A simple visual demonstrates a critical truth for middle market consumer products companies that will be even more critical in the wake of the pandemic, particularly if the economy enters a prolonged period of deflation. Costs among the different sectors within the consumer ecosystem can diverge sharply from the overall macroeconomic trend.
The retail food space is one example. Many RSM clients have reported that inflation has been, and continues to be top of mind for them. The data supports what we’ve heard. Throughout the pandemic, the cost of food at home has been the mirror image of the Consumer Price index.