- Tide maker Procter & Gamble said this week that its customers were doing fewer loads of laundry to save money on detergent, the latest sign of a consumer pullback amid economic anxiety caused by trade-war talk and volatile markets. Elsewhere, nervous customers are spending less on body wash, snacks, and burritos as they hunker down for economic turmoil.
The White House’s ever-changing tariff regime is injecting record amounts of uncertainty into the economy, and that’s now made its way to consumers’ spending habits. After pulling back on everyday luxuries like travel and self-care and even big-ticket purchases, the uncertainty has come to settle in Americans’ laundry rooms.
Procter & Gamble CEO Jon Moller told Yahoo Finance that customers are doing fewer laundry loads each week to save on detergent. P&G, a major consumer-goods conglomerate, makes Tide, the U.S.’ best-selling detergent, as well as dozens of brands including Gillette razors, Pampers diapers, and Dawn dishwashing liquid.
It cut its financial outlook for the year due to consumer stress, to just 2% growth.
Competitor Colgate-Palmolive corroborated the trend on Friday. CEO Noel Wallace told investors on the earnings call that, while “consumers are still brushing their teeth, taking showers, cleaning their floors and feeding their pets,” they were feeling less inclined to stock up on purchases.
“You’ll see consumers destock their pantries and not necessarily buy that extra tube or that extra body wash as they see, obviously, a very volatile external environment,” he said. “Uncertainty creates a pensive and anxious consumer,” he noted, calling the February tariff announcements a “shock to the system” that made shoppers “very cautious.”
Makers of household staples from cleaning solutions to snacks are sounding the alarm over the possible impacts of tariffs on China and dozens of global trading partners. Even for companies that source domestically, tariffs represent a major headwind as they threaten to squash economic growth or possibly even lead America into a recession—which would make consumer spending dry up.
PepsiCo, which makes soda and snacks such as Doritos and Cheetos, said it was making smaller snack packs and individual servings, priced at under $2, to attract customers who were spending less, according to the company’s earnings call Thursday and the New York Times. The company expects flat earnings growth this year. And burrito chain Chipotle saw its first drop in same-store sales since the 2020 lockdowns, which the CEO attributed to “the consumer sitting on the sidelines.”
“Saving money because of concerns around the economy was the overwhelming reason consumers were reducing the frequency of restaurant visits,” Chipotle CEO Scott Boatwright told investors on a call.
So far, April consumer spending has held up after taking a dive in February, according to Bank of America spending data. But the mood is bleak. Consumer sentiment has fallen for four months straight, according to the University of Michigan’s flagship survey, the steepest decline in mood since the 1990 recession, and their assessment of where their own finances will be in a year fell to the lowest level in the 40-plus years the survey has been run.
“Consumers’ views of current conditions are as bad as at the end of 2022, when the Ukraine war and an overheating domestic economy sent home heating prices surging,” said Comerica Bank chief economist Bill Adams.
“Consumers are freaked out about tariffs, the stock market, inflation, and recession fears,” he added. “The U.S. economy is pointed in a bad direction, and the further it goes, the higher the risk of a recession.”
