The Consumer Products – Staples is operating in a difficult demand environment, as companies navigate a macro landscape where household budgets remain stretched and purchasing decisions are increasingly value-driven. Persistent cost-of-living challenges have reshaped consumer behavior, leading shoppers to prioritize essentials, trade down to lower-priced alternatives and scrutinize pack sizes more carefully. This shift is tempering volume growth across several categories, even as staples remain a non-discretionary part of the consumer basket.

At the same time, industry players are contending with an uneven cost environment that continues to test operational discipline. While certain commodity prices have moderated, many manufacturers still face elevated raw material and logistics costs, alongside structurally SG&A expenses. These pressures have tightened margins and pushed companies such as Procter & Gamble Company ((PG Quick QuotePG - Free Report) ), Church & Dwight Co., Inc. ((CHD Quick QuoteCHD - Free Report) ), Ollie's Bargain Outlet Holdings, Inc. ((OLLI Quick QuoteOLLI - Free Report) ) and Grocery Outlet Holding Corp. ((GO Quick QuoteGO - Free Report) ) to lean more heavily on pricing actions, productivity programs and portfolio optimization to protect profitability.

About the Industry

The Zacks Consumer Products – Staples industry includes companies that manufacture, market and distribute a broad range of everyday household and personal-use items. These offerings span personal care products, cleaning tools, stationery, bed and bath essentials and general household goods such as small appliances, cutlery and food-storage solutions. Some players also participate in categories like batteries, lighting, pet food, treats and related supplies. Their products reach consumers through supermarkets, drug and grocery chains, department stores, mass merchandisers, warehouse clubs and other retail partners, while a growing share is now sold through digital channels. Several companies also supply items to perfume, cosmetics and personal-care manufacturers, as well as to third-party distributors.

Trends Shaping the Future of the Consumer Products - Staples Industry

Rising Cost Pressures in a Difficult Operating Environment: The consumer goods industry is under pressure from rising costs in raw materials, labor and transportation. These elevated input costs weigh on profit margins, especially when companies are unable to fully offset them through price increases. Compounding the challenge are higher SG&A expenses, along with increased investments in digital transformation and marketing to drive growth. Many firms are vulnerable to shipping disruptions, which can result in delays and higher freight expenses, squeezing overall profit margins. To safeguard margins, many companies are implementing restructuring initiatives and cost-cutting strategies aimed at improving operational efficiency and sustaining profitability in this demanding environment.

Heightened Consumer Spending Volatility: The Consumer Products – Staples industry is grappling with increased spending volatility amid an uncertain macroeconomic backdrop. Shifting consumer behavior, especially among lower-income households, is being driven by rising living expenses and declining personal savings. These financial pressures are dampening purchasing power and directly impacting sales across the industry. Given the sector’s heavy reliance on middle and lower-income consumers, it remains especially vulnerable to economic headwinds that could result in softer demand, lower sales volumes and slower growth momentum.

Exposure to Currency Fluctuations: Global players in the industry remain sensitive to exchange-rate movements, with an appreciating U.S. dollar posing a notable risk. A stronger dollar can reduce international revenue contributions when translated back into U.S. currency, pressuring reported results. This exchange-rate dynamic may force companies to weigh difficult decisions around price adjustments in overseas markets or accepting tighter margins to maintain competitiveness.

Maximizing Revenues Through Strategic Optimization: Companies are actively pursuing strategic levers to strengthen their revenue base and long-term positioning. E-commerce and digital capabilities continue to expand, supporting both convenience-driven demand and higher-margin direct-to-consumer models. Innovation efforts are aligned with evolving consumer expectations for healthier formulations, environmentally responsible packaging and frictionless, tech-enabled engagement. Simultaneously, many firms are reshaping their portfolios through targeted acquisitions and divestitures, enabling a more focused allocation of capital to faster-growing, higher-return categories. Together, these initiatives are helping industry players sustain relevance and drive incremental growth in a rapidly transforming market landscape.

Zacks Industry Rank Indicates Dull Prospects

The Zacks Consumer Products – Staples industry is housed within the broader Zacks Consumer Staples sector. It currently carries a Zacks Industry Rank #183, which places it in the bottom 24% of more than 243 Zacks industries.

