In an odd turn of events, the recession may be increasing sales for privately owned beverage maker Cliffstar Corp., says company CEO Paul Harder. The Dunkirk, N.Y.-based manufacturer with sales estimated at $1bn annually appears to be benefiting from more cost-conscious consumers turning toward its private-label juice, teas and sports drinks rather than brand-name products, says Harder. Sales are "slightly ahead of last year," according to Harder, who has served as CEO for two years. He says the company is positioned for long-term growth because of a shift in consumer behaviors and the company's own continuous-improvement plan.
"The private-label brand has a modestly lower cost than national brands. If you look at what the national sentiment is and how people are viewing their purchases these days, you're seeing a shift away from conspicuous consumption--people who are not willing to accept lower value but don't want to be conspicuous about what they're buying," Harder says. Wal-Mart, for instance, plans to increase its stock of private-label brands from 20 percent to 40 percent, says Harder.
In addition to changing buying habits, the company is taking proactive steps to reduce costs and increase productivity. One of its more recent continuous-improvement efforts features an employee incentive program.
Source: Industry Week