so I don’t think it is as simple as generic vs. brand-name.
Manufacturers pay “stocking allowances” to stores – in other words, they’re buying the shelf space for their products.
Suppose Clorox is willing to pay for three feet of shelf space to stock all its cleaners, including toilet bowl bleach tablets. But also suppose that toilet bowl bleach tablets just aren’t as popular as they used to be. It may be that the store has decided to use the space they used to have for store-brand toilet bowl bleach tablets for something else they can sell more of, and leave the entire market to Clorox, which pays the store for the shelf space no matter what product it puts there.
I bet it’s that, combined with the fact that a lot of stores are now having multiple “house” brands. So at Kroger, there are Private Selection products as the “premium” house brand, “Kroger” branded stuff in the middle, and “Value” branded stuff at the low end. Plus, there’s “Simple Truth” branded organic/natural items as well.
So you might go and look at the yogurt and see Dannon, Chobani, Private Selection and Simple Truth, and conclude there’s no house (i.e. “Kroger”) branded option, when in reality, you had 2, in the “Private Selection” and “Simple Truth” options.
And commodity items, like say… sugar ARE often the same exact items in different bags (saw that very example at the packaging room of old Imperial Sugar plant in Sugarland once upon a time) but other things with a qualitative difference may or may not be the same, even if produced by the same company. For example, house-brand dishwasher detergent isn’t the same thing- it doesn’t work quite as well in most cases. However, often multiple stores will sell the same product under their own brand, if you watch the packaging and scents. (or unfortunately, by watching product recalls).
Exactly. I know the other store brands (it’s best to avoid the “Value” branded stuff because it’s usually just smaller quantities but at a higher unit cost than the “Home Sense” lines) and many are just gone. It’s easy to tell when something like toilet bowl cleaners only have three linear feet of shelf space in total compared to, say, paper towels, which can take up half an aisle with all the different brands and packaging quantities. It’s not like the Home Sense brand is gone either. They just recently introduced their own “magic eraser” to compete with Mr. Clean. I thought at first it might be my bleach tablets because the package is the same size and looks similar. Oh well.
That’s a critical piece I wasn’t aware of, and the explanation certainly makes sense. I do still wonder if the store negotiates the stocking allowance rates based on whether they have generics or not.
I thought my dishwasher was broken but then I realized the generic detergent I bought was the culprit. I couldn’t even get it to work with half generic and half Cascade it was that bad. I really liked Kroger’s frozen pizzas, as they used a sort of flatbread crust which had a nice texture and crispness. Their peanut butter is outstanding too (maybe because they’re using real sugar and not high-fructose corn syrup?), but some of their pasta sauces are awful, loaded with salt to try to compensate for a lack of any other flavor. You just gotta try them all to find out I guess, but it seems there’s less choice than ever.
There is all types of reasons a store might decide to carry or not carry a generic.
A gallon of generic bleach might cost a dollar and sell for $2. That’s a dollar profit per. If Chlorox costs $3 and sells for $5 that’s 2 dollars profit per. If the store doesn’t have to worry about losing customers to competition and they know people aren’t going to go without bleach(big ifs), they can drop the generic and make a higher profit. Someone at corporate might have done the market research and decided that particular store should drop the generic.
Also Chlorox could come along and say we charge 3 dollars per unit if you carry competing products, if you offer us exclusivity we’ll drop the price to $2.50.
My wife used to work in a vegetable cannery, who made branded product and also generics after the regular run was done. If sales of the branded product are up, perhaps there isn’t manufacturing capacity to make somewhat less profitable generic products after the contract is up. (My Safeway still has plenty of generics.) If a company has an effective monopoly on a product perhaps they can demand prices too great for the grocery to be able to distinguish their generic from the branded product by price. Or perhaps WalMart and Costco eat up their manufacturing capacity.
I have a feeling though, that in most cases where stores don’t stock many generics, or even at all, there’s such high brand loyalty to the name brands that they just don’t sell enough of the generics to really make any money. For example, most grocery stores may carry a type or two of store-brand bar bath soap, while carrying three times that number of types of one BRAND of name-brand soap, and carrying several brands. People just prefer Dial, Irish Spring, Coast, Dove, etc… to Great Value “Fresh Scent” bar soap.
With complete computerization of grocery store checkouts, the managers now know on a daily basis exactly which items are selling faster or slower. And they are always limited by shelf space. So store managers are constantly watching their sales, and dropping items (slow-selling, low-profit, or takes up too much shelf space) and replacing them with other items. So the mix of items changes much more rapidly than it used to.
I can see this leading to decreases in stocking particular generic items, even if the overall grocery trend is toward more generic/store brand items.
Also, buyers of generics are more price-sensitive. So if they want it cheaper, they can probably save even more buying it at Wal-mart or Target. Those chains moving into the grocery business may cause other grocery stores to move from “the low-price leader” to “the friendly, personal service grocery store”, with a corresponding decrease in generics.