The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all member stocks, indicates dim near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.

The industry’s position in the bottom 50% of the Zacks-ranked industries is a result of a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are gradually becoming less confident about this group’s earnings growth potential. Since the beginning of September 2025, the consensus estimate for the industry’s current financial year earnings has decreased 1.2%.

Let’s look at the industry’s performance and current valuation.

Industry vs. Broader Market

The Zacks Consumer Products – Staples industry has lagged the S&P 500 index and the broader Zacks Consumer Staples sector over the past six months.

The industry has lost 12.2% over this period compared with the broader sector’s decline of 5.2%. Meanwhile, the S&P 500 index has advanced 18%.

Six-Month Price Performance

Industry's Current Valuation

On the basis of forward 12-month price-to-earnings (P/E), commonly used for valuing consumer staple stocks, the industry is currently trading at 18.21X compared with the S&P 500’s 23.44X and the sector’s 16.35X.

Over the past five years, the industry has traded as high as 23.40X, as low as 18.21X and at the median of 21.27X, as the chart below shows.

Price-to-Earnings Ratio (Past Five Years)

4 Consumer Product Stocks to Keep a Close Eye On

Ollie’s Bargain: Ollie’s continues to reinforce its competitive positioning through a disciplined value-driven model supported by strong merchandising execution and tight cost controls. This Zacks Rank #2 (Buy) company benefits from its loyalty program, Ollie’s Army, which remains a major strategic asset, deepening customer engagement and driving repeat traffic that strengthens the brand’s leadership in the closeout retail space. The company’s steady access to high-quality brand-name deals, paired with proactive investments in distribution and market expansion, enhances operational efficiency and future scalability. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Ollie’s current fiscal year earnings per share (EPS) has remained unchanged at $3.82 in the past 30 days. This indicates growth of 16.5% year over year. OLLI has seen its shares soar 2.9% in the past six months.

Price and Consensus: OLLI

Procter & Gamble: This Zacks Rank #3 (Hold) company continues to demonstrate durable market leadership through a world-class brand portfolio, strong innovation pipelines and superior in-market execution. Procter & Gamble is benefiting from productivity initiatives, balanced pricing and volume momentum, and healthy consumer engagement across its core categories. Its focus on digital capabilities, retailer partnerships and premium brand mix further reinforces competitive strength and operating leverage. With a disciplined strategy and broad global reach, P&G is positioned to deliver steady, long-term value creation.

The Zacks Consensus Estimate for Procter & Gamble’s current fiscal-year EPS has remained unchanged at $7.01 in the past 30 days. This indicates growth of 2.6% from the year-ago period. PG’s shares have declined 8.6% in the past six months.

Price and Consensus: PG

Church & Dwight: Church & Dwight is strengthening its competitive position through a resilient portfolio of leading household and personal care brands supported by consistent innovation and expanding distribution. The company currently carries a Zacks Rank #3 and is benefiting from improving category trends, increased household penetration and strong demand across both value-focused and premium segments. Strategic investments in advertising, productivity and supply-chain efficiency continue to enhance brand equity and profitability. With disciplined execution and a business model aligned to evolving consumer behaviors, Church & Dwight is well-positioned for sustained long-term growth.

The Zacks Consensus Estimate for Church & Dwight’s current fiscal-year EPS has increased 2 cents to $3.48 in the past 30 days. The projection indicates growth of 1.2% from the year-ago period’s figure. CHD’s shares have declined 14.6% in the past six months. 

Price and Consensus: CHD

Grocery Outlet: This Zacks Rank #3 company’s differentiated value model, built on opportunistic sourcing and its Independent Operator structure, gives Grocery Outlet a durable competitive edge in discount retail. The company’s dynamic assortment of brand-name bargains, complemented by a growing private label offering and expanding delivery partnerships, strengthens customer engagement and reinforces its value leadership. Strategic initiatives — from accelerating store growth to refreshing formats — enhance productivity, expand market reach and improve profitability potential.

The Zacks Consensus Estimate for Grocery Outlet’s current fiscal-year EPS has increased a penny to 79 cents over the past 30 days. The projection indicates growth of 2.6% from the year-ago period’s figure. GO’s shares have declined 16.9% in the past six months.

Price and Consensus: GO