People are looking at their garbage differently these days, and that's making the environment for selling trash bags stormier than ever.
Supermarket retailers across the nation are watching as their category sales and assortments get pushed or pulled in different directions in the wake of new mandatory recycling rules imposed by an increasing number of municipalities.
That's not all. The category also is
being tossed and turned by more intense price competition between suppliers, who are turning on the heat with more prepricing and advertising.
Counting those other trades as well as supermarkets, national sales for the category have been flat, according to Information Resources Inc., Chicago. For the 52-week period ended May 22, 1994, plastic garbage and trash bag sales in food, drug and mass merchandiser stores totaled $922 million, an increase of 0.8% over the previous 52-week period.
However, below the national surface, retailers are seeing more dramatic swings within the category, depending on the local regulatory climate for refuse disposal. Some buyers told SN that total category sales are being hurt, while others said the laws are helping them to maintain, and in some cases even expand, their overall trash bag volume.
"More and more municipalities are demanding that their residents bag the trash, and that has helped increase sales," said Ron Little, space allocation manager at Metro/Basics, Randallstown, Md.
Little said one section of Baltimore has required that residents place recyclables in bright blue bags. To meet the needs of the community, Metro/Basics stocks a blue Glad bag in its stores in that area.
"That ordinance has created a whole new market for that particular type bag, and I suspect eventually it will be in all areas of the city.
"The blue Glad bag is selling well in the areas that require it, and we may try it in a store or two [elsewhere] to see if it picks up anything," Little said.
"People are going to the recycled bags now; more and more people are getting environmentally conscious," said Jimmy Simmons, buyer at Harvest Foods, Little Rock, Ark.
Ingles Markets, Black Mountain, N.C., has seen mixed results with the blue bags it ordered for its stores in Haywood County, N.C., which has a blue bag ordinance. Sales of blue bags were initially weak, but are expected to pick up as more people recycle, said Jimmy Jones, buyer.
"With one of our stores we special-ordered the blue bags, because the manager was having a lot of calls from his customers. We got him 10 or 15 cases, but we expect it is going to be a slow-moving item and it is not going to set the woods on fire," he said.
The Omaha, Neb., market saw an upheaval in its plastic bag market when a city ordinance was passed effective April 1, according to Bill Loneman, director of grocery marketing and merchandising at Baker's Supermarkets there. The ordinance required all yard waste to be placed in brown paper bags so it could be composted, and any trash that was not inside a container had to be placed in a clear plastic bag.
Baker's switched over its entire Glad line from opaque to clear, while maintaining dark colors in Hefty and Ruffies bags. The slowest moving stockkeeping units were discontinued to make room for the paper sacks.
"We were really fortunate at Baker's to break with the first paper and clear plastic bag ad. We broke with that March 23 and we had exceptional sales. Some of our competition didn't even have the clear bags yet. So we won that one, but we lost when our suppliers couldn't keep up with product later on in the month," he said.
"We saw a fundamental change in what was selling immediately. Our one SKU of Yard Master paper sack became our No. 1-selling item, followed closely by clear tall kitchen, clear trash and clear lawn and leaf from Glad. Glad really benefited from the change to clear bags," Loneman said.
Unfortunately, Omaha's mayor KO'd the program because the local trash-hauling company could not keep up with the collection. Local officials hope to implement a new recycling program later this year.
"The paper bags are much more expensive than the plastic bags, and that brought a public outcry from the consumers," he said.
Other retailers also see recycling laws causing a pain in the can for plastic trash bag sales.
"We have a lot of recycling in our area, which I think hinders sales. In some households about 30% of the garbage goes into the recycling bin, so that has to be slowing down trash bag sales," said Rick Van Klaveren, buyer at Harding's Market West, Plainwell, Mich.
"You can't make people become ecology minded; in my opinion they are going to do it or they are not. We're slowly but surely getting people to think that way, but it is going to be a long, hard process, and maybe [more] laws will have to be passed to make people recycle," said Jones of Ingles Markets.
John Ruhland, a buyer-merchandiser at Holiday Cos., a major Minneapolis-based wholesaler-retailer, is also finding that it takes some time for consumers to adjust to new recycling laws.
"Lawn bags are still doing surprisingly well in the spring and fall, even though here in Minnesota we cannot put yard waste in the garbage in certain communities," Ruhland said.
But one major manufacturer said the recycling rules should bode well for the trash bag industry for the long haul.
"Because of all the rules you have with recycling, people are packaging their garbage more," he said.
"It's much neater. Instead of it being bulky, it's compacted because people have to think more about their garbage. And since prepackaged garbage often weighs more, they need stronger bags," he explained.
The industry players, meanwhile, are making things more interesting on their own. Retailers said trash bags today are among the most active areas of the center store, with manufacturers competing for sales and supermarkets competing against mass merchandisers, drug stores and membership clubs.
Most retailers said the upshot is a consumer emphasis on price.
"To some degree, there is brand loyalty, depending on the style," said Robert Benner, a buyer at Haggen Inc., Bellingham, Wash. "But overall there is not a huge amount of brand loyalty and many consumers buy based off of cost," he said.
"The plastic bag market has been a very competitive one for a long time. People seem to buy whatever is on sale. It is a very price-driven category," said Ruhland of Holiday Cos.
"Glad uses a number of in-ad coupons, while Hefty has run prepriced. They compete against each other. Glad does a lot more advertising in our ad, and I suppose Hefty has a lot more street money, but the bag market is real aggressive," Ruhland said.
The move by major manufacturers to an everyday-low-pricing policy has cut into retail margins and allowances, Ruhland added.
"Out of all of the items I buy, one has over a $9 allowance on it -- which is pretty substantial. But the category is not nearly what it was a year ago when there were $4 and $5 deals all over the place. There are still deals, but it is not nearly as many items and not nearly as high because of the price declines," he said.
He added that the advertising levels from Glad and Hefty are probably keeping his private-label sales at a level less than spectacular. However, other retailers said their private-label sales are going strong, at the same time sales of prepriced national brands are burgeoning.
"Our private label is real competitive with Glad. We do a good job with the private label bags," said Simmons of Harvest Foods.
"We also have a lot of success with the prepriced bags in the 10- and 20-count sizes. The larger sizes are not that big a hitter for us," he said.
"A lot of times the people buy what's on sale, and the manufacturers are coming out with more prepriced bags now. It has become a competitive thing, with each brand having to outdo the other to get the sales. Whoever has the best prepriced for the money will get the sale," said Little of Metro/Basics.
Little said he gets a lot a advertising support from Glad, Hefty and Zeta (Renew).
Jones of Ingles Markets said, "Whatever is cheapest sells best -- whatever we promote. We have a program called a Super Saver, where we have a reduced retail with a sign on the shelf, and those items really move well for us. "We carry Glad from First Brands, Hefty from Mobil, Renew from Zeta and Webster. We also have our Laura Lynn private label and we do real well with it."
Several retailers said they have been expanding their trash bag sections.
"We're up to a 24-foot section for bags, wraps and foil. A few years ago we had 20, so we've increased it as we put up new stores. Some of the bags are so long and some of the aluminum foils are 24 inches. We like to lay our product out sideways so we won't be looking at the ends," said Little of Metro/Basics.
"We have reset our bag sections within the last few months due to the addition of many bonus packs offered by the manufacturers," said Peter Dudis, director of grocery operations at Big Y Foods, Springfield, Mass.
He said Big Y carries 30 SKUs in Glad, Hefty, Webster (BesPak), Zeta (Renew), Good Sense and private label.
"We try cover the category every week in our sales plan in order to retain our share of business from mass merchandisers and the club stores. We keep the category promotionally active," he said.
"We have seen some more competition, and to combat it we have been doing more promoting. We have been and are getting more heavily into private label. From that aspect we could see some recovery and growth in that category, based on being able to give the consumer a better buy for their money," said Benner of Haggen.